But aren't the Indian firms learning from the process? There's a lot of very skilled engineers in the country, designing gadgets and writing code. Given that talent base, isn't it likely that there's a significant amount of spillover into the domestic economy? It's not like the maquiladoras, which mostly involve assembly work with minimal spillovers.
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Well I don't know if Indian IT and other service talent, used now it seems, mostly to meet the *backoffice* needs of Western firms, is applying the lessons learned to the internal market.
I'd be interested in any info on this if anyone has it.
As a model of the sort of internally-directed, homegrown IT effort I don't believe we're seeing in India, let's consider China and Linux.
With the assistance of the government and domestic venture capital, Chinese developers have taken the Linux kernel and created a Chinese variant of the open source operating system called Red Flag -
http://www.redflag-linux.com/eindex.html
Red Flag Linux is tailored to the needs of Chinese business and government. The teams of developers working on the project are providing an obvious value-add to Chinese efforts to modernize by reducing that nation's dependence upon foreign software vendors and nurturing home-grown talent. Chinese firms are providing outsourcing but also building domestic infrastructure.
I do not believe we've seen a similar effort of this scope in India. The focus seems to be on opening huge service centers to develop software, process paperwork, answer customer calls and do a variety of other keyboard-monitor centric things for non-Indian firms exclusively.
So, while the Chinese developer doesn't need to pretend to be *Bob from New Jersey* to get a job because his customer is the manufacturing firm in Shanghai and not some PC user in Manhattan, many (most?) Indian workers with similar skillsets don't appear to have this option.
I may be wrong about this and welcome examples to the contrary of my view.
DRM