India still top destination for US firms, says Forbes

By siliconindia   |   Tuesday, 02 September 2003, 19:30 IST
Printer Print Email Email
India continues to be the prime destination of outsourcing for the American companies as the country turns out 75,000 IT graduates and two million English-speaking graduates every year.

NEW DELHI: According to an article in Forbes magazine, India is the leading recipient of the outsourcing of information technology functions like software development and maintenance, and also business process outsourcing. The latter includes back-office functions like accounting, human resources, call centres and data analysis. English speaking IT graduates, low wage structure and attractive labour pools take India to the top position, the study concluded after comparing it with six other destinations -- China, Russia, the Philippines, Canada, Mexico and Ireland. Though labour costs have crept upward over the years, these have been offset by falling telecom rates, the article stated and added that typical salaries range from $5,000 to $12,000 for technical staff, while back-office salaries range from $3,500 to $7,500. In its comparative analysis of seven countries, the article praised India’s IT-friendly policies thus: “Outsourcing is so ingrained in the fabric here that the Indian government has a national minister specifically for IT. The government favours IT foreign ownership and imposes no export taxes.” About the country’s IT infrastructure, the Forbes piece states, “With redundant telecom and utility infrastructure, there is very good reliability within India's special IT parks. Reliability can be spotty outside the parks or in more remote areas.” Application development, maintenance, call centres and financial processing are the areas of expertise for Indians. But experts believe that the country would become a hotbed for more critical analytical jobs in the future. "Simple base level back office payroll and data entry will got to rock-bottom-wage countries over time and countries like India will move up the chain and take on more complex software and product development services," John McCarthy, an analyst with Forrester Research, was quoted as saying. Analysts predict that, by 2015, more than three billion white-collar jobs in the US will be farmed out to other countries, up from 300,000 today, the article stated. (Courtesy: ET)