HE RECESSION and events of last fall may have caused a slowdown in the U.S. economy, but they have not derailed the growing trend of U.S. corporations to reach beyond our borders for software development and maintenance services. In fact, it is quite likely that the business downturn, and the corresponding pressure it has placed on companies to cut costs, has contributed to an acceleration of overseas sourcing. For corporations large and small, located in Silicon Alley, Silicon Valley or elsewhere, the ever expanding supply of high quality engineers and favorable labor rates offered internationally are being seen as increasingly attractive alternatives.
When U.S. companies look for overseas technology partners, they increasingly turn to India. According to Gartner Inc., the technology research and advisory firm, software development now represents a $4 billion export industry for India and supports more than 900 software exporting firms and 400,000 information technology professionals. The reasons for the growth in Indian software exports, particularly to the U.S., are fairly clear. The relatively low hourly rates Indian companies charge for their highly skilled IT workers can lead to significant cost savings for U.S. companies – up to 35 percent according to one recent survey. The predominance of English as the business language of choice no doubt helps as well. So too does the development of a legal regime that is offering increased protection to the holders of intellectual property rights.
