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By Prakash Chawla
As electioneering picks up in the US in the coming weeks and months, Swadeshi will be a key feature of campaigning both for President George W. Bush and his Democrat challenger John Kerry. A series of bills at the state and federal levels banning outsourcing of work to overseas companies and high-pitched television debates by Republicans and Democrats would be the key feature of the American Swadeshi movement.
Kerry took a lead in raising an outcry against the ?export of jobs?. It has become his pet theme.?All across America people are feeling the pinch of outsourcing, as jobs are going to India, to China, and they?re not creating the jobs to replace them.
?George Bush has the worst jobs record of any President since Herbert Howover,? the White House aspirant said in one of his meetings. The Bush camp does not want to be seen wanting in defending American jobs. US Trade Representative Robert Zoellick who visited India on February 16, made no bones about the fact that political considerations must weigh in whatever stand the Bush Administration would take on outsourcing.? You have your political sensitivities and we have our political sensitivities,? Zoellick said.
Zoellick who met his counterpart Arun Jaitley and National Security Adviser Brajesh Mishra, was told in clear terms that the US, hailed as the ?champion? of the free market was turning protectionist. Deputy Prime Minister L.K. Advani and External Affairs Minister Yashwant Sinha raised similar concerns.? All these years, they were asking us to hug liberalisation. It is our turn to teach the US lessons on globalisation,? said Sinha.
If the US Administration does not agree with India'scontention of being inward looking, they should believe their own commentators watching the US Spending Bill for fiscal 2004. This bill has a provision barring companies receiving federal contracts from doing all or some of work overseas.
?The anti-outsourcing clause sends a signal to the rest of the world that is okay to become protectionist,? President of the Information Technology Association of America Harris Miller was quoted in the Washington Post.
The US shutting its doors is not restricted to information technology. It earlier lost a case in the WTO Appellate Body against the European Communities and Japan for its violation of Safeguard Agreement and GATT 1994 for slapping higher tariff on steel products.
While it fought a bitter war against Europe to protect its steel industry,the US went and joined hands and struck a deal with the EU in maintaining high level subsidies on their agriculture. In fact, it was the EU-US deal on farm subsidies which led to revolt amongst the developing countries at Cancun.
The institution of WTO, meant to be ensuring a free global market, is being used by Americans for protecting their own interests. Since the Geneva-based multi-lateral referee is yet to reach any agreement on government procurement,the US is taking a ?lawful?protection under this alibi.? We are not violating any multilateral law,? Zoellick said in the context of laws on banning outsourcing. Well, that is a legal aspect of the debate. How about the spirit of globalisation, lectured by the US upon the rest of the world? The movement against shipping of jobs overseas is confined, for the moment, to the government work. But then, if the pressure continues, the American multinationals would feel the heat. It is not going to help them either since, according to Nasscom (National Association of Software and Service Companies), the US firms saved over 10 billion dollars by getting the work outsourced to India in 2003-04 alone. Come to think of it, India has not emerged as such a big player in outsourcing that the US should feel concerned about it. The trend is not going to change either in the near future.Observations by Secretary General of the UNCTAD Rubens Ricupero, should be an eye-opener for the Americans.
?The global outsourcing spend was 320 billion dollars last year and in 2005 it is expected to be 585 billion dollars and 827 billion dollars in 2008. India'sshare in total IT spend will be three per cent. ?Offshoring is a rapidly growing segment of outsourcing and despite much excitement about its significance to North-South trade, the share even of frontline countries like India in this business is small and fears of a big wave of offshoring to poor countries swallowing up rich country high skill jobs appear misplaced,? Ricupero said.
