Weekly Current Affairs

Notice

Curbs on outsourcing may hit U.S. economy: Nasscom

  • India’s IT industry has warned about the adverse impact that curbs on outsourcing will have on the U.S. economy, which lacks high-skilled workers.
  • The country’s premier trade body, Nasscom, will be taking a delegation to the U.S. in February in an attempt to reach out to the new administration.
  • U.S. President Donald Trump had promised to follow a ‘Buy American, Hire American’ policy in his inaugural speech.
  • The Indian IT industry provided services to American companies, which helped them to be competitive in the global market.
  • In the U.S., the job creation engine is only corporate America. There is no other way that U.S. economy can generate jobs. And therefore, to keep corporate America fighting fit, ensure that it remains globally competitive, ensure continuous increase in productivity, these services are needed.
  • More than 60% of the Indian IT industry’s $108-billion export revenue comes from the U.S.
  • There is huge inter-dependency between the U.S. and the Indian economy.
  • An Indian IT company which tried to hire people in the U.S., had interviewed more than 4,000 people but could hire only about 20. It’s not that they not qualified, but are not qualified with the skills that are needed.
  • According to December 2015 projections by the U.S. Labour Department, employment of computer and information technology occupations will grow 12% from 2014 to 2024 (faster than the average for all other occupations).
  • However, due to shortfalls in college graduates in science, technology, engineering and mathematics (STEM), entering the STEM workforce, there could be 2.4 million unfilled STEM jobs in the U.S. by 2018 — with more than half of these vacancies in computer and IT-related skills.
  • Even in colleges and universities in the U.S., more than 50% of the students are foreigners in STEM courses.
  • The problem is “discriminatory”, referring to provisions implemented by the U.S. to curb immigration of high skilled workers.
  • The restrictions which were imposed in terms of higher cost of visa is applicable only to so called 50-50 companies, which is actually only the Indian companies.
  • Indian companies actually account for little over 15% of H1-B visas issued.
  • Indian IT industry’s investments in the U.S. were to the tune of $2 billion between 2011-13 and in the four-year period between 2011-15, Indian IT industry had paid $20 billion in taxes.
<