• From: sbistcbangalore@xxxxxxxx
  • To: sbinews@xxxxxxxxxxxxx
  • Date: Tue, 23 Dec 2003 07:09:26 +0500

US not to ban outsourcing to India 

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NEW DELHI: The government on Monday told the Rajya Sabha that the United States 
has assured it would not approve opposition to business outsourcing to 
countries like India brought in through legislation by New Jersey and some 
other states of the country. 

In the recent past, there has been vociferous opposition in the US to 
outsourcing of work to India. The state of Indiana cancelled a $15-million 
contract to TCS America, the US subsidiary of software major TCS. 

There was also news of the northwestern American state of Washington, home to 
Microsoft, trying to bring Iegislation that prohibits contracts to 

And there has been talk that the loss of jobs in the US due to outsourcing may 
lead to the issue being made into a poll plank in the Presidential electons 
next year. 

Replying to supplementaries during Question Hour on Monday, Commerce and 
Industries Minister Arun Jaitley said both US government and the industry are 
in favour of continuing with outsourcing of jobs, of which India is a major 
beneficiary. (Is the threat to BPO over?) Jaitley said during his talks with US 
trade representative in June, he was told that Washington totally disapproved 
of the legislations to curb business process outsourcing . 

The Minister said India was able to provide cost-effective and quality services 
for business houses that was attracting European countries and US. 

He said the US industry is also fighting the issue and has contended that 
curtailing outsourcing could affect its profitability. 

The Minister said India is campaigning hard to ensure outsourcing jobs are not 
affected and the Indian missions abroad were assisting in these efforts. 

He said it was being felt in some quarters in Europe and US that while 
manufacturing jobs were being cornered by China, the service jobs were being 
taken away by India. 

Despite the backlash in the US, outsourcing of work from the US to India has 
been on the rise. Outsourcing of tax returns to India for processing is set to 
receive a big boost, with the American Institute of Certified Public 
Accountants (AICPA), the apex body governing US-based Certified Public 
Accountants (CPAs), giving a clean chit to this practice, despite growing 
concerns among US professionals and their clients. 

Legal BPO work has also been on the rise. 


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