> 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.
One useful source for information about Indian software industry is National Association of Software and Sevice Companies (Nasscom) at http://www.nasscom.org/. This is the industry organisation representing the all firms in the industry. Apart from the transfer of technical knowhow, the software exports other positive consequences: Impact on stock markets of boom in software exports, better balance of payments position etc.
Indian capitalism has largely been driven by growth of the internal market, as overall exports are only about 10-12% of the GDP. Software industry is one of the very few industries that relatively depend on exports for growth. But even here, both the exports and domestic markets are growing in absolute terms. One would also need to consider the large scale use of pirated software in the domestic market. This is hard to quantify. This doesn't get recorded in numbers published. OTOH, it is difficult to conceal exports; this results in a bias in favour of exports in the published data.
Ulhas