Many India pure play firms negotiate global rates – the same rates apply wherever the resources work under T&M, staff augmentation type of contracts. Once agreed upon IT firms work on a ratio that will help them drive towards making sure they can still make profits in the competitive market.

The rates are broadly anywhere from 75% offshore and rest on site or even lower at times to 90% offshore depending on complexity. Most operations nature of work is higher in offshore ratio while more complex development will have around 60% or above. support nature of work falls somewhere in between.

it is important to understand the contract and keep an eye on the ratio on the leverage is not unduly benefiting one side. ofcourse there are always ways to negotiate. Also checking weekly or monthly on how the ratios prevail is a good idea.

Lot depends on how big the contract is. Smaller contracts don’t make a lot of difference while large contracts with more than thousand resources will make a good impact on ratios.

Initially the ratio on site would be higher to gain knowledge and as the learning curve improves the ratios start to level off to contractual levels.