Our Bureau

Mumbai , April 21

THE `hot political issue' brewing in the United States (US) against outsourcing from India was put in perspective here on Wednesday, when the US Ambassador, Dr David C. Mulford, pointed out that the issue was a "global phenomenon" and not restricted to Indo-US trade. A global phenomenon that even the US is part of.

The US itself had about $57 billion surplus in its service account and this meant that the country was a large exporter of services to the rest of the world. Only about 100 to 1,50,000 jobs were being outsourced to India, while about six million jobs are "insourced" into the US, he said. Outsourcing is a global problem that is tied-up with the global economy. ``The number of jobs being outsourced is very small in the economy which creates and destroys millions of jobs every year,'' he said. Further, he pointed out: ``Governments and American taxpayers will gradually figure out that if they want to pass an outsourcing ban in their communities, then they are going to subsidise jobs and pay higher taxes and there will be fewer jobs in the future."

While one has to be sensitive to the people who lose their jobs, the issue has become "deeply political", he said. "It is not the magnitude of problem that it is made out to be. Programmes are being planned for re-training workers who lose their jobs, he added.

There was no legislation in the US that blocked outsourcing, he said and added that the other initiatives mooted to discourage the same "were going nowhere".

Dr Mulford was on his first official visit to Mumbai after assuming charge and he was participating in a meeting organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) and the American Chamber of Commerce.

Given the history of distrust in US-India relations, he said that the imbalance opened up a "new frontier of opportunity" in economic and military terms. Detailing his list of requirements from the Indian Government, he urged the latter to remove equity limits on foreign direct investment. "Not to please the US," but because it would help bring in funds to help alleviate poverty, he said.

Underlining infrastructure as a top priority in India, he said that additional investment in infrastructure would help unlock potential for the country.

Unless India made infrastructure development including power, roads, water management, telecommunications, harbours and airports a priority, the objective of sustaining eight to ten per cent growth would prove to be unrealistic, he said.

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