Indian Outsourcers Living Large on Demand
"We're keeping an eye on them [multinationals], but everyone is growing at a fast-enough rate at this point that [the Indian firms] are all doing fine," Parower says. "And the Indian guys are winning bigger deals."
Indeed, while the multinationals are suffering from shrinking contracts as deals become unbundled, Indian firms are seeing their contract sizes grow.
The China Challenge
Meanwhile, fears of China stealing business from India continue to swirl, although industry insiders doubt it will happen any time soon."China generally has a better infrastructure than India does because it's been a leading manufacturing center for so long," explains John Delaney, an attorney with Morrison & Foerster in New York who negotiates outsourcing transactions. "But India, because it's a capitalist democracy, has a legal system that, although not perfect, is much more responsive to the needs of businesses and Westerners," he says. Also not to be overlooked: India's English-language advantage over China. In China, English-speaking engineers command salaries 20% to 25% higher than India, according to Gilford Securities analyst Ashish Thadhani. So, at least for next year, look to India to continue to remain the sweet spot of offshoring. Get Jim Cramer's picks for 2006.
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