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November 06, 2003

US politicians will not legislate against offshoring to India: FEER report

The Far Eastern Economic Review has (rather belatedly) discovered that there is a backlash among US IT workers to jobs getting offshored to India. It provides the usual job loss statistics and quotes all the "usual suspects"--from a representative of the US-based Washington Alliance of Technology Workers and Kiran Karnik of India's Nasscom--in its report on the topic.

The only new aspect in the report comes towards the end and pertains to whether and how the US elections of November 2004 would influence legislation on offshore outsourcing. "It's anyone's guess as to which way the political roulette wheel will spin. We will definitely see more posturing, but the question is: Will we see regulatory action?" Vivek Paul, vice-chairman of Wipro says in the report.

Quoting analysts, the FEER report concludes that India will NOT face strident criticism--and action--even if politicians opposed to offshoring are big winners in the election. "There's no constituency for bashing India," James Steinberg, a foreign-policy analyst in the Brookings Institution think-tank, says in the report. "There are only two countries that get an applause line when they're bashed [in the US]: China and France," Steinberg, who served as No. 2 in the Clinton administration's National Security Council, adds. He points out that it's politically easier in the US to attack Beijing's communist government than the world's largest democracy. On top of that is the fact that American politicians raise a lot of money from Non-Resident Indians in the US.

Click Here to read the full report. (Free registration required).