Which of the following statement (s) is/are correct?

Statement 1: Outsourcing has intensified due to advancements in information technology and fast modes of communication.

Statement 2: Outsourcing allows companies to reduce costs and access specialized skills and services from other countries.

Both statements are correct.

As a form of economic activity, outsourcing has intensified, in recent times, because of the growth of fast modes of communication, particularly the growth of Information Technology (IT).

Most multinational corporations, and even small companies, are outsourcing their services to India where they can be availed at a cheaper cost with reasonable degree of skill and accuracy. The low wage rates and availability of skilled manpower in India have made it a destination for global outsourcing in the post-reform period.