On my flight back to US, I ran into Partha Iyengar,
Gartner’s resident analyst in
Major factors for my reasoning:
b) Mile wide, inch deep
As Indian firms bid for increasingly diverse IT development, maintenance and infrastructure projects their citations and skill sets are often superficial. Historically, loyal clients have given then opportunities to learn on the job. But as they compete more against western firms, competence more than loyalty will factor in decisions
c) Unsustainable economics
I have seen some on-site rates proposed by Indian firms in excess of $ 100 an hour. That is way more than what companies pay for local staff supplementation. Even blended on-site/offshore rates cannot compete with internal staff rates. Which makes Indian vendors competitive only against firms like IBM, Accenture and Deloitte – and they are growing their own sizable Indian operations and can compete at lower price points than they could 2-3 years ago.
d) The domestic US mood is increasingly negative
The Dubai Ports controversy. The strident immigration
debate. Growing trade deficits. Likely loud debate in Congress (and likely
The Indian tiger has not used up all its cat's lives - but it is increasingly on slippery ground. And the monsoons are coming.
Update : April 14 - Infosys disagrees with my assessment per this NY Times article. Infosys has done more than other Indian firms to hire US talent, but it is also more guilty than other Indian firms in push rates much higher - my point c.