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Economic Growth and Challenge: India

Global shift, outsourcing and offshoring

  • 3 things to know
  • Component 3 Section B

Overview

Global shift, call centre and two major Indian information technology services companies.

What you need to know

Answer each one before you reveal it.

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Key term

Define the global shift.

Key term

Distinguish outsourcing from offshoring.

Process

Why did India capture so much of the world's business process outsourcing?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    Define the global shift.

    Model answer

    The global shift is the movement of manufacturing and service work from developed to emerging economies. Lower labour costs and cheaper transport and communication drive it.

  2. 2

    Distinguish outsourcing from offshoring.

    Model answer

    Outsourcing means contracting work to a separate company, which may be in the same country. Offshoring means moving the work abroad, whether to a contractor or to the firm's own subsidiary.

  3. 3

    Why did India capture so much of the world's business process outsourcing?

    Model answer

    A large English-speaking graduate workforce could be hired at a fraction of Western salaries. Satellite and fibre links from the 1990s made distance almost irrelevant to service work.

  4. 4

    How does the time difference help Indian outsourcing?

    Model answer

    India sits about five and a half hours ahead of the United Kingdom and ten ahead of New York. Work sent at the end of a Western day can be returned by the next morning.

  5. 5

    What is a call centre, and where are India's concentrated?

    Model answer

    A call centre handles telephone and online customer service for clients based abroad. Bengaluru, Hyderabad, Gurugram and Pune host the largest concentrations.

  6. 6

    Name two major Indian information technology services companies.

    Model answer

    Tata Consultancy Services and Infosys are the two largest Indian information technology firms. Wipro and HCL are the other major names.

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