Outsourcing to India is part and parcel of international commerce

Outsourcing to India is not a separate entity operating in relative isolation as compared with the day-to-day commerce taking place in the retail hemisphere. Outsourcing to India and the global outsourcing industry is today one of spokes; some say, it forms part of the hub, which enables competitive pricing for consumers—and therefore viable trade for Western companies.

Outsourcing and outsourcing to India is significant and a growing part of the large commercial sum that makes up world markets, and how they function. Remove outsourcing to India from the equation, and it will cause upheavals in the global economy the likes of which will be difficult to handle.

A lot of this has to do with the fact the economic wiring of international commerce is three-dimensional in nature. Outsourcing to India is so massive that a rise or slump in outsourcing to India has repercussions in other markets. In other words any change in the dynamics of outsourcing to India will have a dynamo effect, even though they may be rivulets, on Western and emerging markets.

For instance, if GE or HSBC were to cut down on outsourcing to India, and instead move back onshore, it would cause an immediate rise in prices of their services in lucrative consuming markets such as China, and even India. This loss in competitiveness would cause a decrease in shareholder value, thereby dampening the mood of financial markets.

In fact, one would not go far in saying that financiers and shareholders expect companies to use any method, in this case outsourcing to India, to maximize return on investment.

The reason why outsourcing to India has made the world so flat has a lot to do with the intrinsic nature of outsourcing, and what is expected of outsourcing.

In the case of outsourcing to India, various kinds of professionals joined hands, showed entrepreneurial drive, and tried to match expectations of their clients. In due time, they made a reputation for not only themselves but also for outsourcing to India.

In the hullabaloo about how outsourcing to India was taking away jobs that ensued, was forgotten that Western companies no longer held traditional advantages in terms of technology, management skills, and most importantly, that of low input costs in terms of manpower, and the monster reason—markets.

As a result trade and commerce that used to originate in the West and end in the East, is now originating in the East and ending in the East—this is a paradigm shift.

In fact, so rarified is the shift that Western markets are fighting to create enough employment to feed local production of products and services. In such a scenario, outsourcing and outsourcing to India becomes even more attractive for companies—especially those engaged in services, as it does not involve building of plants and other forms of capital expenditure.

What emerges from the coalescing of economic recession and the competitive powers attained through outsourcing to India, is that outsourcing and outsourcing to India have become an essential body part of global commerce.

All current and future business plans of companies around the world will have to factor in outsourcing to India to be able to fully compete in emerging markets, as even these are turning to be very competitive.