A study conducted by Warwick Business School in UK on the fast growing outsourcing industry revealed that India will remain a leading force in the business process outsourcing industry for the next two decades. The report also said that China will continue its struggle to match its success.

Indian IT outsourcing majors like Infosys, Wipro, Genpact and Tata Consultancy Services has contributed to 9 percent of economic growth before the global financial crisis struck last year.

Some companies have started making investments in outsourcing capabilities in China in order to overcome competition from China. Wipro has opened a global delivery centre in Chengdu last week and it will serve manufacturing, banking, financial services and insurance industries.

The contact centre will provide service in three languages – English, Chinese and Japanese. Genpact has business process service centres in Chinese cities of Changchun, Dalian and Shanghai.

A report from WBS, commissioned by Cognizant, the global consulting and technology group, predicted that the rise of China's less mature industry was far from assured. The report said that China will emerge as an alternative, though it will struggle to achieve scale in western European and North American markets.

According to Ilan Oshri, one of the report's authors and associate fellow at WBS and the London School of Economics Outsourcing Unit, India will maintain its lead atleast for the next 15 years as the top Indian companies have established a global footprint. He also pointed out that India has advantages like English is being considered the official language in India, the high quality of its graduates and the development of a domestic market for outsourcing services.

He told the Financial Times that India is not a powerhouse because it is cheap but because it is smart. He added that Chinese vendors are not emerging as powerhouses. The research conducted by Oshri identified that, countries like Egypt, Hungary and Romania becoming popular as outsourcing countries.

The western companies see outsourcing as a means of cutting-cost on quality of service and price. Oshri also commented that China is much cheaper than India. But the game is not about cost, it’s about accessing talent.

The global IT outsourcing industry had an estimated revenue of $250bn last year.