Indians are obviously a better choice as they can be exploited (as the Indian Programmers have to work on H1B VISA), there would be no fixed working hours, low pay and some kind of patriotism expected out of the Indian employee. Even in India these computer software firms exploit the Indian programmers by making them work for way more hours than they should, I mean working on Saturdays, almost 10 hours a day (on an average including Saturdays) and this is very common. This is why outsourcing is being done, not because the code is written in a better fashion but the Indian employee is more gullible (would bend over backwards) rather than an American grad, these outsourcing companies are having what I would like to call "Sweat shops". Everyone can be exploited in the name of Patriotism, and this what the Indian employer (HCL CEO) is saying, India/Indians provide him with cheap labor, him being Indian knows how to deal with them (nobody in the US is going to take that).
Never believe the lies these guys propagate, summing up the situation in India. Low pay, irregular working hours (always on the call), can get fired anytime (forcing the employee to work extra hours without getting compensated for). The thing about sexual preference, do you really think that the Indian employer would hire a gay/lesbian that's never happening in India at least, you might get fired for being straight and promiscuous.