One of the fundamental tenets of any agile software methodology is the importance of communication between the various people involved in software development. Furthermore agile methods put a large premium on improving communication through face-to-face communication. As the agile manifesto states "The most efficient and effective method of conveying information to and within a development team is face-to-face conversation." Extreme Programming emphasizes this with its practice of a single open development space where the team can work closely together.
Another important facet of the software development world is the move to offshore development model, where much of the development work is done in lower paid, ahem more cost effective countries. Offshore development seems opposed to agile development in a couple of ways.
So the fundamental question is whether agile techniques can be used in an offshore setting. If so how does it compare to using an plan-driven methodology (the term I'll use here for non-agile)?