Achutha Jois
India's IT sector today dominates global sourcing of IT Services with significant market share, Indian IT service providers compete today with Insourcing within the customer organization across various markets. With global outsourcing growing 2X (twice) faster than global IT spend in-terms of percentage, India remains to be leading destination for global sourcing however emerging economic countries such as east European countries, Russia, China, emerging IT hubs in East Asia are increasingly turning out to be challengers. Some of the question which arises in anybody's mind is how will India take on competition. India's value proposition to the world market is its economies of scale to produce engineers. With the advent of automation and connected world, one can question what will happen to the IT services demand itself. India had cost arbitrage till early 21st century and it is fast eroding. This paper brings in new dimension of complacency which has cropped up among the Indian IT services providers. This paper is an attempt to assess whether Indian IT Industry is caught in dilemma of self projected image. However, the global IT industry is evolving fast and expecting value added, innovative services & products in competitive market. Authors findings was that Indian IT Industry is fast losing its arbitrage advantage, needs to escape out of the mirror prisoner effect.