India Links Visa Flap with Doha Talks

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The U.S Congress is considering reworking U.S. immigration policy. Do you worry that the outsourcing sector could be hurt?

The H-1B visa issue is a trade matter and is not related to the immigration issue. It is a means of fulfilling a trade contract that sometimes requires the temporary movement of people. I do not see any pressure on the outsourcing sector. Just as Indian companies need to send people temporarily to the U.S. to execute contracts, the U.S. companies too need tech manpower, which is in short supply in the U.S.

Without the availability of such talent, their growth and competitiveness in the global market will be affected. A combination of outsourcing work and moving people will be needed. To the extent that there is a trade-off between the two, it is for each company and each country to decide what is the optimum point. However, these decisions must be made without erecting barriers to trade.

We in India have opened up our markets in a big way. Many large contracts from the Indian government have been awarded to US IT companies, despite the availability of local alternatives. Our industry has gone through a painful adjustment, as have Indian workers. In this context, globalization cannot be a one-way street.

What is the way out of this? Aren't most of the Indian IT companies hiring locals in the U.S. and other foreign markets?

Indian companies are hiring local nationals in all the countries that they operate in, and the trend is growing. In fact, many foreign nationals are being recruited to work in India, too, since they prefer that.

Already, in Britain, India is the second biggest overseas investor, creating many thousands of new jobs. In this, the IT industry has been a major player. I do not doubt that we will see the same in the U.S., with Indian companies investing increasing amounts and creating local jobs. They have already begun to do so.

In addition, the H-1B visa holders who come on purely temporary assignments pay Social Security tax in the U.S., even though they are not eligible to receive any benefits for 10 years (by when their visa has long expired).

Would you term this as protectionism by U.S. lawmakers?

Protectionist tendencies are certainly worrisome at a time when we are trying to move towards a more open regime of global trade. We in India have opened up our economy. Even though we have gone through some pains, we have seen the overall benefits to the economy and to the people. We are, therefore, staying the course.

We do hope that those who set us on this path of globalization do not themselves reverse direction. Trade not only creates mutual prosperity, it also develops partnerships and links at all levels, with growing degrees of interdependency and trust.

Nothing can be more important in the world of today than this. Isolation and protectionism, on the other hand, have implications beyond trade with negative worldwide repercussions. I am sure that the U.S., as the economic powerhouse of the world, is conscious of these factors, besides the more obvious economic truisms about the benefits of free trade.