India is undoubtedly the top outsourcing destination with large talent pool available at reasonable cost. It is great value for money. Moreover, it is a country which was least hit by recession and continued to grow, but at a slower rate than before.
There are other countries which are coming up as outsourcing destinations but they are far behind in the competition. Philippines, China and Argentina are the new players emerging in the outsourcing field.
Though Philippines is picking up with voice call services—it is more of a complementary location to India. It's still far behind in knowledge process outsourcing. China is picking up in IT services but faces substantial cultural and linguistic challenges. It is not possible to see it as a competitor to India. Countries like Argentina, Mauritius and North African locations also have a long way to go until they provide SLAs (service level agreements) matching to India.
India today is a major outsourcing destination preferred all over the world. There are many reasons for this
• Yet another prominent reason behind India's glittering success in the global IT market is the maintenance of 'quality'. India's IT software products and services comply with international standards. In March 2002 itself 42 IT outsourcing companies achieved the SEI-CMM level 5 assessments. Today, most IT companies have ISO 9000 and people CMM. Three out of every 4 companies with SEI-CMM5 3 are located in India.
• Technological ability. India has emerged as a major technological power with more and more professionals in the market from India.
• Major exporter of software. India exports Software Technology Parks of India (STPI) is a society set up by the Ministry of Communication and Information Technology, Government of India, primarily to encourage and promote software exports.
• Technology parks in India. The STPI was set up in 1991 and today it is a force to reckon with. It is like a corporate sector acting as a service provider. The STPI provides infrastructure resources, a single window statutory service for import certification, software valuation etc. It also provides market analysis, market segmentation along with training for professionals. The government encourages foreign investment with Software Technology Parks of India which offer world-class infrastructure and various incentives and concessions to encourage foreign investment and promote software development in India e.g., 100% foreign equity is permitted and approved under the Automatic Route delegated powers to The Director STPI, tax holiday until 2010, etc.
• Government policies. IT is one of the top 5 priorities for the government. The government encourages the software industry by the timing of its policies and the simplistic procedures which is a great incentive for foreign investors.
• Past record of excellence. India has a track record of perfection and deadline driven work. There has been a quantum leap in the size and kind of projects India has been taking on. Gone are the days when India was outsourced only data entry jobs. Today there are projects which are complex turnkey projects involving hundreds of people.
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