Offshoring and outsourcing are the terms often misinterpreted to have the same meaning. But there is a slight demarcation between the two – The shifting of production, manufacturing or services to another country that offers better competitive advantages such as lower costs and fewer regulations is called Offshoring. The complete transfer of business is involved in Offshoring where the head office is present at the onshore region, but the offshore base is the production and development site. Outsourcing on the other hand is the transfer of only a part of the business process to a cost- effective and efficient site. The core process is performed by the mother company whereas the non-core jobs are done by the service provider on the other side of the globe. Business Services are sorted into components and each component is dealt with efficient and cost-effective measures. The practice of outsourcing was prevalent from the 80’s, but the quest for cost-effective and quality work increased offshore software outsourcing in the 21st century. The boom in IT enabled services and the influx of MNC’s spreading their web for outsourcing business processes from Banglore, Gurgaon, Chandigarh etc, have added impetus to offshore software development. Software development has come a long way via offshore outsourcing. Business giants like Infosys and Wipro are the forerunners in offshore software outsourcing. Software development companies outsource services from companies outside their region. Outsourcing any business service, production or manufacturing from an offshore company is known as Offshore Outsourcing and offshore software development is a part of the same frame. Professionals in India offer expertise in software development, custom software development, web application development, web programming, application development, business process outsourcing, content management etc. The Indian service providing market is a huge cauldron with prime factors such as cheap labour, cost- effective production, quality work and a population that can understand and converse in English attracting more American business groups seeking trust in Indian talent and excellence. These are not the only factors that make India a golden bird in offshore outsourcing. The dual effect of technical brilliance and the advent of information technology suffice the requirements for outsourcing software development from India. The time zone creates differences in the working hours of both America and India, but this has proven to be a boon as the working process continues round the clock. The offshore companies that have their base established in India generate revenue more than what they would generate if they had used their own task force for developing software. Apart from the above mentioned qualities, Offshore Software Development in India has also supplied with more and more job-opportunities, thereby solving unemployment crisis. Countries like America and UK feel secure in outsourcing services from India as they tap the Indian talent and brilliance at a far cheaper rate. But, a question may arise as to whether there is frequent communication between the offshore and onshore base? Indian offshore software companies maintain their communication with the onshore base regularly for development and maintenance of software. Before the software is brought on floor, the production site sits with the onshore base for a healthy business discussion either by a face to face interaction or through voice support, mail or chat. Also, the development is executed on the basis of a process model prescribed in accordance with the onshore style of working. India has in all such contexts proven to be the best option for offshore outsourcing of software development.