Union leaders have attacked a Tory-led council over its involvement in the "export" of up to 100 jobs to India, amid warnings that the move could be "the tip of the iceberg" that could see thousands of taxpayer-funded jobs go overseas.

Unite claimed Birmingham city council, a Conservative-Liberal Democrat run authority led by the Conservative Mike Whitby, is the first town hall in the country involved in plans to move jobs to India for work paid for by taxpayers. A redundancy notice for 70 IT posts has already been served.

Officials said they feared more council jobs in Birmingham and other local authorities could also go abroad as private companies delivering public services prepare to go to "any length" to cut costs for profit.

Another union cited jobs being "shipped out" as it launched a strike ballot of nearly 10,000 members at Birmingham city council over job cuts, workers' pay and conditions.

Unison is balloting against plans known as the Birmingham contract, which it claims breaks away from nationally agreed terms and conditions, abolishes payments for weekend and out-of-hours working and weakens workers' rights in grievances and disciplinaries. It said the "contract" will have a disproportionate impact on low-paid women workers.

The union said that, to add "insult to injury", staff who face redundancy at the arms-length IT company are being told they must train up their replacements in India before they go.

But the council said the new staff contracts were designed to make the authority "fit for the challenges facing the public sector" and contribute to the budgetary savings it has to make.

Alan Rudge, the cabinet member for equalities and human resources, said: "There is a clear need to bring our organisation into line with other leading employers, and the new Birmingham contract will make the council more resilient to future pressures through the reduction in costs and the introduction of broad job groups."

Service Birmingham, a joint venture between the outsourcing firm Capita and the council, confirmed it has already transferred 17 "back office" IT support roles to India and has issued formal notice of redundancy plans for local workers ahead of the transfer of a further 38 roles in the summer.

A further 45 jobs will be transferred to India later in the year if the first two phases of transfer go well, according to a spokesman.

In a statement, Service Birmingham said: "It is important to emphasise this is a very small element of the work we do for the council, and we remain absolutely committed to our Birmingham workforce."

The Unite national officer, Peter Allenson, said: "It beggars belief that council workers will be forced to train workers from overseas to do their jobs so Capita and Birmingham council can lift and shift them abroad.

"Unite is demanding that Birmingham city council halts its plans. We fear this could be just the tip of the iceberg and other councils could follow suit. Thousands of public sector jobs could go. Once these jobs go, they will not come back."

He added: "The blame lies firmly with private companies prepared to go to any length to cut costs for profit and this Tory-led council which is encouraging them to get away with it."

A council spokesman insisted the transfer of jobs to India "is a story about Service Birmingham" and referred all comments to its spokesman. The council has a one-third stake in the venture.

Capita, through the Service Birmingham company, has the contract for the council's IT and call centre services until 2021. It is also working on the authority's business transformation programme, which has been running since 2005 and aims to save the council £1bn in costs by 2016.

Despite the planned redundancies, Service Birmingham said it was committed to increasing local workforce numbers. "Offshore staff will only ever represent a fraction of Service Birmingham's 1,100 workforce," the statement said.

"In addition, we will honour our jobs promise to employ an additional 520 people in the Birmingham area by 1 April 2011, 720 by 1 April 2013 and 800 by the end of 2016."

The council plans to cut £300m from the city budget by 2015 as well as shed 7,116 jobs, which Unison says represents 37% of the council workforce.

The union claims that, once part-time jobs are factored in, the total job losses increase to 10,000, which will have a "devastating impact on council services".

Mark New, a regional organiser for the union, said: "Members are upset and angry and Unison is asking them to take a stand against these savage cuts. To add insult to injury, the council plans to outsource more jobs to India.

"The massive job cuts, the pay freeze and privatisation, will leave the council struggling to provide decent services to people in Birmingham.

"Birmingham council is cutting back too hard and too fast. The cuts will devastate whole communities and the local economy, as well as the lives of council workers and their families."