The work itself is being done by a translator on the Western Isles who was drafted in by the Indian company.

Holyrood has two Gaelic language staff but they do not carry out translation work.

UK-based firm Format Design is contracted to produce Holyrood's publications but it sub-contracted the annual report translation work after the Bangalore-based operation offered to do the work for 6p per word.

The Indian firm - effectively the "middle man" in the deal - has a database of freelancers and one of these on the Western Isles did the translation.

A spokesman said Holyrood's in-house Gaelic staff focuses on areas such as education.

Former Minister for Gaelic Peter Peacock, who believes the annual report should be translated, branded the episode “bizarre”.

He said: “To have Gaelic translations of the Parliament’s annual report pinging back and forth between Bangalore and Scotland and saving 40% of the cost in the process beggars belief.

“I hope offshoring this work is not an underhand way of trying to drive down Gaelic translators’ wages - the (Western Isles) economy is fragile enough as it is.

“No doubt the people of Bangalore will be rubbing their hands in glee at yesterday’s Scottish Government announcement of more cash for Gaelic - who knows what more opportunities it will bring to them for business.”

He said: “The Scottish Parliament contracts out the design and translation of its annual report.

“The company sub-contracts the translation element, choosing a company that offers best value for money.

“The Parliament was not involved in the decision on sub-contracting.

“The actual translation of the annual report from English into Gaelic was carried out by a Gaelic translation service - based in Scotland - with an in-depth, professional knowledge of the language.

“We do not employ translators for any language. In terms of Gaelic we have two full-time posts focusing on Gaelic education and development.”

First Minister Alex Salmond yesterday announced an extra £800,000 in funding for Gaelic education, bringing the total above £2 million this year.

A FIRM in India has been given a contract to translate the Scottish Parliament's annual report into Gaelic, it has been confirmed.