Question

Mr. Ravi, an IT entrepreneur from Bengaluru, observed that several MNC's prefer India as their outsourcing Hub for services like software development, customer support, data management etc.
His friend Priya believes this is due to certain inherent advantages of the Indian economy.
In your opinion, state and explain any two factors that make India a preferred outsourcing destination.

Answer 1

1. Skilled English-speaking manpower: India possesses a vast reservoir of educated, English-speaking professionals. Because English is the medium of instruction in higher education (especially in engineering and management), Indian workers can communicate effortlessly with clients in the US and Europe, making them ideal for global service delivery.
2. Cost effectiveness and wage differentials: The cost of labour in India is significantly lower than in developed nations. An MNC can hire a high-quality software developer in India for a fraction of the salary they would pay in their home country. This “wage arbitrage” allows global companies to reduce their operational costs while maintaining high service standards.