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| Over the past few years, India has emerged as the preferred destination for offshoring several key operations in US firms. Let us explore why: |
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| 1) Human Resource Strengths |
- Large Qualified Human Resource Pool:Every year, approximately 19 million students are enrolled in high schools and 10 million students in pre-graduate degree courses across India. Moreover, 2.1 million graduates and 0.3 million post-graduates pass out of India's non-engineering colleges
- Indian Education System:Mastery over quantitative concepts coupled with English proficiency has resulted in a skill set that has enabled the country to take advantage of the current international demand for IT enabled services.
- Quality Manpower:India also has one of the largest pools of English-speaking professionals.
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| 2) Infrastructure |
- Presence of a robust infrastructure (telecom, power and roads) in the country
- Government has taken steps to ensure that telecom remains a priority area
- Regular, reliable, uninterrupted power, a major necessity for running services businesses, has also received substantial attention from the Government
- Roads and highways scenario in India has also witnessed major improvements
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| 3) Competitive costs |
| Amongst various offshoring destinations, India offers the most competitive cost structures. For example, an average college graduate in India earns around $2,400 as opposed to approximately $30,000 for his US counterpart. Cost savings of this magnitude can be extended to every aspect of offshoring operations resulting in significant net savings for the US firm. |
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| 4) Knowledge professionals |
| The next paradigm shift in offshored services is going to be from mere business process outsourcing (BPO) to knowledge process outsourcing (KPO). With its world renowned specialty schools like the Indian Institute of Technology (IITs), Indian Institute of Management (IIMs) and several world class medical and law schools, Indian service firms can move up their clients’ business value chain by supplying value-added, research-based analytical services, instead of run-of-the mill back office services, while maintaining their cost advantage at the same time. |
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| 5) Government |
| India has a stable political climate. The Government has also introduced several incentives such as tax holidays, subsidized real estate, etc. to promote investment in offshoring centers. |
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| (with inputs from India’s National Association of Software and Service Companies (NASSCOM)) |
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