Though India is the world leader in most types of outsourced activities, there is a notable exception: manufacturing. China has long been a favored destination for companies seeking to offshore their manufacturing tasks.

Yet some experts, including a venture capitalist interviewed in this Hindu Business Line article, think India has a shot at overcoming China's manufacturing dominance in the semiconductor industry -- or at least growing its chip business by providing a viable alternative.

India's industry is certainly taking off, largely because of its growing popularity as a place to design, and not just assemble, the chips. In-Stat expects the country's integrated circuit design services revenue to hit $2.45 billion by 2010, up from $869 million in 2005. During the same period, the number of Indian design engineers will increase from 12,352 to 40,893.

Among the companies that have established operations in India to capitalize on this trend: Dell, AMD, Samsung, Motorola, Nokia and Flextronics. They are taking advantage of economically priced labor, as well as more favorable logistics and tariffs.