Discuss the impacts of globalization on the location of IT industry.

The Globalization means increased interdependence and interactions due to flow of goods, services, persons, capital, and ideas across the borders. This gave rise to the development of IT industry in India, which is a foot loose industry.

Globalization’s impact on the location of IT industry:

  • Movement of IT companies from western countries like USA & Europe to developing countries like India because of comparative advantage.
  • India has the comparative advantage than western countries due to availability of cheaper, productive and English-speaking labour force.
  • Business process outsourcing (BPO) leads to outsourcing of the back end work of the major companies like Google, Microsoft to Indian IT companies.
  • H-1B visas allowed free movement of personnel from India to USA on temporary basis.

As IT sector is one of the India’s success stories, momentum in this sector growth needs to be sustained for producing good and well-paid jobs.


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