The latest global services location index by AT Kearney shows India ranks favourably in its people assets in terms of education, experience and security of intellectual property. And the people of India seem to have given it its prime advantage. The report says the large, educated labour force with relevant work experience gives India an unbeatable advantage.
 
India also ranks favourably by way of financial attraction too. But the report says even though the wage cost in India is not high, India's tax cost is one of the highest in the 50 countries surveyed.
 
An unbeatable mix of low costs, deep technical and language skills, mature vendors and supportive government policies have taken India to the top among global destinations for offshoring services. And this is despite all the concern about overheating, wage inflation and service levels, a recent survey by AT Kearney said.
 
In overall ranking, dominated by the developing countries from Asia, India is followed by China, Malaysia, Thailand and Brazil, the survey, christened Global Services Location Index 2007 said.
 

To arrive at final ranking, AT Kearney surveyed over 50 countries for different aspects related to offshoring, like people skills, financial attractiveness and business environment. India maintains a wide, albeit slightly shrinking, lead over China, confirming what industry surveys and visiting executives have found, the survey said.
 
While compensation costs in India have risen because of the recent high economic growth, "these cost escalations have been matched by corresponding increases in skill supply and quality indicators," the global consultancy major said.
 
India's success is also prompting developing countries to replicate its model. While in Asia, two of its neighbours, Pakistan and Sri Lanka, have begun to recognise the potential of the export services sector, a host of Latin American countries too are taking the same route, the survey pointed out.
 
Sri Lanka and Pakistan, which entered AT Kearney's latest index for the first time, offer many of the same advantages as India, with similar labour costs, widespread use

of English, strong education systems and increasingly open and well-regulated business environments.

However, both countries have only recently woken up to the enormous opportunity of the offshore services sector and therefore lack India's breadth and depth of experience. These two countries are also disadvantaged by their relatively smaller population-base and obvious concerns over internal security, the survey said.
 
Although India ranks high overall, because of its skilled and technically superior pool of manpower, it suffers on the two other parameters - financial attractiveness and business environment rankings.
 
In terms of people skills India ranks second, behind US (tier II cities) but ahead of China and Germany. As per business environment rankings, India is placed at 34th, while Singapore comes top, followed by Germany and UK. The survey said when it comes to cost effectiveness, Vietnam, with one of the lowest telecom costs in world, comes on top.