40) China or India? Which to be the New Top Location for Offshoring service

China will defeat India to be the top offshoring location by 2011, IDC predicts; but other experts from other associations don’t agree.

India has pressure of poor infrastructure and form high staff cost, stated Conrad Chang, a research director at Asian-Pacific operations of IDC. China has opportunities in the Japanese and Korean markets while India is concentrating on those of America and Europe. China will catch up with India by 2011 for the reason that it invests heavily to improve the infrastructure, language, technical and other skills and Internet connections, IDC said.

However, Forrester Research Inc. holds a much less optimistic attitude over could China be an offshore location.

China mainly appeals to operations from Korea and Japan, however, most of Korean and Japanese firms would like to establish branches in China instead of outsourcing, because China has not many big service suppliers, according to Siddharth Pai, a partner from Technology Partners International Inc (TPI). In addition, corporations from Western countries have smaller offshore businesses in China than in India.

Furthermore, China is still not able to eliminate the customers’ worries about language skills, attrition and IP protection. On the contrary, India has set up a mature legal environment round common law of western countries, stated Pai. Although China makes much investment in education, in 4 to 5 years Chinese are unable to speak English as fluently as Indian technicians, so he said. “Indians has a history of speaking English for more than 100 year."