2013 August 20 « Dr Alf's Blog

Outsourcing to India (Photo credit: markhillary)

Yesterday, I reblogged a Reuters‘ article entitled “Indian rupee sags to record low despite government steps“.

Traditionally, when currencies fall the cost of imports rises but it becomes easier for exporters to World markets. In recent years, one of India’s biggest growth industries has been the outsourcing industry. Outsourcing basically sell services overseas, so it’s an export; so Indian outsourcing will benefit from the lower Rupee?

India’s outsourcing industry has run into difficulties in recent years. Costs have risen on the back of inflation and World markets have continued to question service levels, so there has been a trend from offshoring to the likes of India to nearshoring or indeed reshoring services back to developed countries. Also China has been going head-to-head with India to secure a share of the global outsourcing market and China could well be the eventual winner.

So is the lower Rupee good for Indian outsourcing?

The answer is probably not. Contracts are for long time periods, possibly priced in US Dollars and may well preclude foreign buyers from benefiting from the lower Rupee rate; so this will cause buyers to question further the effective offering of the Indian outsourcing sector focusing on the negatives.

Let me turn this to an open question:

Will Indian outsourced service providers benefit from the lower Rupee?

Any thoughts?

Indian rupee dives to record low against dollar (thisismoney.co.uk)
Indian rupee sags to record low despite government steps | Reuters (dralfoldman.com)
Rupee plunges to lifetime low‚ past Rs 100 per USD (thehimalayantimes.com)
Indian Rupee Collapses – Worst Day In 20 Years (zerohedge.com)
The volatile journey of Indian rupee since independence (news.in.msn.com)
Indian rupee falls to new low on Monday (thebricspost.com)
Rupee hits record low against dollar (bbc.co.uk)
Indian rupee dives to record low against dollar (dailymail.co.uk)
Rupee hits 63.77 against dollar to fresh record low (profit.ndtv.com)
Falling rupee has little impact on Indian tourists (dnaindia.com)

English: British politician Ed Miliband, Leader of the Labour Party (2010–) Deutsch: Der britische Politiker Ed Miliband, Vorsitzender der Labour Party (2010–) (Photo credit: Wikipedia)

Dr Alf is right on both counts about Ed Miliband.

However Ed Miliband‘s problems go a lot deeper than just lack of leadership and “growing up”.

To begin with no-one really knows what the Labour Party stands for any more, since it has abandoned its traditional supporters who are either dead or very old anyway.

Secondly Ed Miliband is not trusted or liked by the electorate because of his betrayal of his own brother for the sake of his own political ambitions.

People rightly feel that if someone puts their own ambition ahead of family duty that they are the sort of people who would sell their own grandmothers if the price was right.

Thirdly Ed Miliband is no Hollywood movie star, he is not telegenic as Blair was, his body language, syntax and attempts at high moral tone simply jar with the message he is trying to put across and makes him appear insincere.

Fourth, his failure to have his name put of his child’s birth certificate 11/2 years after fathering it does not strike me as the act of a caring man or one who cares about details (The line from the first Godfather movie where the fictional Mafiosi Don Corleone says”woman and children can afford to be careless but men cannot”), whilst sexist in nature contains the element of truth for Miliband”men cannot afford to be careless”

Fifth, Miliband is surrounded by intellectual lightweights who are lazy, do not master their subject matter (Chris Bryant) and are useless communicators, hypocrites (Diane Abbott) and so laid back that they are almost horizontal (nearly all of them)

Sixth, Miliband has never had to strive or struggle for anything and is a Rothschild puppet dancing to his master’s tune as is David Cameron who is at least telegenic along with his own version of insufferability. People in the country may not know this but they do know that he is in thrall to powerful Trades Unionists and sense, rightly, that he is not his own man.

Seventh, Miliband does not know or care about the lives and travails of ordinary people and like the rest of the political class has failed to show any sense of urgency about the country’s economic problems by not going on holiday and addressing people’s basic concerns.

Lastly, people do not like to think they are being taken for granted but Miliband does this as well.

A look at his smug expression tells anyone with eyes to see that he thinks he will win the next election using the built in jerrymandered 11 point advantage that the Labour Party enjoys to assume power.

His supporters describe this as “Zen like calm” when in reality it is an assumption on his part that the Prime Ministership will be his as long as he waits for others to fail and says nothing about what he might do.

What are the chances he will resign without a coup against him?