Gangs of New Jersey - Part 7
Gangs of New Jersey - Part 7
Date: Tuesday, March 18, 2003 1:34 PM
H-1B and JOB DESTRUCTION NEWSLETTER
www.ZaZona.com
Much to my surprise, this Indian website published my comment:
Indiatimes Id:ZaZona
Tuesday, March 18, 2003 01:16:53 pm
I am requesting that this and all other Indian newspapers stop
spreading the lie that New Jersey Sen. Shirley Turner has agreed to
table her her anti-outsourcing bill (S1349/A2425).
I have read several times that she "is now convinced about the negative
repercussion it would have had on US industry and has decided to put it
on hold."
Here are the facts:
Shirley Turner is totally convinced that outsourcing work to India must
be stopped. She didn't table the bill either. Assembly Chairman Al
Steele tabled the bill after heavy lobbying by the the ITAA and
NASSCOM. A lie-for-hire PR company called "Hills & Knowlton" was hired
by NASSCOM to dupe the NJ Legislature. Steele didn't want to go on
public record as a traitor to the American workers that elected him, so
he tabled the bill.
How do I know? I talked to Shirley Turner, and I recommend that the
IndiaTimes does the same to get the facts straight.
Tuesday, March 18, 2003 01:16:53 pm
>>> Everyone that cares about supporting Sen. Turner's anti-outsourcing
bill should contact Jersey newspapers to inform them what is
transpiring in the state legislature. The NJ legislature should not be
allowed to table this patriotic bill and avoid publicity. If the
assemblypersons want to sell American workers out they should go on the
record and vote. Use this link to contact newspapers:
http://newslink.org/cgi/find.cgi?3=&2=usnj&1=news
>>> Here is an email I received that has additional contact
information:
OK, I've weeded out all the dead links and hung up web pages for all
the online NJ newspapers I can find. Use the list as you see fit.
Thanks again,
Margherite
Courier Post - Cherry Hill
http://www.courierpostonline.com/about/newstip.html
The Record - Hackensack
letterstotheeditor@northjersey.com
Star-Ledger - Newark
raregood@starledger.com
Trenton Times - Trenton
bmalone@njtimes.com
Jersey Journal - Jersey City
jjletters@jjournal.com
Gloucester County Times - Woodbury
egoldberg@sjnewsco.com
Daily Record - Parsippany
http://newsdirectory.com/go/?f=&r=nj&u=www.dailyrecord.com
Atlantic City Press - Pleasantville
newstips@pressofac.com
Trentonian - Trenton
http://newsdirectory.com/go/?f=&r=nj&u=www.trentonian.com
(also editor@trentonian.com)
Courier News - Bridgewater
http://newsdirectory.com/go/?f=&r=nj&u=www.injersey.com/c-n/
(also cnletter@c-n.com)
Home News Tribune - East Brunswick
letters@thnt.com
Asbury Park Press - Neptune
yourviews@app.com
http://economictimes.indiatimes.com/cms.dll/html/uncomp/articleshow?artid=40440015
India Inc. fights to contain the BPO backlash
TIMES NEWS NETWORK[ SUNDAY, MARCH 16, 2003 09:36:47 AM ]
It all started with the now infamous New Jersey Bill. And since then
the bad news never seems to stop. Protests by trade unions in UK
against moving jobs to India have only got stronger. Germany has
decided to stop issuing green cards to IT professionals from July.
And in the US, the cap on H1B visas is set to go down later this year,
even as theres growing resentment against the more flexible L1 visas
that a lot of companies use increasingly. Add to that the third degree
treatment meted out to Polaris chief Arun Jain in Indonesia some months
back, and now the IT professionals from Chennai in Malaysia. In short,
the picture is pretty grim across geographies. So, how is India gearing
up to face a global backlash against large scale outsourcing as well as
the export of skilled workers? While the ministry of external affairs
has not yet really got involved in a big way, except of course in
extreme cases like Polaris and now the Malaysian episode, the IT
industry body Nasscom has picked up the gauntlet. The IndUS
Entrepreneurs (TiE), which evangelises Indian entrepreneurship and
services globally, is also pushing the same agenda, albeit indirectly.
Top bureaucrats in the MEA feel that issues like the New Jersey Bill
and the H1B visa cap, which are characterized as backlash against
growing concerns over joblessness and recession in the US economy, are
internal and sovereign political matters of the countries concerned and
cannot be commented upon. On the other hand, the Indian IT & ITeS
industry, which has set itself an ambitious target of $77 billion in
annual revenues including $57 billion in exports, sees the party ending
unless it wakes up and smells the java, real soon.
Says Nasscom president Kiran Karnik: The ball has already been set
rolling and we are interacting with key decision and policy makers in
the US about the advantages of outsourcing to India that will accrue to
the sagging US economy. Nasscom will share information on how US
industries, especially banks, insurance and other financial
institutions have benefited (in terms of high quality productivity
model coupled with better revenues) due to increased outsourcing of
back office operations to India, over the years. In fact, US banking
and allied sectors are estimated to have saved $6 billion by
outsourcing to India. Nasscom is also working with ITAA, its
counterpart in the US and with US businesses to formulate strategies to
tackle the outsourcing issue. At home, Nasscom is working on the
apathetic government establishment in trying to convince officials in
the MEA and ministries of communications and IT to take up the cudgels
on its behalf since the advantages of outsourcing to India are not just
in terms of lower costs but better quality and productivity as well.
In fact, in a high decibel communications campaign, Nasscom is trying
to strenthen the brand equity of the Indian software and IT services
industry globally by addressing issues in foreign countries like UK and
US. A leading global communications consultancy Hill & Knowlton has
been engaged for this purpose.
While global recession and unemployment are the obvious causes for the
outcry against moving back-office operations and hence jobs to
countries like India, the outsourcing argument cuts both ways.
Indeed, the IT industry has a very strong case which rests on investor
value and profit, especially in the face of global recession. In fact,
new economy companies, both in India and US, have a sense of deja vu in
terms of a big backlash in developed countries in the 1970s through the
1980s when jobs in the manufacturing sector were threatened owing to
facilities moving offshore to cheaper locations like China and Korea.
Of course, our very own steel and textile industries have also faced
barriers in the form of anti-dumping duty or non-tariff barriers, in
the past.
Says Harsh Singh Lohit, MD of TechSpan, which is a Noida and Silicon
Valley based software services company: Anti-overseas outsourcing
lobbies exist in every country, for example in the developed countries
in the 1970-80s. But then, it subsided when transnational corporations
themselves strated controlling the cheaper offshore manufacturing
bases. In services, Indias aggressive success as the preferred
outsourcing and software development destination has propelled this
anti-sentiment into public domain. My guess is that the dust will
settle when Fortune 1000 companies stabilise their bases here.
Adds N Chandrasekaran, VP, TCS: Theres no anti-Indian feeling. The
issues are born out of humane and country specific problems like
unemployment.
Others like Suresh Nichani, president & CEO of the New Jersey-based
Exinom Technologies Inc are more strident in their views about the
obviously business advantages. Water always finds the lowest spot to
rest at. I think IT services will continue to move to lower cost
locations (assuming, of course, that the quality is good), just like
manufacturing has moved to Mexico and South-East Asia. While hurdles
can be created, ultimately the case to generate more value and break
barriers will be the strongest, he says. Agrees Lohit: No amount
of sentiment can defeat the cold economic logic of offshore and there
are as many proponents of it in America as Indian providers, While the
New Jersey Bill is yet to be passed, in any case, very little
outsourcing is (or indeed will be) done by US government agencies. IBM,
Motorola, GE, Amex, Hughes and similar powerful Fortune 1000
corporations of the world are the natural evangelists for moving jobs
to India and we should focus on reinforcing the value proposition with
these powerful customers. Industry associations must echo this
argument, as Nasscom is doing very effectively. Though the NJ
Bill, which would have prevented any outsourcing of the sate government
projects to India, initially stirred up the hornets nest, many feel it
would not impact India significantly. And in any case, the good news is
that Senator Shirley K Turner, who had tabled the Bill, is now
convinced about the negative repercussion it would have had on US
industry and has decided to put it on hold. Apart from politics making
for bad economics, the Indian IT industry has found some very unlikely
opposition in the US. Says Roop Singh, CMO and head of US operations of
SSIs software business: The group of individuals that are driving
and supporting the revised NJ legislation include computer associations
and local vendors who see their staff on the bench rising due to the
rate differential with offshore resources. Agrees Deepak Ghasias,
CEO, India operations i-Flex Solutions: The backlash is an obvious
result of conflict between political compulsions and economic
necessities.
But in recessionary times, economics will probably win, as Karnik
points out: We felt that the Bill was worded contrary to the basic
tenets of free trade. The global economic scenario has led to increased
cost pressure on businesses which are also finding their real value
proposition in customer relationships and delivery of high quality
services. Hence, outsourcing is critical for survival and retaining
competitive edge. And in examining the fine print of the Bill, career
diplomat Amarendra Khatua, minister at the office of
ambassador-at-large for non-resident Indians and people of Indian
origin, feels that the impact will be limited or negligible on the
Indian IT industry as most Indian service companies located in NJ are
either owned by US Indians or legal alien Indians. The Bill, he feels,
basically seeks to exclude companies not owned by US citizens or legal
aliens in participating in the state contracts. Once a contract is
awarded, further outsourcing can be done on the basis of signing
non-disclosure agreements of intellectual property rights as prevalent.
Secondly, the US-citizen or legal alien owned firms outsource to their
subsidiaries or partner firms in India in most cases. And finally,
since the law is not yet passed, it will be difficult to file a
complaint under the unlawful trade practices provisions, says
Khatua who is a NAFTA trade specialist now based in New York.
Legal experts, in fact, feel that since the NJ Bill is on hold, the
India lobby now has some breathing space. Says Priti Suri, partner of
law firm Lexindia based in New York: The US constitution does not grant
powers to the states to enact laws that can have implications on the
countrys foreign policy. Since the US Bill is not passed yet, it is
open to challenge. Indian companies or industry organisations can
contest the proposed bill in the US and at the WTO.
But its not just America. Voices against outsourcing to India have
been raised even in the UK recently. In fact, British Telecoms
retail unit has decided to go ahead with two call centres in India
only after management assurances that none of BTs permanent
employees in UK would be made redundant as a result. Earlier, UKs
largest insurance group Aviva Plc had also announced plans to set up a
call and claims processing centre in India, employing about 1000 people
this year.
But while employment has been a sensitive issue in most of Western
Europe in the last 30 years, the jobless rate remains the lowest in UK.
Says Apurv Bagri, MD of the UK-based Metdist group which and president
of the UK chapter of TiE: UK unemployment remains the lowest within EU
and whilst there is clearly concern at the loss of any jobs, there is a
general recognition that outsourcing is an unstoppable trend. With
their more conservative outlook, many UK companies have in any case
been slower to adopt an aggessive outsourcing model than their US
counterparts. There remains thus considerable potential for India to
develop our outsourcing potential though, given todays economic
circumstances, this needs to be handled carefully to prevent a
backlash. Indian workers are well respected and this position has not
changed.
Agrees Tony Khindria, UK and France-based lawyer and founding partner,
Lexindia: The UK is one of the most successful countries to tackle the
issue of unemployment generally. In contrast to this, France, which has
much more rigid labour laws and strong unions has been unable to reduce
unemployment significantly. Previously in UK, immigration laws were
eased, for example, to give priority to foreign software engineers.
These relaxations are now more limited. But the UK continues to
encourage Indian companies to invest and in some cases bring in their
own employees.
Obviously, the economic downturn also emphasises concerns relating to
unemployment caused by immigration of foreign workers as is evident
from the recent outcry in the US media against L1 work permits. While
Nasscom and Indian IT companies dont see any immediate threat like a
dramatic change in the L1 visa programme, the reduction of the H1B
quota from later this year is likely to impact IT related business
travel.
But whether its outsourcing or insourcing, ground realities of
globalisation cannot be ignored. Its probably time that the US
workers and their counterparts in Europe grew up and faced cold
economic facts.
With K Yatish Rajawat in Mumbai
Help to Keep ZaZona.com Online
Donate to the Cause at
http://www.zazona.com/Donations.htm
To Subscribe or Unsubcribe send an email to
Back to archives