The Philippines, Vietnam and India are the three destinations that dominate offshore software development in Asia, and they suit very different buyers.

India has scale nobody else approaches. The Philippines has the best English in the region by a wide margin. Vietnam has become the quality-per-dollar pick for engineering-heavy work. But the factor that should probably decide your shortlist first is not any of those, it is where your own office is, because the time zone maths differs enormously depending on whether you are sitting in Sydney, London or New York.

This guide covers cost, talent depth, English, and the legal picture for each, which matters more than usual this year. Both Vietnam and India brought in significant new data protection regimes over the past twelve months, and most content on these countries has not caught up.

Philippines vs Vietnam vs India At A Glance

Factor	Philippines	Vietnam	India
Tech workforce	Around 1.9 million in IT-BPM, of which roughly 190,000 in IT and digital services	Around 530,000 software developers, 1.5 million across the wider IT sector	Around 5.95 million across the technology industry
English (EF EPI 2025)	High, score 569	Moderate, score 500	Low, score 484
Senior rate, via agency	$35 to $50/hr	$40 to $50/hr and up	$40 to $70/hr
Time zone	UTC+8	UTC+7	UTC+5:30
Sector scale	IT-BPM revenue $40.3bn in 2025, targeting $42bn in 2026	Roughly 57,000 tech graduates a year	Industry revenue $315bn in FY26, exports around $246bn
Data protection	Data Privacy Act 2012, stable	New Personal Data Protection Law, in force 1 January 2026	DPDP Rules notified November 2025, phased to May 2027
Best suited to	Client-facing work, support, teams needing fluent communication	Engineering-heavy delivery at competitive cost	Scale, specialist depth, enterprise programmes

The Time Zone Question, Which Decides More Than People Expect

All three countries sit between UTC+5:30 and UTC+8. What that means for you depends entirely on where you are, and it is the single biggest reason the same three countries are an obvious choice for one buyer and a poor one for another.

Your office	Offset to Manila	Offset to Ho Chi Minh City	Offset to Bengaluru	Practical verdict
Sydney	2 to 3 hours behind	3 to 4 hours behind	4.5 to 5.5 hours behind	Excellent, a normal shared working day
London	7 to 8 hours ahead	6 to 7 hours ahead	4.5 to 5.5 hours ahead	Workable, your morning is their afternoon
New York	12 to 13 hours ahead	11 to 12 hours ahead	9.5 to 10.5 hours ahead	Hard, needs a shifted roster on one side

For an Australian company this region is genuinely nearshore in everything but name. Manila is closer to Sydney’s working day than Perth is to Auckland’s. For a UK company it is workable with intent, since a London morning stand-up lands in the Asian afternoon, and India is the easiest of the three because it is only four and a half to five and a half hours ahead. For a US company on the East Coast, none of these is comfortable, which is why American buyers overwhelmingly look to Latin America instead, and why so much of the offshore content written for US readers undersells this region.

The practical implication: if you are in the US and still want Asia, buy outcomes rather than hours. Fixed-scope delivery works across a twelve-hour gap. Embedding someone in your daily stand-up does not, unless somebody is working nights.

The Philippines

The Philippines is the communication pick, and the gap is not marginal. It scores 569 on the 2025 EF English Proficiency Index, placing it in the “high” band, comfortably ahead of Vietnam and India and in fact ahead of most of Latin America. English is an official language, higher education is largely conducted in it, and the outsourcing sector has spent three decades selling to American and Australian clients.

That shows up in what the country is good at. The IT-BPM sector generated $40.3 billion in revenue in 2025 across about 1.89 million full-time employees, and is targeting roughly $42 billion in 2026. But the bulk of that is business process work rather than software engineering. IBPAP’s own 2026 figures put information technology and digital services at around 190,000 full-time employees and $6.1 billion, roughly 15% of sector revenue, which is a real but much smaller pool than the headline number implies. If you need twenty React engineers, the Philippines can do it comfortably. If you need two hundred, look elsewhere.

One thing worth knowing that most guides to the country have not absorbed. In July 2026 IBPAP substantially cut its own 2028 roadmap, moving the revenue target from $59 billion down to a range of $43.3 billion to $50.5 billion, and the headcount target from 2.5 million down to 1.85 to 2.14 million. The association attributed the revision to rapid AI adoption, shifting buyer behaviour and tougher global competition, and reframed the goal around 2 million AI-enabled workers rather than raw headcount. Note that the bottom of that new range sits below today’s employment, so the sector is now planning for the possibility of contraction. That does not undermine the Philippines for software engineering, which is the part least exposed to the voice and back-office automation driving the revision, but anyone being sold a pure growth story about the country should know the industry body itself has moderated its outlook.

Rates through an agency typically run $18 to $25 an hour for junior developers, $25 to $35 for mid-level and $35 to $50 for senior.

The other structural consideration is weather. The Philippines sits in a typhoon belt and takes several significant storms a year, which occasionally disrupts power and connectivity in affected regions. Established providers plan for it with redundant sites and work-from-home fallbacks, and it is a reasonable question to ask any vendor rather than a reason to avoid the country.

Vietnam

Vietnam has spent the past decade moving from a cheap alternative to a genuine engineering destination, and it is now where a lot of buyers land when they want technical depth without Indian scale or Philippine rates.

The developer pool is around 530,000, within a wider IT workforce of roughly 1.5 million, with about 57,000 tech graduates entering each year on government figures. That is a fraction of India’s but concentrated in exactly the kind of work most buyers want: web, mobile, backend, QA and cloud. Major hardware and AI investments from the likes of Samsung and Qualcomm have pulled additional capability into the country.

Agency rates typically run $20 to $30 an hour for junior, $25 to $40 for mid-level and $40 to $50 and up for senior, putting Vietnam slightly above the Philippines at the top end and below India’s specialist tier.

Two caveats. English sits at 500 on the EF index, which is the bottom edge of the “moderate” band, so communication is workable but noticeably weaker than the Philippines and worth testing directly rather than assuming. And the market tightens sharply for senior ownership, advanced English, AI or data depth, and platform engineering maturity, which is where hiring competition from the incoming multinationals bites hardest.

Vietnam also introduced the most demanding new data regime of the three this year, covered below.

India

India is not really comparable to the other two on scale. Nasscom puts the technology industry at $315 billion of revenue in FY26, up 6.1%, with exports of $246 billion and headcount at 5.95 million after adding roughly 135,000 net new people. No other offshore destination is within an order of magnitude. If your requirement is unusual, large, or both, India is frequently the only country that can actually staff it.

That scale also produces the widest rate range of the three. Agency rates run roughly $18 to $25 an hour for junior, $25 to $40 for mid-level, and $40 to $70 for senior and specialist engineers, with the top of that band reflecting genuinely scarce skills rather than padding. India is not automatically the cheapest option, which surprises people. It matches Vietnam at mid-level and runs above it at the senior end, and the Philippines undercuts both for mid-level and senior work.

The two things to plan around are English and churn.

English scores 484 on the EF 2025 index, in the “low” band, which is the weakest of the three. That national average is misleading for the enterprise end of the market, where engineers at the large service firms communicate well, but it does mean you cannot assume fluency at the market level and per-team assessment matters.

Attrition is the more practical issue. The largest Indian IT services firms were reporting trailing-twelve-month attrition around 13% to 14% in the June 2026 quarter, with TCS at 13.6% and Infosys at 13.0%, and the trend edging up rather than down. That is far better than the pandemic peak, when Infosys hit 28.4% and several peers ran above 22%, but niche AI and cloud roles still churn at 18% to 25%. On a multi-year programme you should assume meaningful turnover in your team and ask vendors directly about handover practice, documentation standards and named-person continuity.

Rates Compared, And The Number That Actually Matters

The table below is agency and vendor billing rates, which is what you pay.

Be aware that the gap between the billed rate and what the engineer actually earns is far wider in this region than most buyers assume, and wider than in Western contracting. Local compensation for a senior Vietnamese back-end developer with more than eight years of experience has a median around 54.9 million dong a month, which works out near $12 an hour against a billed rate of $40 to $50. Average annual developer compensation across these markets sits roughly in the $9,000 to $12,000 range. So the billed rate is commonly three to five times the engineer’s pay, not the one and a half to two times typical of US or UK staffing arrangements.

That is not automatically a scandal. The difference funds employer taxes and statutory benefits, recruitment, management, QA, bench cover, office and equipment, and margin, and a good provider earns much of it. But it does mean two things. Offshore savings are structural rather than something you are extracting from an underpaid individual, and the quoted hourly rate tells you very little about whether the engineer working on your product is well paid enough to stay.

Seniority	Philippines	Vietnam	India
Junior	$18 to $25/hr	$20 to $30/hr	$18 to $25/hr
Mid-level	$25 to $35/hr	$25 to $40/hr	$25 to $40/hr
Senior	$35 to $50/hr	$40 to $50/hr and up	$40 to $70/hr

Be careful comparing these against numbers you see elsewhere. A great deal of offshore marketing quotes developer-level pay for the offshore country and agency-billed rates for your home market, which manufactures a gap wider than the real one. Compare billed against billed. And ask any prospective vendor what proportion of the rate reaches the engineer. The answer tells you both what you are buying and how straight the vendor is.

What About Indonesia And Malaysia?

Both come up in conversation and both are legitimate places to build software, but neither has the established offshore delivery market of the three above, and buyer demand for them is a fraction of the others.

Indonesia has the largest domestic technology sector in Southeast Asia by users and a fast-growing startup scene, which makes it interesting for companies serving the Indonesian market directly rather than as a pure delivery location. Malaysia sits at a higher cost point with strong English and good infrastructure, and tends to suit shared services and regional hubs more than arms-length outsourced development. If you are choosing purely on delivery capability and vendor maturity, the Philippines, Vietnam and India are where the depth is. If you have a commercial reason to be in Jakarta or Kuala Lumpur, both work.

Data Protection, Where Two Of Three Changed This Year

None of these countries benefits from an adequacy arrangement of the kind that makes EU-to-EU or UK-to-EEA transfers frictionless. Wherever you are sending personal data, you are relying on contractual protections and your own due diligence, and in Australia’s case the sending entity remains accountable for what the overseas recipient does with it. What has changed is that two of the three destinations now have significantly more demanding domestic regimes.

Vietnam, the strictest of the three

Vietnam passed a Personal Data Protection Law (Law No. 91/2025/QH15) on 26 June 2025, effective 1 January 2026, replacing the earlier Decree 13/2023, with implementing Decree 356/2025/ND-CP issued at the end of December 2025 and effective alongside it. It is a substantial step up. Data processing and transfer impact assessments are mandatory, with a five-year grace period for small businesses and startups and an exemption for micro-enterprises. Breaches must be reported within 72 hours. Personal data cannot be bought or sold except in narrow circumstances. Penalties for cross-border transfer violations specifically reach 5% of the violator’s prior-year revenue.

The implementing decree adds the operational detail that catches people out: a cross-border transfer dossier must be filed with the Ministry of Public Security within 60 days, a data protection officer is mandatory, responses to data subjects run to fixed deadlines of 10, 15 or 20 days depending on the request, records must be kept for five years, and the authorities can suspend transfers. If your engagement involves personal data flowing into Vietnam, this needs looking at properly rather than assuming the vendor has it covered.

India, phasing in through 2027

India’s Digital Personal Data Protection Rules were notified on 13 November 2025. Obligations phase in over roughly eighteen months: the consent manager framework becomes operational on 13 November 2026, and full compliance is required by 13 May 2027. The regime brings standalone privacy notices, 72-hour breach notification, mandated security safeguards, processor contracts and deletion obligations. The Data Protection Board was established in law at the same time, though as of late 2026 its chairperson and members had not been appointed and the selection process was still running, so enforcement machinery is not yet operating.

There is an exemption for processing the data of individuals outside India under contract, at section 17(1)(d), which is frequently described as covering standard outsourcing. Treat that carefully. Several obligations continue to apply regardless, it does not hold where the contract is with an Indian entity, and it covers neither Indian data subjects nor the vendor’s own employees. Confirm it against your actual arrangement rather than assuming it applies.

The Philippines, the stable one

The Philippines has operated under its Data Privacy Act since 2012 with an established regulator and no statutory overhaul, which is a modest point in its favour if you would rather not track a moving regime. It is not entirely still, though. The National Privacy Commission formalised mandatory breach notification through its online system during 2026, and a draft circular issued in August 2026 would replace the blanket privacy impact assessment requirement with mandatory assessments for specific categories, including AI and biometric processing and cross-border transfers to jurisdictions without adequate protection. That last category is worth watching if you are the one sending the data.

This is a summary rather than advice, all three regimes are detailed, and anything involving significant volumes of personal data warrants proper counsel in the destination country.

How To Choose

If communication quality is the priority

The Philippines, clearly. It is the only one of the three in the EF index’s “high” band and the gap over Vietnam and India is large. For anything client-facing, support-adjacent, or dependent on unscripted discussion, this is the differentiator.

If you need scale or unusual specialisms

India, and it is not close. A 5.95 million person industry can staff requirements the others simply cannot, and the specialist tier is deep even if it prices accordingly.

If you want engineering quality per dollar

Vietnam, for most mid-sized product work. Rates sit between the other two, the developer pool is concentrated in mainstream commercial stacks, and the market has matured considerably. Budget extra scrutiny for English and for genuinely senior ownership roles.

If you are in Australia

Any of the three, and this region should be your default rather than Latin America or Eastern Europe. The time zone alignment is the best available to Australian buyers anywhere.

If you are in the United States

Consider whether you want Asia at all for embedded team work. For fixed-scope delivery it is fine. For engineers in your daily stand-up, Latin America will serve you better on overlap alone.

Frequently Asked Questions

Which country has the best English for outsourcing?

The Philippines by a clear margin, scoring 569 on the 2025 EF English Proficiency Index and sitting in the “high” band. Vietnam scores 500, at the lower edge of “moderate”, and India 484, in the “low” band. National averages understate the enterprise end of the Indian market, where communication is generally strong, but they do mean fluency cannot be assumed at the market level in either Vietnam or India.

Is India the cheapest?

Not reliably. The Philippines undercuts it at both mid and senior level, India matches Vietnam in the middle of the range, and India’s senior and specialist band reaches $70 an hour through an agency. India’s advantage is depth and availability rather than headline price.

How bad is attrition in India?

Better than its reputation, though no longer improving. The largest IT services firms were around 13% to 14% trailing attrition in the June 2026 quarter, with the trend edging up, against a pandemic peak where Infosys reached 28.4%. Niche AI and cloud roles still run 18% to 25%, so on long programmes plan for turnover and ask vendors about documentation and handover practice.

Does Vietnam’s new data law affect my project?

Possibly, if personal data is involved. The Personal Data Protection Law took effect on 1 January 2026, imposes impact assessments and 72-hour breach reporting, and carries penalties of up to 5% of prior-year revenue for cross-border transfer breaches. It is the most demanding of the three regimes and worth confirming with counsel rather than relying on vendor assurance.

Which is best for an Australian company?

All three work well from a time zone perspective, which is not true for US buyers. Manila sits two to three hours behind Sydney, Ho Chi Minh City three to four, and Bengaluru four and a half to five and a half. Choose on English, scale and cost rather than on overlap, since overlap is a solved problem from Australia.

What should I ask a vendor before signing?

What share of the billed rate reaches the engineer, who owns the people and directs them day to day, what happens on handover when someone leaves, and how they handle personal data under the destination country’s current regime. The answers to those four separate serious providers from resellers quickly.

The Bottom Line

Start with your own clock. If you are in Australia, this region is effectively nearshore and the choice comes down to English, scale and price. If you are in the UK, it works with a little planning, with India the easiest of the three on overlap. If you are on the US East Coast, Asia is a fixed-scope delivery option rather than an embedded-team one, and Latin America will usually suit better.

Beyond that: the Philippines for communication, India for scale and specialism, Vietnam for engineering value in between. And check the legal position properly, because Vietnam and India have both moved this year and a lot of published advice on both is now out of date.

For shortlists, see our roundups of top software development companies in the Philippines and in Indonesia, and for the regions this guide compares against, our nearshore roundup and country comparison of Mexico, Colombia, Brazil and Costa Rica.