If Obama is against outsourcing, why were Bangalore techies rooting for him?
By Zafar Anjum
07 Nov 2008
Days before the US polls, there were reports in the Indian media that techies in Bangalore, India’s Silicon Valley, were rooting for Obama.
Apparently, the reason they were supporting this history-making Presidential hopeful did not have anything to do with technology or outsourcing. They supported him for his message of change—change that would eventually make the world a safer, better and more peaceful place.
Good intentions indeed and quite in line with global trends. People have been admiring and supporting Obama’s bid for Presidency from all over the world—from Kenya to Finland to Indonesia.
But I was scratching my head in bewilderment looking at the support of the Indian techies.
Throughout his campaign, Obama had been indicating that he would discourage US companies from outsourcing jobs.
He would stop giving tax breaks to companies that ship jobs overseas, and start giving them to companies that create jobs in the US, he has often said. He reiterated this even in the acceptance speech.
Now, about 60 per cent of outsourcing jobs in India come from the US. So, shouldn’t the techies be worried if Obama won? Why were they supporting him then?
Perhaps in their support, they were being magnanimous, rising above their narrow professional interests. Who does not want less terrorism in the world? Who does not want an end to the wanton (and often unilateral) way of US leadership that brought much damage to the world?
But there could be one more reason: Obama’s ambivalence.
Ambivalent stand on outsourcing
Actually, even though Obama has been forceful about his arguments on outsourcing, he has also said things that make his stand on this matter, at best, ambivalent. He has sometimes uttered words to the effect that outsourcing of American jobs to India and China cannot be reversed.
“Revolutions in communications and technology have sent jobs wherever there’s an Internet connection, that have forced children in Raleigh and Boston to compete for those jobs with children in Bangalore and Beijing,” Obama had said in a speech in Raleigh, North Carolina, US. “We live in a more competitive world, and that is a fact that cannot be reversed.”
So, where does he stand? Is he for outsourcing or against outsourcing? His ambivalent stand has left his messages on outsourcing amenable to different interpretations.
Nasscom president Ganesh Natarajan has noted that there are no specific tax breaks that a company gets in the US for doing work abroad so what exactly does Obama mean about stopping tax breaks to companies that ship jobs overseas?
(Nasscom stands for the National Association of Software and Services Companies, and is a consortium that serves as an interface to the Indian software industry and Indian BPO industry.)
Obama’s ambivalence is not new. On a related matter, Obama supports the nuclear non-proliferation treaty and wants its vociferous implementation. Yet, he wrote to Indian Prime Minister Manmohan Singh that his support was there for the Indo-US nuclear deal.
How do you explain this duality? Does it show that Obama can come down from his high-horse of idealism to kiss the donkey of real-politic?
If he does, then the Indian outsourcing community need not bother much about his anti-outsourcing pronouncements.
Wait and watch
But when Obama repeated his stand on outsourcing in his acceptance speech after sealing his win, it sent jitters in the Indian outsourcing community.
I didn’t find it surprising that immediately after the news of Obama’s win flashed across the world’s TV screens, the Nasscom chief rushed to CNBC-TV18 to assuage the fears of the Indian techies: “We should not worry about any ban on outsourcing; it is just not going to happen. If at all, he might give incentives to job creation in America which we support and I don’t think that is going to add any adverse impact on Indian outsourcing.”
More clarifications followed. At the moment, based on the evidence at hand, most IT leaders in India are discounting Obama’s statements as political hyperbole. Some IT leaders have said that Obama being a sane person would not take decisions that would make US companies less competitive. Nasscom president Som Mittal has reportedly said US companies would find the right balance.
Nasscom interpreted Obama’s message in a different way. “Obama probably meant manufacturing and not software” when he referred to outsourcing, it said.
Others are less optimistic but take a positive stand. For example, human resources director of Infosys, Mohandas Pai, said his company will wait and watch.
That’s very practical. All Indian outsourcing companies can do at the moment is wait and watch.
But my feeling is that Obama being a man of his words (that’s the image he portrays), he might actually move against all kinds of outsourcing, especially against government sector-related projects.
If that happens, it will certainly affect Indian firms that largely depend on projects from the US. But there are also chances that on assuming office, Obama might want to focus first on the more urgent issues: handling the two wars, developing policies on green energy and bringing the world’s financial system back on its feet. By the time these things are taken care of, the next election will be hovering round the corner.
Zafar Anjum is the online editor of MIS Asia portal.
