India's contribution to US economy should not be undermined
Quite contrary to the general impression that India was taking away American jobs through outsourcing, Indian businesses which have invested widely in the US economy in diverse sectors in services and manufacturing have created thousands of jobs in this country in recent years, according to a new study.
India-based companies have also continued to hire locally wherever they have put down roots, said the study by the Confederation of Indian Industry (CII), "Indian Roots, American Soil: A Look at Indian Companies in the US Economy" released on Capitol Hill on Thursday.
The study, based on a survey of 35 CII-India Business Forum member companies, concluded: Since 2005, nearly two-thirds of Indian companies have added jobs to their US operations;
Together, these 35 companies employ more than 60,000 people across 40 states and the District of Columbia;
More than four-fifths of workers at these companies are hired locally; An overwhelming majority of workers who are employed at these companies are American citizens;
India-based companies that have operations in the US have saved 2,585 jobs from being eliminated due to their acquisition of US firms; The value of these acquisitions since 2005 is $5.9 billion;
The companies represent sectors including pharmaceuticals, telecommunications, health care, energy, iron and steel and information technology.
"Indian businesses have invested widely in the US economy in diverse sectors in the fields of services and manufacturing," said Indian ambassador to the US Meera Shankar said at the CII event highlighting the jobs and investments created by Indian companies in the US.
"They have generated and sustained thousands of direct and indirect jobs in the US economy and have contributed to the global competitiveness of US companies," she said.
"This is CII's first major attempt in bringing together Indian companies with operations in the US, as a group, to interact with members of the US Congress," said CII Deputy Director General Kiran Pasricha.
"What we want to do is highlight the range and depth of the US-India business relationship and to dispel some of the misconceptions attached to Indian companies."
"We want the Congress to understand and appreciate the growing contributions of Indian companies to the US economy, and to US society," she said.
Ron Somers, president of the US-India Business Council, while applauding the release of the new report by the Confederation of Indian Industry on Capitol Hill - in the presence of several US lawmakers from both the Senate and the House - said, "It's imperative that this show be also taken on the road to inform people in the heartland of this fact and debunk the outsourcing and off-shoring myth of the flight of US jobs to India."
Somers said this campaign to get the message out "must be an incessant process because what we are learning is that Congress keeps changing and new people keep coming."
"So, we need to keep together, circle the wagons and keep the message focused that a stronger USIndia economic relationship is job creating both in the United States and job creating in India as well. So, this is a message we need to continue to get out at every chance we can."
Somers said, "Number one, the message has to be that now we are living in a global economy and that a knowledge partnership with India is enabling our American companies team with their Indian partners to remain globally competitive."
"To remain globally competitive means job creation," he added. "The story of the contributions that these companies are making to the American economy is something that we need to continue to underscore - double underscore. And, Indian companies are investing heavily in America at a time when America needs that investment badly."
Somers continued, "Number three, we believe that the leadership of India and the people of India want to do more business with the United States of America, but when legislation passes up on Capitol Hill that appears or even smacks of being anti-India, it weakens the hand of the Prime Minister and the leadership of doing more business in the US."
Somers also spoke of how imperative it is "to get the message out to the heartland and to local communities in these areas." "We need to take it on the road. We need to do road-shows, we need to do more of this around the country. There is a hunger for investment coming into the United States from India and there are more and more American companies going to India, but we are not reaching effectively out to the hinterland as we need to."
He said that "there are many, many good human interest stories that need to be told and we need to get it out there so our people understand that India is a partner going forward in the 21st century."
Because otherwise, Somers cautioned, "In the end, what you worry about is that India is viewed as that other billion-dollar person economy that could possible take American jobs overseas." "We have to reverse that story and tip it on its head," he asserted.
"if I were Wipro, or Infosys, I would do my level best to open up virgin facilities in the United States where you can create jobs so that Americans in Arkansas, in Nebraska, in every constituency where important Senators and Congressmen sit, at least can point to the fact that India is a job-creator and not jobtaker,” he said.
He also said the UID introduction will help in stemming leakages and pilferage and eventually help the country's growth to become 'inclusive and democratic'. Another great boost to US economy can be through the Start Up Visa which has been proposed by Senators John Kerry and Richard Lugar who have reintroduced a startup visa bill into Congress.
The bill, which has been modified since it first burst onto the scene last year, is designed to encourage partnerships between U.S. investors and immigrants in a way that benefits the national economy. The Senators hope that the StartUp Visa Act will attract innovation and innovators to the country, creating jobs and propelling the United States back to the top in the realm of technological development.
Will the startup visa bill have the desired effect? Under the proposed bill, a foreign national living abroad will be given a startup visa if he can raise $100,000 from a U.S. investor to start a business. If the immigrant is already in the country on an employer- sponsored H-1B visa, or a recent graduate from a U.S. university in math or science, and has an annual income of at least $60,000 along with $20,000 from a U.S. investor, a startup visa will also be granted. Those with startup visas must created a certain number of jobs and meet certain revenue/financing requirements within two years to maintain startup visa eligibility.
What's interesting about this bill is that the U.S. investor must be a qualified venture capitalist. This means that the citizen must have invested $50,000 every year for the previous three, explains TechCrunch.
This requirement means that those seeking startup visas are tapping into an already existing entrepreneurial market – this does not increase the investment pool. However, a large percentage of technology and engineering firms launched since the 1990's have been founded by at least one immigrant according to The Wall Street Journal.
It's possible that making it easier for those immigrants to remain in the U.S. will impact how American entrepreneurs make their decisions. If their business partners can be physically present, they may be more apt to initiate a startup. Only time will tell just how much of an impact the startup visa will have on U.S. entrepreneurship, but it could very well encourage foreign students and workers to give entrepreneurship a try.
[ BY LAVANYA GARIKINA ]