2005-08-01

China, Will be the Substitute of India in Dominating Outsourcing's Future

After a run of stunning good fortune, India's tech community finds itself dealing with a looming challenge from a flourishing Chinese economy. Just as American companies saw jobs disappear to less-expensive venues in India; China has begun to figure as an alternative for the practice of shipping tech tasks offshore.

The shift has not gone unnoticed by leading technology outsourcers in India, who are dealing with creeping wage inflation. As a result, some are fast establishing a presence in China to remain competitive with their peers.

What's more, besides the potential talent in management and market, the alluring low revenue from IT services is another big factor. Though it is rising in China, it is still barely half of India's $12.7 billion a year, according to a recent report from consulting firm McKinsey.

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