Over the past decade, tech services giants Accenture (ACN) and IBM (IBM) were forced to play catch-up with Indian outsourcers that used lower-cost, skilled homegrown labor to undercut their larger rivals.

Now the two bigger guys have caught up and turned the tables, observers say, by basing major outsourcing operations in India.

Conversely, in recent years the India-based tech services leaders have been building their higher-end consulting practices to compete better with Accenture and IBM. They haven't caught up, and observers say it will take the Indian firms much longer to expand upstream than it took IBM and Accenture to move downstream.