Cognizant Will Open Outsourcing Offices In China

Cognizant Technology Solutions, a provider of offshore IT outsourcing services that operates primarily from India, plans to open an office in China in the next two to three months as part of an effort to become more geographically diverse.

Cognizant executive VP Chandra Sekaran says Cognizant needs to diversify beyond India to ensure business continuity for its customers as a hedge against "geopolitical tension." Hostilities between India and neighboring Pakistan have been simmering for years, and terrorists have occasionally bombed major Indian commercial centers.

Sekaran also says Cognizant needs a presence in China to better service the growing number of multinationals setting up shop in the country and to attract outsourcing customers from Japan. Cognizant also will provide from China application testing services for North American customers.

Cognizant, headquartered in Teaneck, N.J., but with nearly all its operations staff in India, will open an office in Shanghai within two to three months, Sekaran says. The company plans to have 70 to 100 IT employees there, most of them hired locally in China. Analysts have suggested that as labor in India becomes more expensive, outsourcing companies will shift more and more work to China. However, Sekaran says language barriers will prevent more complex projects being farmed out to China.