Obviously the biggest China outsourincg benefit is their large
supply of lowcost labor.

Apparently even india recognized this china outsourcing benefit
as i've heard that some indian outsourcing firms actually subcontract
their work to India. This of course is a consequence of more and
more US companies stakeholding operations in India and thus
fueling Indian workers' demands for higher wages.

But of course India's not the only one outsourcing to china.
US companies have realized the benefits too, not the
least of which is the fact that much of manufacturing is already
there which means that they already have infrastructure there
to support outsourcing.