India Insight

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Europe’s reluctance to send information technology and other business processing work to India might be changing, based on recent financial results from companies that specialize in handling “IT and business process outsourcing” work. It looks like this is a trend that will last more than a quarter.

Many European companies have shied away from sending work overseas, unlike American firms that jumped in feet first, seeking to cut IT costs by as much as 70 percent despite the barrier between two kinds of English. Add to that countries such as Germany and France, where the divide is between two languages altogether, and outsourcing faces a larger challenge.

Big companies that deal with IT and business process work have found that establishing a beachhead near the client seems to make a difference. By hiring small numbers of local consultants, they can send most of their work to Indian offices while presenting familiar images and voices.

U.S.-based Cognizant, which has about 75 percent of its staff in India, grew European revenue more than 7 percent quarter on quarter for the two consecutive quarters that ended Dec. 31. Cognizant provides data management services to French drugmaker Sanofi SA and manages computer systems at Dutch financial services company Rabobank N.A. Other clients include AstraZeneca Plc and Philips Electronics.

India is the land of colours, sound, and call centres -- or at least, that is what Western popular culture has been trying to reinforce over the past few years. "The Best Exotic Marigold Hotel", starring Judi Dench, is Hollywood's most recent expedition to India, and it sticks to the formula.

The film is a comedy about a group of British retirees, shunned or underestimated in their own country, rediscovering their desires and ambitions in India.

They are lured to Jaipur, the city of palaces, with an online advertisement of a hotel that promises a life of leisure to the elderly -- only to find themselves in a building on its last legs, run by an incompetent, hyperactive Sonny, played by Dev Patel of "Slumdog Millionaire". Patel's love interest is a modern young girl who works at a call centre.

When the British were finally expelled from India in 1947, driven out of a country scarred by decades of imperialist rule, they left at least one parting gift: a linguistic legacy that has formed a crucial ingredient in the country’s economic miracle.

English proficiency is hailed as an invaluable foundation in India’s rise to the top of the world’s information technology and knowledge outsourcing industries, fuelling the country’s rapid growth with billions of dollars of business every year and streams of overseas investments into global IT centres such as Bangalore.

But, as Asian rival China surpasses India’s English proficiency rates for the first time, that advantage over other developing economies looks to have been squandered.

As the pundits predicted, India will have the inauspicious honour of being the first country to host U.S. President Barack Obama following the largest shift in public support away from an incumbent President’s party in over 60 years.

But if the results show a clear message of dissatisfaction at Washington from U.S. voters, the fallout once the dust settles on Capitol Hill could well result in good news for India.

Here are three ways that a shift in Washington politics could play into India’s interests:

The Senate might have quashed Democrat plans to force U.S. firms to produce jobs and profits at home, rather than overseas, but India Inc is wrong to think the danger has passed.

Over the past few weeks, India’s newspapers have been littered with stories surrounding U.S. President Barack Obama’s comments on curbing outsourcing, and India Inc’s gross indignation at the White House’s intentions.

No surprise, then, to see bullish headlines following the Senate vote that effectively ended legislation dubbed the Creating American Jobs and End Offshoring Act. ‘India Inc cheers defeat of anti-outsourcing bill in US‘, ran one leading daily, while another led with ‘Anti-outsourcing Bill dies a quiet death in the US‘. Death is wide of the mark.

– Saritha Rai writes for the GlobalPost, where this article first appeared. –

It is dawn in Kerala, a palm frond of a state in India’s South West. As the sun’s first rays hit the church steeple, a Holy Mass is being conducted in the local Malayalam language.

Only, the prayer is dedicated to a newborn by his Catholic family half a world away in the United States.