Dude, there is a difference between employee salary and CTC. If they hire a local person at 100k, then CTC could be more or less $150K. In addition to that the client can capitalize the entire deliverable cost (in your case $75/hr) they receive from outsourcing vendor, because they buy service/source code from the vendor compared capitalizing its own employee's production (in IT case - source code). Whenever one capitalizes an asset, naturally they can depreciate that asset for tax accounting purposes. Put all this things together, your client saves more than $150K they pay their outsourcing vendor (read your contract house). Bottomline is its profitable for both client and vendor, not because we Indians are (relatively) smarter than locals (depending on region). Also, hardworking in IT companies, is nothing compared hardworking in manufacturing, especially in China, which you already mentioned in your comment.
