"unskilled indian labour" huh? There are tens of Indian entrepreneurs who have set up Billion dollar companies in US. Don't forget that Microsoft and Google CEOs are Indian too!!
I've personally worked with many very talented people from India. None of them were taking work on freelancer sites.
The only reason why its Indian right now is because British occupation taught them English. It also doesn't hurt that they have the second most populous country in the world.
And I know its anecdote, but I've met a number of fakers here in the US. Nothing special or "Indian-like" that makes lying about your abilities.
Then again around 08 I considered padding and lying about my resume. Nothing I couldnt do, but it does look more acceptable to put down a bankrupt business as a source. Hard to.. Check.
It's Indian because they speak English, they're rapidly getting more online, and they have low cost of living.
Skilled Indian tech workers can outbid skilled and unskilled Western workers, but unskilled Indian workers are abundant enough to outbid everyone else.
Then as a proof I sent them my country Wikipedia link, letting them understand my small country is not a region of India, and India is our neighbouring country.
Then the company apologises by issuing an annual increment...
This thing still surprises me and also i had to face few worst days of my life -_- due to this fact ...