India Outsourcing Trends

The Economist says that there are “four trends converging in an industry-wide consolidation”:

Some multinational firms with captive offshore operations in India, such as Phoenix, are thinking of selling themin effect, outsourcing through divestment.

Second, young, fast-growing India-based firms, flush with cash and besieged by would-be investors offering more, are thinking of acquisitions as a way to sustain growth.

Thirdly, while these upstarts race to expand in their target markets, the big western IT consultancies are reversing the process. Last month, mighty IBM bought Daksh, one of India’s biggest call-centre firms, with about 6,000 employees.

Finally, as these multinationals bulk up in India, extending the range of their wares to include call-centre and other BPO operations, Indian firms such as TCS have been matching themas well as expanding overseas.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.