Friday, January 16, 2004

Re: What goes around comes around

I hope it is not just a bubble like the ".com" era that will burst in the coming few years. What then will India do? And China is always a looming threat. When you can get it for x percent cheaper in China, why not go there?

the indian economy is certainly very hyped nowadays. the markets are at their highest ever levels, and everyone is bullish. every second day there are articles of india becoming a super prower in 20 years or so. a large section of the indian population still lives under the poverty line, and the economic divide is getting ever greater. many people are hoping that the money with the middle/upper class will trickle down to lawer sections. there are many issues like corruption in government and caste/religion poitics. many things are going great nowadays, but there is a long way to go.
another fad here, (and rightly) is comparison with china. this question is asked everywhere always. but somehow i do not think china is all that great. they have major social problems, communist roots. there was talk here of chinese goods flooding the indian market, destroying local co's. everything from motor bikes to bulbs. the goods came, and were discarded. the goods were cheap but of highly inferior quality. what about in america? so in the end india has to do a lot but if it can maintain a price vs quality ratio, then things should be fine. already we hear news of india becoming a auto-components hub. there are few more examples, but the number is slowly improving.

But from what I've read, it seems that the jobs being outsourced are not the greatest jobs in the world. It seems that it is the more repetitive manual labor that is getting pushed to India.

true that a lot of labour intensive jobs are being switched. but those jobs also go to some indians. many people i know are working in call centers. and earn as much or even more as engineers in general co's. so in the end its great. personally i would consider it a failure if i have to work in a call-center after all these years of education. but again something is better than sitting at home.

And it is not the case that companies over here are completely moving offshore. Part of their IT deparment might have shifted, but they still have local devs.

i doubt if you will ever have a complete shift of jobs. only parts will be outsourced. the question is major or minor parts.

i read an article quite some time back. it explained how there was a time when shifting of ic component manufacturing to east asia was something like the current indian case of outsourcing. co's were very shy of declaring that korean co's were manufacturing a low costs. finally the industry accepted it and co's which were not using foreign chips were at a downside. a similar thing might happen with outsourcing. it needs time to mature and gain acceptance.

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