India Outsourcing Problems

India shoots itself in the foot with new tax: Wanted to point you to an
interesting article in our Outsourcing Newsletter this w. According to
our author (mehr@enterprisemanagement.com) India shot itself in the
outsourcing market foot recently by announcing an income tax of more than
36% on foreign firms that have software, R&D, or customer service operations
in India
<http://www.ecommercetimes.com/story...tion-37750.html>.
The tax was enacted ostensibly to discourage foreign-owned service
providers, such as EDS and Perot Systems, from establishing wholly owned
operations in the country. Instead, the theory goes, these companies would
send offshore outsourcing work to service providers owned by native Indians
in order to avoid the tax. And there are even more taxes like this on the
way. Sounds like a lot of greed to me.

Loopholes are a closin'.