Saturday, July 3, 2010

IS LEGAL PROCESS OFFSHORING AN EXPORT OF SERVICES?

The cross borders issues generally prevail in the development of countries. This reminds me of an elderly man’s saying “The man on latch of a door control the flow of air from outside to inside & vice versa”. The import & export of goods is decided by different factors like the availability, demand and need. Country intends to export the goods looking into the fact of the ability to produce those goods & get them consumed in other International markets. The motive of export is to earn foreign exchange.

In case of offshoring the services cross border the organisation do not directly earn. However, the cost of those services in-house looks expensive which encourages its outsourcing. Offshoring can be a symbolic way of export when we consider the savings as also forming part of earning. In this services are off-shored to get the same being delivered at low prices. I am not trying to show the offshoring of jobs but the offshoring of services which technocrat offers to one’s clients.

A very simple hypothetical situation can be used to understand the balance of exchequer between two countries. Country ‘A’ exports various high profile and expensive goods to country ‘B’. In terms country ‘A’ needs to settle the balance of payment with country ‘B’ but the same always remain tilted towards country ‘A’. Country ‘B’ has got an excellent pool of people who can deliver good number of services to country ‘A’. This can be the best way to make up balance of payments as far as country ‘A’ & country ‘B’ are concern. Logically the export of goods from country ‘A’ to country ‘B’ can be matched up by export of services by country ‘B’ to country ‘A’.

Is it the way to conclude that export of services is also near to export of goods.
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