Fast, cheap, and in English, India clerks for the world

Sunita Shekhar Menon is a young, self-possessed woman who speaks English like a diplomat. Sitting in a plush office here, she solves the problems of airline passengers calling from Switzerland who don't want their two children home alone. Because of a typist error, the kids have tickets for a flight different from their parents'. With a few swift keyboard stokes, Ms. Menon reunites the family.

Three years ago this British Airways "back office" sat in costly London. Now the operation runs out of Delhi and Bombay, staffed by college grads like Menon. For them, the $282 a month starting salary is princely - some 7,000 Indians compete for each job. So effective and cheap has been the airline's move to India that it is branching out to other simple data services, opening a new 1,000-strong office this month.

With India's vast pool of educated English speakers, and new high-speed data technology that wasn't available five years ago, the question is: Will India become secretary to the world?

Critics say the work is a form of "techno coolie labor" - low-tech sweatshops that may use labor in the way that assembly-line workers in other developing countries have been exploited.

Indian skill in applied math made this country a Silicon Valley of South Asia during the 1980s - with firms in Bangalore and Hyderabad now turning out engineering schematics, top-quality graphics, and Y2K research at a fraction of the cost charged in the West.

But a globalizing economy allows India to bid for the services known as "back office" or "remote processing." In front of blinking computer screens 9,000 miles from the United States, Indians are producing legal and medical transcriptions while Americans sleep. In Madras and Calcutta they answer customer requests, offer help desks for computer dummies, process payroll accounting, and take 24-hour phone calls on credit cards.

The number of Western and Indian firms starting back-office services has exploded. Since 1996 the back-office sector in India has grown from $15 million to $300 million, according to the Delhi-based National Association of Software and Service Companies (NASSCOM). Wide-eyed entrepreneurs here speak of a $250 billion global market. "My business has developed from a few people to 300," says Veer Sagar, whose company transcribes doctors' notes for an Ohio firm.

"This is a developing phenomenon," says a Western economic official. "A lot of the back office comes from big corporations with staff sitting around Delhi and Bangalore, waiting for India to liberalize its policies. They are becoming familiar with India and feel, 'Hey, here's how we can make, or save, a buck - instead of twiddling our fingers.' "

INDEED, the back-office phenomenon creates an embarrassing dichotomy for the Indian government. Traditionally, India, which has some of the highest tariff rates in the world, has defended a protectionist policy on the grounds that swadeshi, the term for economic self-reliance, is a moral imperative. The government has made it difficult for overseas firms to enter and compete in all sorts of consumer products. Yet so far the Indian government has been happy to accept overseas pay for its domestic labor pool, and has not limited back-office firms.

Technologically speaking, the back office is made possible by new forms of encryption and faster baud rates that allow huge blasts of confidential data to dart instantly around the world. Satellites transmit millions of lines of code in minutes. Also, "The time difference gives us a special advantage," says Deepak Luthra of NASSCOM. "By the time you wake up, we have done the work."

Many Indian firms keep a low profile. Not only is there a concern over an eventual outcry from countries losing jobs to India, there is also a local dimension: Many firms do not want the Indian government getting too involved, creating burdensome oversight and rules.

"We have heard managers saying they prefer that Delhi continue with the hands-off approach it has taken to the computer industry," says the Western official.

Back at the British Airways office, Menon corrects hundreds of messages a day, but finds the work interesting since it involves solving coding puzzlers. The office has modular desks and carpeting, and looks out over an open-air lobby where giant sculptures and paintings hang above indoor plants. Menon does not feel exploited. Rather, her job, which she does along with post-graduate work, gives her status with her friends.

"It's a new idea for us - handling global work. We have become the backbone of British Air," she says with a self-mocking bravado that suggests she feels it is partly true. "Plus, I get great deals on travel!"