The Impact of Economic Reforms on Industry in India: a Case Study of the Software Industry

However, both the Country Profile (2005) and Business Asia (2010:10) highlight that although the fundamental political keeps stable, the efficiency of political is low. The cause of this existed problem is that the national parties weakened gradually while the regional parties which influenced by the coalition government strongly (Business Asia, 2010:10). Current President is Pratibha Patil. (BBC News, 2011). As a result, India began to conduct a relatively free liberal market reform. Nonetheless, because of the interests of coalition government members are dissimilar, the speed of market reform is limited (Business Asia, 2010:10).

As we all know, Canada is a democracy with parliamentary government; Canada has tenth largest economy in the world and Canada is a member of OECD and the G-8; nowadays, Canadians have a satisfying income, a good education and most of whom dominated middle class or higher; Canada is the leading nation in science and technology especially the internet and digital communication. India is a democracy government and the political environment is influenced by government’s policies, politician interest and so on, which means the business environment is affected by the political factors; the economy in India is exceedingly stable due to the industrial reform policies; the social factors of India comprise of a multitude of social trends and changes such as values, languages, belief, demographic features and so on; even though India posses one of biggest IT sectors in the world, most of technology sectors in India is far behind other powerful nations.

India has become a global conduit for business as they have liberalized their economic policies over the past 20 years. Companies are flocking to India because of many factors, including, less expensive labor costs, increasing growth rate, and an abundance of a highly skilled workforce. These factors in addition to other advantages have substantially increased the number of United States businesses looking to grow beyond the U. S borders into the county of India. Dunlop Software Consultant’s goal is to also expand its operations internationally and believes that India has the business environment to meet our goal of expansion globally.

The IT Service industry has expanded rapidly. Many companies worldwide have made the decision to outsource this industry to offshore companies. Worldwide demand has increased growth to 40 to 50 percent on an annual compounded rate basis. Many developing nations like Latin America and Asia have made an attempt to obtain some of the IT offshoring business from countries like the United States because it is seen as not only a source for

3. What qualities enabled India to take center stage when the looming Y2K scenario generated unprecedented demand for programmers? What can other nations learn from India’s success in this realm? What are India’s greatest vulnerabilities?

The only means for the IT companies to maintain business and to have minimal losses was to transfer their services overseas to India. Nonetheless, many of the people who had lost their IT jobs saw this as a disadvantage since they were the ones who had to either find another job that matched their skills or had to obtain new skills. Along with this, they, along with the majority of the workforce, saw outsourcing as something harmful to the American economy and that it caused increase in cost (Easterls, 166). These outlooks are not necessarily true, however.

The outsourcing of non-core business and services has risen in recent years. The top benefactor of this rise has been India. Corporations have found a profusion of well-trained, English-speaking workers to cram into call centers and customer service jobs. This is even happening in high-skill positions like hospital X-rays technicians also. India is seen as the pioneer in outsourcing jobs

Information Technology is mixed with contractors and full-time employees. Most of the critical IT software application development contracted to offshore an Indian company. Though, the majority of IT development is handling from India it also has significant size of IT development centers in the USA and small IT development centers in London, UK and Malaysia for fulfilling contingent local

The thousands of technically astute, English-speaking graduates of India’s elite universities are riding America’s outsourcing wave. Blue-Chip companies IBM, Oracle, and Intel have already established a presence in India, as have promising start-ups. India increasingly is landing high-skilled, highly paid positions for engineers, accountants and financial analysts formerly employed in the United States. West Palm Beach-based Ocwen Financial Corp. offers a case study in how companies are cashing in on India's allure. Seeking to cut labor costs, Ocwen has hired hundreds of workers during the past two years in India, where skilled workers are plentiful and wages are low. Ocwen, which once had nearly 1,000 employees at its Palm Beach Lakes

With a large English-speaking population, American companies do not have to worry about any barrier language barriers with regards training and negotiation. In addition, India also has a large population of unskilled workers who can work either manufacturing, or the call centers. Perhaps the most important benefit of outsourcing to India is its lack of regulation which allows companies to compensate workers far below the value of the work they are doing. Because of these reasons, essentially any company which requires call centers and manufacturing bases see India as a viable

|Answer : The Indian IT industry has been the great success story of India's liberalisation. Starting with an export of around $100 million and |

Targets of production were more or less reached in the case of cotton textiles, sugar, vegetable oils, cement, paper, soda ash, caustic soda, rayon, electrical transformers, bicycles, sewing machines and petroleum refining.

“Today, Indian outsourcing is one of the best ways for CIOs to cut application development and maintenance costs, and deal effectively with the peaks and valleys of software demands.” (Yeo). Outsourcing to India is still focused primarily on highly technological aspects, but is not limited there. They are known for creative development in the pharmaceutical field, and have recently developed an unsurpassed medication for adult ADHD. Their superior IT assistance is not limited to companies, they offer many websites for individuals seeking help with programming. In mid 2007, U.S. outsourcing to India reached $4.9 billion. Although technologically advanced, they still lag in economic prosperity and therefore still don’t expect the type of compensation that Americans do. “They

Infosys is an IT consulting company based in India but primarily doing business with North American firms looking to outsource their IT needs. With the rise of the popularity in this form of business between the United States and India, there have been several political factors in both countries that will affect the way Infosys does business. In the US, President Obama made outsourcing a hot topic of his campaign platform. With speeches such as “Say no to Bangalore, yes to Buffalo” he is looking to provide incentives to American companies to keep all of their jobs on American soil, close tax loopholes and eliminate breaks given to companies that outsource to firms such as Infosys. On the flip side though, the US government is also looking to change immigration policies to restrict H-1B visas that would have previously allowed foreign skilled technical workers to be brought in to the US on work visas. While they won’t be eliminating them, they are seeking to restrict them which would force Infosys to hire employees from the US for any work they would be doing in the country and restricting the available talent pool. Meanwhile, the government in India is making changes of their own, particularly with reforming the tax code. To encourage the growth of the Software and Technology fields the Indian government had established significant tax breaks which are now coming to an end. In addition, they have

Tier1 cities have also seen an impact of the IT-BPO industry as the population in these cities have increased due to the growth of this industry. The IT-BPO industry is also looking at tier 2 and tier 3 cities as potential cities to expand into. These are all impacts of how IT outsourcing has effected India’s economy as well as the people living in this country.