The large multinational IT services companies continue to dig their heels deeper into India, lured by both the country's educated but cheaper workforce and its burgeoning economy.

Earlier this week,

IBM

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said that its subsidiary IBM Daksh has ballooned to 20,000 employees from 6,000 at the time of acquisition in April 2004. IBM India, the largest multinational company in the country, now boasts 43,000 employees.

IBM Daksh provides finance and accounting, human resource management, customer service and back-office support to companies in the travel, financial services, telecom and utilities industries.

The growing number of employees at IBM Daksh has been fueled by Fortune 500 companies outsourcing business offshore, Big Blue said. Recent clients included a U.S. health insurance company, a U.K. Internet service provider, a major airline and one of the world's largest telecommunications companies.

IBM Daksh is part of the company's plan to move into high-value markets and help clients improve business processes and operations, rather than compete for "shrinking profits in the commodity markets of the old IT industry," Pavan Vaish, COO of IBM Daksh, said in a statement.

Meanwhile, on Thursday,

Accenture

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said it is opening a new branch in Pune, India, that will focus on software outsourcing and systems integration. The company said it plans to hire 1,600 recent graduates and IT professionals by August.

The number of the company's employee's in India has spiked to more than 17,500 from fewer than 4,000 just three years ago throughout Bangalore, Chennai, Hyderabad and Mumbai.

"The launch of our operations in Pune is further proof of Accenture's commitment to India and allows us to tap into a large pool of high-quality talent in the city," Sandeep Arora, lead executive of the Accenture delivery center network in India, said in a statement.

Indian IT firms have been grappling with high turnover and higher salaries as

competition for employees heats up among the Indian companies themselves, as well as among the multinational corporations aiming to boost operations offshore.

Big Blue shares were up 70 cents to $80.60; Accenture's stock slipped 24 cents to $27.92 in late afternoon trading.