President Obama: offshoring fears are outdated, unwarranted

The president also made a pitch for larger exports from the country to India

The perception that Indian call centers and back office operations cost U.S. jobs is an old stereotype that ignores today’s reality that two-way trade between the U.S. and India is helping create jobs and raise the standard of living in both countries, U.S. President Barack Obama told a gathering of business executives in Mumbai on Saturday.

President Obama’s remarks come after some moves in the U.S. that had Indian outsourcers worried that the U.S. may get protectionist in the wake of job losses in the country. The state of Ohio, for example, banned earlier this year the expenditure of public funds for offshore purposes.

U.S. exports to India have quadrupled in recent years, and currently support tens of thousands of manufacturing jobs in the U.S., he said in a speech that was also streamed live. In addition, there are jobs supported by exports to India of agriculture products, travel and education services.

Indian investment in the U.S. also runs into billions of dollars, and supports jobs in the country, he said.

President Obama, who is in India on a three-day visit, said that more than 20 deals worth about US$10 billion [b] were announced on the first day of his visit. The deals, in a variety of areas including aircraft, turbines, and mining equipment, could potentially create over 50,000 jobs in the U.S., he added.

President Obama said his objective was to create jobs in the U.S., and to rebuild the country’s economy, but it would not be at the expense of the creation of jobs in other countries. The U.S. will instead discover, create and build products that are sold all over the world, he said.

President Obama’s speech is a recognition that jobs cannot be created by protectionism but by a growth in trade, said Som Mittal, president of the National Association of Software and Services Companies (Nasscom). The message for India’s outsourcing industry in the speech was very positive, he added.

India’s top outsourcers like Tata Consultancy Services and Infosys Technologies, have posted strong revenue and profit growth in the quarter ended Sept. 30, and are adding staff by the thousands.

Besides the Ohio decision, the Indian outsourcing industry was hit earlier this year by a $600 million [m] measure for increased surveillance of the U.S.-Mexican border to prevent illegal immigrants. The funds for the bill, which was signed into law by President Obama, are to be raised from an increase in visa fees paid by tech workers brought into the country by companies with more than 50 staff, and in which more than 50 percent of the staff are on these visas.

Indian outsourcers, who send a large number of staff to customer sites in the U.S., were saddled as a result with an increase in visa costs. But they were more alarmed by the threat of increased protectionism from the U.S.

President Obama’s own remarks earlier this year fueled this fear. While proposing to reform the U.S. tax system for companies earning profits abroad, he alarmed Indian outsourcers in May last year when he made a reference to jobs getting created by U.S. companies in Bangalore, the hub of India’s outsourcing industry. The tax code is broken as it's a tax code "that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York", the president said.

President Obama this week however made it clear that trade between India and the U.S. should not be a one-way street. Less than 10 percent of India’s imports of goods are from the U.S., and only 2 percent of U.S. exports of goods are to India. There is still untapped potential for trade between the two countries, he said.

Some of the trade would be in technologies that were adapted by U.S. companies for Indian markets, such as mobile telephony towers that run on solar power, he said.

The president also said the U.S. would reform controls on the export of high technology to India. Some of these controls on dual-use technologies, that can be used for both civilian and military purposes, were imposed by the U.S. on certain government labs and organizations after India exploded a nuclear device.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com

Tags offshoringInfosys Technologiesservicesoutsourcingindian outsourcingBarack ObamaTata Consultancy Services

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John Ribeiro

IDG News Service

2 Comments

Satish Chandra

1

I am India's expert in strategic defence and the father of India's strategic program including the Integrated Guided Missile Development Program. In my blog titled 'Nuclear Supremacy For India Over U.S.' which can be found by a Yahoo search with the title I wrote: The refusal by pieces of filth such as Advani to recognise the United States as India's number one enemy is sustained by thousands of C.I.A.-RAW-inspired headlines in India's media such as "Indian-American becomes Governor of Louisiana" which should instead say "Indian rewarded for conversion to Christianity with governorship: As reward for conversion to Christianity at age 18, as Americans themselves admit and his numerous published essays and articles on his conversion, Indian made Secretary of Louisiana's Health and Hospitals at age 24, President of the University of Louisiana system at age 27, then Assistant Secretary of Health and Human Services in Bush Administration, then member of U.S. Congress and now youngest Governor in U.S. at age 36" (
Bobby Jindal: The Story They Don’t Want You to Read CenLamar: On Life in Louisiana ). Even more important are the thousands of headlines that are missing from India's media, thanks to C.I.A.-RAW, the story they really don't want anyone to know, saying "India's greatest scientist and greatest living Indian publicly tortured in Harvard seminar, systematically and totally starved for up to 3 weeks at a time, made semi-starved and homeless and even blind for years, kept under 24-hour audio and video surveillance as well as surveillance of communications and electrical typewriter and computer use, document creation and photocopying, etc., by satellite for more than past 3 decades, systematically harassed and in poverty and neutralised and robbed of his work at the cost of hundreds of millions of dollars per year, robbed of crores in his money and property in India by C.I.A.-RAW, forced back into exile in the U.S., all with full cooperation and participation of India's RAW and India's C.I.A.-RAW-controlled prime ministers, politicians and media -- to keep India poor, weak and enslaved: The most intelligent, most handsome man on Earth, a living Incarnation, plans nuclear supremacy for India in near future, to destroy India's number one enemy, the United States, with ten thousand nuclear-armed missiles and will machine gun and bulldoze into trenches all traitors who stand in the way." Since then I have said they will be destroyed in the nuclear destruction of New Delhi; see my blog.
My blog above answers all questions. The author's biography can be found in Marquis' Who's Who in the World (2010 and earlier editions). Satish Chandra

Satish Chandra

2

India's njgger-slave, traitor service chiefs who are constantly talking of threats from India's 'neighbors' must be shot on the spot. The United States is EVERYBODY's neighbor. It has already invaded and occupied Afghanistan, a part of traditional India and will expand its occupation to the rest of the subcontinent.
Was Britain India's neighbor? I am India's expert in strategic defence and the father of India's strategic program, including the Integrated Guided Missile Development Program. The U.S. invasion of Afghanistan means the coast-to-coast destruction of the U.S. by India; see my blog titled 'Nuclear Supremacy For India Over U.S.' which can be found by a Yahoo search with the title for steps I have already taken for the nuclear destruction of New Delhi and then the coast-to-coast destruction of the U.S. and extermination of its population.
Russia and other white countries are U.S. allies. These are the enemies to destroy. All other enemies will be taken care of automatically.
Conventional arms are worthless for destroying the United Sates. Nuclear arms to destroy the United States with a FIRST STRIKE -- this is the key -- are cheap and easy to produce with technology India already has. Prepositioning by its special forces a couple of nuclear bombs in Washington and New York and letting the world know we have done so will give India freedom to test thermonuclear weapons designs, ICBMs, etc., as much as it wants, though India already has this freedom but for the njgger-slaves. Alternatively, twenty kiloton bombs can be prepositioned in the largest U.S. cities and then Washington and New York destroyed with the warning that additional U.S. cities will be destroyed if there is any retaliation. The nuclear destruction of New Delhi -- without waiting -- is all that is needed to make India win.
My blog above answers all questions. The author's biography can be found in Marquis' Who's Who in the World (2010 and earlier editions). Satish Chandra

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