Sunday, June 01, 2008

India Still Rules Outsourcing - Forbes

A number of commentators
have indicated recently that the tremendous success of the Indian
outsourcing industry is about to come to an end. It is said that the
growth experienced by companies such as Wipro, Infosys Technologies, Tata Consultancy Services and others is about to stall at best, and come to a crashing halt at worst, as issues such as wage inflation, shrinking profit margins and high attrition rates lead customers to source services from other locations, such as China or Eastern Europe, or perhaps even closer to home.

However, as an experienced lawyer and adviser to both vendors and
customers on outsourcing deals, I consider it unlikely that there is
about to be any significant downturn in the Indian outsourcing
industry. Certainly recent results from leading IT vendor
(nasdaq: INFY -news-people),

which had a profit growth of almost 21% for the first quarter of 2008
over a year earlier, suggest there is little to worry about.

More generally, software and services exports from India are expected to touch the $40-billion mark in fiscal 2008, according to the Strategic Review 2008 by Indian trade association Nasscom (National Association of Software and Service Companies).