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Two Indian cities among world's top 20 outsourcing hubs

July 24, 2013 09:26 IST


Photographs: Vivek Prakash/Reuters

The Global Innovation Index 2013, which is co-published by Cornell University, Insead and the World Intellectual Property Organisation by sheds light on the factors leading to the excellence of innovation hubs, such as the role of local ‘champions’ (large corporations), the availability of funding for the development of start-ups, and the importance of path dependency.

Linkages among stakeholders (governments, firms, academia, and society) in the development of innovation capabilities - such as the existence of incubators and technology transfer programmes and the interaction of innovation clusters with local, inter-regional, and global networks and value chains - are included in the analyses.

Let's take a look at top 20 outsourcing cities in the world.

Source: Global Innovation Index

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Two Indian cities among world's top 20 outsourcing hubs

Image: High rise commercial and residential buildings in Shenzhen, China.
Photographs: Tyrone Siu/Reuters

Shenzhen

Country: China

Rank in outsourcing: 1

The globalisation of the world economy has brought about a growing internationalisation at the regional level. Regions have increased their ties with foreign regions, both in terms of collaborations for innovation and in terms of new linkages deriving from the new forms of innovation organization; in fact, companies have started to delocalise research and design activities that had previously been kept in-house.

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Tags: China

Two Indian cities among world's top 20 outsourcing hubs

Image: An aerial view of mobile phone maker Nokia's headquarters in Espoo, Finland.
Photographs: Benjamin Suomela/Lehtikuva/Reuters

Espoo

Country: Finland

Rank in outsourcing: 2

This unbundling of the production and innovation processes and the new knowledge-intensive FDI are contributing to the generation of new alliances among regions and cities located in different countries, especially in emerging economies.

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Two Indian cities among world's top 20 outsourcing hubs

Image: A man takes of photo of another man who is standing inside one of a number of crop circles in a wheat field near the town of Fairfield in California.
Photographs: Tim Wimborne/Reuters

Fairfield

Country: The United States

Rank in outsourcing: 3

These new forms of FDI are targeting not only main regions and capital cities; more and more they are targeting new places characterised by growing domestic demand and/or by territorial clusters of scientific and knowledge capabilities.

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Two Indian cities among world's top 20 outsourcing hubs

Image: Stanford University doctoral students Peter Abbeel, left, and Adam Coates, right, are joined by computer science professor Andrew Ng prior to an air-show of robotic helicopters on the Stanford campus in Palo Alto, California.
Photographs: Robert Galbraith/Reuters

Palo Alto

Country: The United States

Rank in outsourcing: 4

These new forms of FDI have primarily benefited those places that have implemented specific policies targeted to attract these types of investments, including cities in different countries, including Brazil, China, Costa Rica, India and the United Arab Emirates.

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Two Indian cities among world's top 20 outsourcing hubs

Image: A view of Seattle Great Wheel (bottom) and a Washington State ferry boat on the Elliott Bay waterfront in Seattle.
Photographs: Anthony Bolante/Reuters

Seattle

Country: The United States

Rank in outsourcing: 5

The FDI Market database collects information on greenfield investment projects. These data can be broken down to the city level.

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Two Indian cities among world's top 20 outsourcing hubs

Image: A view of Gangnam area down the Han River in Seoul, South Korea.
Photographs: Lee Jae-Wone/Reuters

Seoul

Country: South Korea

Rank in outsourcing: 6

According to this database, the top five cities for outsourcing innovative FDI activities in 2010-12, as measured by number of jobs created by greenfield investment projects, are Shenzhen (China); Espoo (Finland); and Fairfield, Palo Alto, and Seattle (US).

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Two Indian cities among world's top 20 outsourcing hubs

Image: Three students of San Jose, California, practice their award winning martial arts moves.
Photographs: Lucy Pemoni/Reuters

San Jose

Country: The United States

Rank in outsourcing: 7

Seoul, South Korea, ranks sixth, and has the peculiarity of outsourcing more R&D than design activities.

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Two Indian cities among world's top 20 outsourcing hubs

Image: A view of Bandra-Worli sea link bridge in Mumbai.
Photographs: John Goh/Reuters

Mumbai

Country: India

Rank in outsourcing: 8

Traditional European manufacturing sites, such as Boulogne Billancourt and Paris, also rank among the top 20 cities for outsourcing innovative activities.

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Two Indian cities among world's top 20 outsourcing hubs

Image: IBM headquarters in Armonk, New York.
Photographs: Coolcaesar/Wikipedia Commons

Armonk

Country: The United States

Rank in outsourcing: 9

Since the 2008 economic and financial crisis, innovative FDI has suffered of a sharp decrease.

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Two Indian cities among world's top 20 outsourcing hubs

Image: Traffic on the road and the Thames passes the Houses of Parliament in London.
Photographs: Suzanne Plunkett/Reuters

London

Country: The United Kingdom

Rank in outsourcing: 10

For example, the number of jobs created by greenfield FDI projects in design, testing, and R&D in the top recipient city decreased from 20,000 in 2005–07 to 13,000 in 2010–12, and from 1,500 to 500 in the 20th city in the rankings.

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Two Indian cities among world's top 20 outsourcing hubs

Image: People sit in a coffee garden during a sunny spring day in Killesberg park in Stuttgart, Germany.
Photographs: Christian Charisius/Reuters

Stuttgart

Country: Germany

Rank in outsourcing: 11

The cities that receive the most FDI inflows related to R&D and design are located in emerging economies.

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Two Indian cities among world's top 20 outsourcing hubs

Image: Tourists gather in Times Square in New York City.
Photographs: Charles Platiau/Reuters

New York City

Country: The United States

Rank in outsourcing: 12

Only six out of the top 20 are from European countries; five are from India and three from China.

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Two Indian cities among world's top 20 outsourcing hubs

Image: An aerial view shows the Lagardere Paris Racing sport complex in the Bois de Boulogne, Western Paris.
Photographs: Charles Platiau/Reuters

Boulogne-Billancourt

Country: France

Rank in outsourcing: 13

The top five destinations for design, testing, and R&D are Bangalore, Hyderabad, and Pune in India; Singapore; and Shanghai in China.

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Two Indian cities among world's top 20 outsourcing hubs

Image: A view of the Paris skyline, the Eiffel tower and the Seine River.
Photographs: Philippe Wojazer/Reuters

Paris

Country: France

Rank in outsourcing: 14

Most of the jobs created are in design and testing, while a few are in R&D activities.

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Two Indian cities among world's top 20 outsourcing hubs

Image: Chateau-like Petersberg Hotel on a hilltop overlooks the Rhine river near Bonn, Germany.
Photographs: Ina Fassbender/Reuters

Bonn

Country: Germany

Rank in outsourcing: 15

The flourishing of new clusters of innovative start-ups in emerging economies is contributing to redefine the mapping of world innovation.

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Two Indian cities among world's top 20 outsourcing hubs

Image: Tourists Caro and Anna from Munich lie in a bed mounted to a rental bike as they ride along Friedrichstrasse in central Berlin, Germany.
Photographs: Thomas Peter/Reuters

Munich

Country: Germany

Rank in outsourcing: 15

Yet Silicon Valley is still the reference when thinking about a creative environment where knowledge-based firms flourish.

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Two Indian cities among world's top 20 outsourcing hubs

Image: Mt Fuji, covered with snow, is seen through Shinjuku skyscrapers in Tokyo.
Photographs: Kimimasa Mayama/Reuters

Tokyo

Country: Japan

Rank in outsourcing: 17

In that environment, potential new entrepreneurs can easily make contact with a high-quality and vibrant science community, can interact with big and top innovative firms, and can have easy access to technologies and finance.

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Two Indian cities among world's top 20 outsourcing hubs

Image: Leandro Virgilio, 37, poses in the backyard of his restaurant near Dublin city centre which becomes a bar and club in the evenings.
Photographs: Cathal McNaughton/Reuters

Dublin

Country: Ireland

Rank in outsourcing: 18

Furthermore, the regulatory framework is business friendly and less adverse to risk-taking than it is in other localities.

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Two Indian cities among world's top 20 outsourcing hubs

Image: A rootop view of Amsterdam, the Netherlands.
Photographs: Michael Kooren/Reuters

Amsterdam

Country: The Netherlands

Rank in outsourcing: 19

However, new innovative hotspots where technology-based entrepreneurs cluster together are beginning to appear in other regions.

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Two Indian cities among world's top 20 outsourcing hubs

Image: An outsourcing centre in Bangalore.
Photographs: Vivek Prakash/Reuters

Bangalore

Country: India

Rank in outsourcing: 20

Determining where the new global start-up hubs are and why they perform better in certain locations than in others is a topic of increasing relevance for both national and regional governments.