Nothing to do with offshoring all jobs...
.....no, nothing at all.
Offshorians are cheap because they're inexperienced, talentless, or both. Unfortunately the bean counters who decide on "location strategy" don't understand enough IT to realise that the offshorians have a similar competency.
If we stopped shipping the entry level jobs to India, we'd stop having unemployed IT graduates, and probably stop RBSing critical parts of our commercial infrastructure.