Outsourcing to India driving Indian salaries up

According to this article on News.com, demand for outsourcing to India is causing a 14% annual increase in Indian salaries. As is elementary to economics, as the demand increase and supply stays the same, the price goes up. What does this mean? In the short term, it still means that India is drastically cheaper than America. In the not-so-short term it means that companies may seek to find places where wages are cheaper.

From the article:
"Though it is too early to predict any sort of bubble on the horizon, the rise in India's salaries could prompt more U.S. companies to consider other parts of the world, where wages are far lower. Indeed, even some Indian companies have begun offshoring their own work to China."