The Business of Outsourcing

Soon after the tech bubble burst, many of the highly educated Indian engineers on work visas were laid off and had to return to India. This reverse exodus back to India began in the early part of the 2000s just towards the end of the decline in the IT sector. Though much of the menial Y2K work was performed by low skilled graduates fresh out of college, the engineers being sent back home had plenty of experience with working at the highest level on complex software projects. These pioneers began to set up IT companies in the technology hubs of Bangalore and Hyderabad by utilizing contacts they had gained through working in the US. The focus of these companies was now no longer on performing routine code maintenance for value-add companies but was on creating new applications and proposals for original innovation. Indian companies were now in direct competition to their American counterparts, which has led to a leveling of the global playing field. There is little overhead in transmitting their work back to the US thanks to the networks constructed by the telecom companies in the 90s.