in reply to Open Source Funding: Developing Countries Better?
(I presume you are not proposing just picking the lowest bidder for a project - which is an entirely different kettle of fish from outsourcing :-)
As you pointed out low-wage/high-wage is related to the local cost of living. You need to check whether they are getting a good wage, not translate the amount into the currency of another country. If it's a good local wage then you are not taking advantage in my book.
Since, I imagine, most of these projects will be fairly self-contained I doubt there will be the problems with customer/developer communications and remote project management that sometimes occur with outsourced projects. Much OS development is distributed anyway. It certainly won't be any worse than US/European collaboration.
If they can do the job then go for it.
The only other issue I can see being a potential problem is meeting people. Its obviously more expensive for somebody in, for example, India to make a US or European conference so budgets for travel, etc. will have to be adjusted accordingly.