Why Offshore Outsource to India?

According to a recent survey conducted by The National Association Of Software and Services Companies (NASSCOM), over 80% of European and US businesses prefer to offshore outsource their IT processes to India. The study also went on to say that almost more than 50% of the Fortune 500 companies in the West are keenly looking to build a development team in India. 

Even though countries like China, Mexico, and The Philippines have, in the past, been some of the most famous outsourcing destinations, India has quickly risen to the top of the list today. So what are the differentiating factors that make India the perfect offshore outsourcing destination in 2020? Why is the Indian IT outsourcing industry experiencing an average growth rate of 25% every year? Here are 6 main reasons:

1. A massive tech pool

India is home to some of the best technical experts in the IT industry today. With a population of 1.35 billion people and 1.5 million engineers graduating each year, India is undoubtedly the biggest tech pool that the world has ever seen. And it doesn’t end there. 

India is also known as the largest English speaking nation in the entire world, even leaving behind the US and the UK by a long stretch. That means that any business in the West that builds a team of developers in India will get access to English-speaking tech experts who are innovative, creative, hard-working, and can positively impact their business. And that’s exactly why IT giants like Microsoft, Google, SAP, and Yahoo, to name a few, have established their R&D centres in India. 

2. A diverse range of services

Software development companies, offshore providers, and outsourcing partners in India are known for the wide range of solutions and services that they offer. They provide customisable solutions developed according to the specific business needs of each client.  

For instance, if you want to build a dedicated development team in India, you can partner with an offshoring company. Or, you want a team of developers on a temporary basis or for a one-off project, you can sign a contract with an outsourcing partner. There’s something for everyone. 

3. Cost-effective options 

One of the primary reasons why India remains a top offshore outsourcing destination is because of the lower costs of operations. The primary reason why IT services in India are available at a significantly lower price as compared to the West is the lower cost of living in India. For instance, the living costs in India are easily 1/3rd the price of living in a city like London. This allows businesses to hire Indian developers for rates as low as $15-20/hour as compared to the UK, where the average price of hiring a developer is anywhere between $50-60/hour. This allows companies to manage their budget and reap larger profits.

However, this does not mean that the quality of the software that you build is going to be cheap. It simply means that the lower cost of living and higher disposable income in India can be used to your advantage. 

4. Consistent, high-quality services 

As discussed in the previous point, getting access to cost-effective services does not mean that the quality of the software that you get is low. The primary reason why India is a preferred offshore outsourcing destination is because of the consistent, high-quality services provided by software firms in the country.

In a recent National Outsourcing Association (NOA) conference, stakeholders from various famous companies were asked why they chose India to outsource their development processes. One of the stakeholders during the conference said, “Cost was only one of the many factors. Benefits such as quality and time-to-market meant more to our business, and that’s why we chose India.”

5.  Advanced tech-infrastructure 

Though India is said to be a “developing” country, Modern India has some of the best tech infrastructures in the world today. India, as a nation, has made numerous advances in software technology, including building customised IT solutions, systems migrations, legacy system maintenance, integrations, cellular networks, ISP, telecommunications, and more. 

6. Attractive IT Policies

The Indian software industry, specifically the outsourcing industry, is supported by a pro-IT government whose policies on the economy and taxation have boosted the IT development in the country. The Government has also framed policies to obtain maximum benefit from IT offshore outsourcing to India. 

Drew Neisser