The early 2000s mark a period of sometimes breathless commentary about India’s place in the global software industry. “Offshoring” had become a watchword, an emblem of shifting economic gravity, and an object of anxiety and ambition in equal measure. But for those hoping to measure the actual contours of the boom, the statistics present as much challenge as clarity. ISIC 6201—computer programming activities—serves as the natural, if imprecise, starting point. Yet, as with so many industrial codes, the detail required to really grasp what’s happening lies somewhere beneath the surface.
The first step is to collect all Indian firms registered under ISIC 6201 as of 2003. Here, the numbers are daunting: a vast registry populated not just by the well-known giants, but by thousands of small and midsize companies—some longstanding, others newly minted in anticipation of global demand. Sorting these firms according to their actual involvement in offshored services isn’t trivial. Descriptions in registration data are often bland, sometimes willfully vague. Many companies use the same code regardless of whether they specialize in bespoke enterprise systems, mobile games, or accounting process automation.
Distinguishing the firms directly involved in offshoring requires triangulation with export data. India’s Ministry of Commerce, NASSCOM, and industry trade reports often maintain lists or at least rough estimates of firms earning the majority of their revenue from international contracts. Export earnings become a critical filter. For large, publicly traded firms, annual reports tend to be explicit about the share of revenue derived from clients outside India. Smaller firms, however, typically disclose less, if at all. In such cases, interviews, media coverage, or even employment advertisements referencing overseas projects can help build a partial picture. Admittedly, it’s a patchwork.
Integrating export revenue data with the registry of ISIC 6201 firms gives a first cut—a working set of companies most likely to be participating in the offshoring wave. The next step is to probe the cost structure. Labor cost differentials were the engine of the model, and the subject of no small debate among economists at the time. International financial institutions, management consultancies, and India’s own industry associations published occasional studies benchmarking average salaries for software engineers and support staff in India against those in the US, UK, or EU. The numbers shifted from year to year, but the overall ratio—often cited as a fraction, sometimes as a multiplier—formed the bedrock of competitiveness calculations.
The ideal is to match export revenue streams to labor cost data at the firm or, failing that, sectoral level. A few large companies broke out their wage bills and revenue by division, sometimes even by client geography. Most, however, presented only consolidated figures. When the firm-level connection proves elusive, sectoral averages can be combined with known export revenue totals to estimate the implied wage advantage. It’s not perfect; some firms paid significant premiums for niche skills, while others operated with razor-thin margins. Still, the broad outlines emerge: revenue earned overseas, wages paid domestically, margins dependent on keeping the balance just right.
One practical challenge is timing. Contracts are sometimes signed years in advance of when revenue is recognized. Exchange rate movements introduce further noise—dollar earnings one year might buy much more, or less, in rupees the next. Analysts have sometimes tried to control for these fluctuations by indexing results to purchasing power parity or adjusting for major policy changes (such as liberalization of foreign exchange rules), but the work remains subject to revision.
A complementary angle comes from employment statistics. The most successful offshoring firms, almost invariably, grew headcount rapidly—sometimes exponentially. Tracking job creation alongside export revenues adds another layer, one that illustrates not just economic gain, but also the social effects of the offshoring boom in urban India. The rise of new tech hubs, changes in local consumption, even shifting aspirations for a new generation of workers—these are visible in the numbers, but only just.
Documentation, as always, is paramount. Every decision about how to assign export revenue, every estimate of labor cost, every reconciliation of firm- and sector-level data should be recorded. Some ambiguity is inevitable. Company strategies changed quickly. New entrants appeared; others merged, pivoted, or quietly closed down. The churn is part of the story.
What emerges is a landscape shaped by the confluence of policy, entrepreneurship, global integration, and cost arithmetic. The contours are not always sharp, and the pathways are rarely as linear as they appear in hindsight. Still, through ISIC 6201, export revenues, and careful attention to labor costs, it is possible to track how India’s offshoring boom was built—step by imperfect step.