India has been dominating offshore outsourcing market since its opening. Despite the cultural differences the majority of American companies considered India the best place to outsource jobs to, mainly because of the cost benefits. However, the decline of the U.S. dollar against other currencies including the Euro, Yen and the Indian Rupee makes most countries such as India, China, Russia and number of European countries less competitive in offshore development. The currency exchange trends give Belarus a competitive advantage in terms of its outsourcing potential. In addition to other benefits that Belarus has to offer, exchange rate factor gains momentum: BRB/USD exchange rates are fixed and the value of the Belorussian ruble follows that of the dollar.
Since the rupee has appreciated by 8.9 percent against the US dollar in 2007-2008, Indian outsourcing companies now have to compete with the countries that have more favorable dollar exchange rates. The following graph shows the recent dynamics of INR/USD exchange rates.
(source www.exchange-rates.org)
The rising appreciation of rupee against dollar and West Asian currencies is not the only challenge for Indian outsourcing providers. Indian economy is overheating with excessive demand pushing prices even higher. Considering the current account deficit the U.S. has got with China future looks very promising for Belorussian outsourcing companies. But the favorable situation on the currency exchange markets is not the only advantage Belarus has got.
(source www.exchange-rates.org)
Considering the future we see the Belarus keeps BRB on the same exchange rate to the USD thus maintaining this advantage to other outsourcing destinations.
