An Indian call centre company is to create 1,000 jobs in Belfast, reversing the trend of UK companies offshoring back-office financial services tasks such as transaction processing to low- wage locations in the developing world.

The announcement by ICICI OneSource, the business process outsourcing provider, is the latest in a series of investments in by Indian companies. Industry experts say it is a clear sign that banks and financial services companies that use outsourced labour in remote locations to reduce costs are starting to rethink the business model. The rethink comes at a time of growing concerns about the security of financial information and the incidence of computer-based fraud and other crime.

A recent survey on the impact of offshoring by the Financial Services Authority warned that offshoring could contribute "a material risk to the FSA objectives of market confidence, reduction of financial crime and consumer protection".

It identified as the main risk the complexity of achieving suitable management oversight and the difficulty of maintaining control from a distance. However, it concluded that with appropriate governance frameworks, risk management systems and controls, companies could mitigate the problems arising from offshoring.

Peter Hain, secretary, described the latest announcement as an example of "near shoring".

He said: " is clearly the most competitive near-shore option for companies seeking a base to service western European markets."

Matthew Vallance, ICICI OneSource's managing director for Europe, said: "We no longer see our business as being located all in or all in the ."

ICICI OneSource, based in Mumbai, has 7,500 staff in , but half its global revenues derive from services provided for clients. Experts say companies need to be nearer their clients - the computer groups and financial services companies - to offer quicker response times. with its good IT skills base, cheap wages, and English-based business culture, has traditionally been a leading provider of this specialist business activity. According to Nasscom, 's main software trading body, accounts for 44 per cent of the global outsourcing market, earning Pound 9bn a year.

The ICICI OneSource investment is the first greenfield call centre set up by an Indian call centre company in , although last year HCL Technologies, another Indian company, acquired an existing business in the province. The ICICI centre is due to open next month. The company said it would generate Pound 28m for the local economy in terms of wages and salaries.