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Transcription of this question: 5.Out Of IndiaThe direction Of globalization can change unexpectedly India’s leading information andcommunication technology (ICT) companies are under pressure to update their technology and theyalso struggle to cope with rising global demand for their services. Indian universities cannot keepup with the demand for new graduates, leading to wage inflation Of about 15% a year. Moreover,the Indian currency (rupee) has appreciated 9.20/0 against the US dollar during the last year.The increasing cost Of labour in India is forcing the country’s largest ICT companies such asTata Consultancy Services, Infosys and W’ipwv to resort to outsourcing their services to Mexico andhiring Mexican employees at a more reasonable cost. The Mexicans are perceived as professionaland dedicated employees who are very keen to improve their managerial skills.Some Of the Indian ICT companies also set up operations in China where an excess supply Ofwell-trained ICT graduates has kept wage inflation under control. Economic liberalization andrising industrialization make it even easier to operate in the country. However, the operation Ofthe Indian ICT companies in China have made it more difficult for some local ICT businessesto compete.In the USA, Indian-owned companies are hiring more Americans. Some Of the reasons given byWipro are:the work that is done requires more and more knowledge Of local customers’ needs and localpeople do that betterthe US government made the application for temporary working visas to transfer Indian workersto the US more complicatedan Office based in a closer time zone means that employees can Offer customers a quicker service.(a)(b)(c)(d)Define the following terms:(i) globalization(ii) outsourcing.Use all Of the PEST categories to explain four relevant external forces that mayimpact on an outward-looking Indian ICT company.Analyse the impact on a host country such as China Of Indian ICT companiessetting up operations there.Discuss the significance Of the specified external forces and the responses Of theIndian ICT companies to such forces.[2 marks][2 marks][6 marks][6 marks][9 marks]

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