India says US protectionism is regressive

September 12, 2010

India's trade minister lashed out at perceived protectionist moves by the US on Saturday, calling them "regressive" and saying they could delay economic recovery.

The statement by Trade Minister Anand Sharma came after the state of Ohio banned outsourcing back-office jobs to places such as India in an effort to boost domestic employment.

It also follows a recent US law raising visa fees for skilled workers, that will India says will hit its flagship outsourcing sector.

"We feel these are regressive measures," Sharma told reporters as he visited India's second-largest software exporter by sales, , in the southern city of Bangalore.

"The leading economy of the world -- the United State of America -- has to have more confidence to engage with the rest of the world," Sharma said in televised remarks.

Ohio state has banned sending abroad government information technology and back-office projects.

India said earlier in the week it would formally raise its concern over Ohio's ban on offshore outsourcing with the United States at a high-level trade meeting in Washington later this month.

New Delhi will also raise the issue of increased fees for skilled worker visas that will boost annual US visa costs for the sector by 200-250 million dollars annually, according to industry estimates.

"Protectionist tendencies are unhealthy and negative, and lessons from the past make it abundantly clear they end up deepening the recession, they do not help in recovery of economies," Sharma said.

"Any mindset, which is isolationist and inward-looking ends up hurting the economies and societies," he said.

The US measures have come as the country seeks to combat unemployment, which is nearing 10 percent.

The row comes ahead of US President Barack Obama's visit to India in November.

(c) 2010 AFP

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jjoensuu
Sep 12, 2010

Rank: 5 / 5 (1)
"...calling them "regressive" and saying they could delay economic recovery"

Yes of course they could delay economic recovery, in India. India needs to start producing something more than just services, like China is doing.

(After all we do not hear China complaining about this)

This makes me think of the two countries of engineers that were both on the bad side during WW2 (Japan & Germany). Although the industries of both of them got destroyed in that war, they both also rebuilt themselves very well after the war. Contrast this with countries that never were bombed but still have very little industry (and 80% of population in poverty).

But perhaps the reasons are in the 'drive'? Chinese work hard from early childhood to be the best they can (maybe one reason why India has not won a single gold medal in the Olympic games yet).
marjon
Sep 12, 2010

Rank: 1 / 5 (3)
John Stossel compared several countries for ease of starting a business. One individual in India had been waiting for 8 years to start a business sewing clothes. The delay was caused by govt regulations approving his electric power allocation.
Have those regulations changed?
ThanderMAX
Sep 12, 2010

Rank: 5 / 5 (3)
One individual in India had been waiting for 8 years to start a business sewing clothes. The delay was caused by govt regulations approving his electric power allocation.
Have those regulations changed?


These two issues are different and disparate. It's like comparing Patent issues(like by Apple to Google) with recession.
marjon
Sep 12, 2010

Rank: 1 / 5 (4)
One individual in India had been waiting for 8 years to start a business sewing clothes. The delay was caused by govt regulations approving his electric power allocation.
Have those regulations changed?


These two issues are different and disparate. It's like comparing Patent issues(like by Apple to Google) with recession.

No, it is all about govt attempts to control markets, socialism.
Skeptic_Heretic
Sep 12, 2010

Rank: 5 / 5 (2)
One individual in India had been waiting for 8 years to start a business sewing clothes. The delay was caused by govt regulations approving his electric power allocation.
Have those regulations changed?


These two issues are different and disparate. It's like comparing Patent issues(like by Apple to Google) with recession.

Marjon doesn't care, he's a sophist in all aspects without relent.
marjon
Sep 12, 2010

Rank: 1 / 5 (2)
India suffered under socialism for quite some time. Now they are attempting to reverse course and the USA, once anti-socialistic, is not supporting free markets.
I support open markets for products and labor.
Let Indians, Filipinos, Chinese and others who speak, read and write English compete for jobs and create businesses in the USA. Why should English illiterates from south of the border have preferences?
""Any mindset, which is isolationist and inward-looking ends up hurting the economies and societies," he said."
The USA once promoted this idea.
Bob_B
Sep 12, 2010

Rank: 5 / 5 (2)
@jjoensuu

Since the USA destroyed those factories - they helped to rebuild those factories and countries after WWII. The Marshall plan helped a lot, but money more.

BUT, the USA did not rebuild their own factories and steel mills and railroads and...they won't allow any new ones to be built "in someone's backyard", so they are sinking in the ability to produce anything but ideas.

India need not worry. Just wait.
Skeptic_Heretic
Sep 12, 2010

Rank: 5 / 5 (1)
India suffered under socialism for quite some time. Now they are attempting to reverse course and the USA, once anti-socialistic, is not supporting free markets.
I support open markets for products and labor.
Let Indians, Filipinos, Chinese and others who speak, read and write English compete for jobs and create businesses in the USA. Why should English illiterates from south of the border have preferences?
""Any mindset, which is isolationist and inward-looking ends up hurting the economies and societies," he said."
The USA once promoted this idea.

They suffered under theocratic caste systems, then under Anglican Christian rule. What timeline are you from?
marjon
Sep 12, 2010

Rank: 1 / 5 (2)
"India became the poster child for post-World War II socialism in the Third World. Steel, mining, machine tools, water, telecommunications, insurance, and electrical plants, among other industries, were effectively nationalized in the mid-1950s as the Indian government seized the commanding heights of the economy.

Other industries were subjected to such onerous regulation that innovation came to a near standstill. "
"The Industries Act of 1951 required all businesses to get a license from the government before they could launch, expand, or change their products.

http://reason.com...ndian-so

Regulations are GOOD for an economy and don't limit private property rights do they SH?
ereneon
Sep 12, 2010

Rank: not rated yet
I support free markets, but I think we should also use government to stop unfair competition. Letting Chinese firms under-price ours because they make no effort to even meet basic quality, environmental, and labor standards is just foolish. I think we should ban any products from being imported that do not meet some reasonable set of basic standards, and everything else is fair game.
marjon
Sep 12, 2010

Rank: 1 / 5 (2)
Letting Chinese firms under-price ours because they make no effort to even meet basic quality, environmental, and labor standards is just foolish.

Recall the tainted pet food from China? It was the American importers that were liable.
The Chinese govt executed a CEO and an independent quality company, NSF, has set up shop in China to test product safety.
The Japanese and others play the ban when they want to protect their rice or apple producers.
Market forces are much more effective and efficient than govt bans.
mgenest001
Sep 12, 2010

Rank: 3.4 / 5 (5)
It's 'protectionist' when the U.S. moves to provide quality employment for its citizens, rather than outsourcing these jobs to India. It's 'protectionist' when Indian Nationals come to the U.S. on work visas and take jobs away from hard working Americans.

However, it's not 'protectionist' when India gives priority treatment to Indian Nationals as opposed to foreigners applying for IT jobs in places like Bangalore.

It's not 'protectionist' when U.S. citizens apply for work visas in India, only to have the associated costs and stipulations for them change at any given moment with the current government in power.

It's not 'protectionist' when reapplying for visas within India, one must often pay the 'on the books' costs, plus the 'under the table' bribes, in order to grease the wheels so corrupt visa officials will do the jobs they are supposed to do 'legitimately' in the first place.

Huh.

It seems India excels at this 'isolationist and inward-looking' mentality par excellence.
fromtvm
Sep 13, 2010

Rank: 5 / 5 (2)
"...calling them "regressive" and saying they could delay economic recovery"

Yes of course they could delay economic recovery, in India. India needs to start producing something more than just services, like China is doing.

(After all we do not hear China complaining about this)

This makes me think of the two countries of engineers that were both on the bad side during WW2 (Japan & Germany). Although the industries of both of them got destroyed in that war, they both also rebuilt themselves very well after the war. Contrast this with countries that never were bombed but still have very little industry (and 80% of population in poverty).

But perhaps the reasons are in the 'drive'? Chinese work hard from early childhood to be the best they can (maybe one reason why India has not won a single gold medal in the Olympic games yet).

----------------------------------------
last olympic , india won a gold medal in shooting :).
CarolinaScotsman
Sep 13, 2010

Rank: 4 / 5 (3)
Why doesn't Trade Minister Anand Sharma call a US company to complain? At least he'll be able to understand the guy who answers the phone.
Skeptic_Heretic
Sep 13, 2010

Rank: 5 / 5 (1)
"India became the poster child for post-World War II socialism in the Third World. Steel, mining, machine tools, water, telecommunications, insurance, and electrical plants, among other industries, were effectively nationalized in the mid-1950s as the Indian government seized the commanding heights of the economy.

Other industries were subjected to such onerous regulation that innovation came to a near standstill. "
"The Industries Act of 1951 required all businesses to get a license from the government before they could launch, expand, or change their products.

Regulations are GOOD for an economy and don't limit private property rights do they SH?

Want to read us the rest of that article and speak to the good and current influx of wealth due to those same measures or do you want to keep quote mining?
marjon
Sep 13, 2010

Rank: 1 / 5 (2)
"India became the poster child for post-World War II socialism in the Third World. Steel, mining, machine tools, water, telecommunications, insurance, and electrical plants, among other industries, were effectively nationalized in the mid-1950s as the Indian government seized the commanding heights of the economy.

Other industries were subjected to such onerous regulation that innovation came to a near standstill. "
"The Industries Act of 1951 required all businesses to get a license from the government before they could launch, expand, or change their products.

Regulations are GOOD for an economy and don't limit private property rights do they SH?

Want to read us the rest of that article and speak to the good and current influx of wealth due to those same measures or do you want to keep quote mining?

Like what?
marjon
Sep 13, 2010

Rank: 1 / 5 (2)
"Attitudes finally began to change in the 1980s, as India’s persistent budget deficits forced austerity measures in the middle of the decade. A foreign exchange crisis in 1991 precipitated major shifts in public policy thinking. "
"For one thing, more than 90 percent of its workforce is in the informal sector, largely untouched by the regulations perpetuated by the federal government in Delhi and the state and regional governments. "
{It is a coincidence this is where innovation occurred, unregulated sector?}
"It will take a continued commitment to open trade to achieve higher growth rates, and it’s still unknown whether India has the political commitment to stay the course."
http://reason.com...ndian-so
marjon
Sep 13, 2010

Rank: 1 / 5 (2)
It seems India excels at this 'isolationist and inward-looking' mentality par excellence.

All countries do.
It would be interesting if a free market country opened its borders to all. All who feel stifled in their home countries could emigrate to this place to work or start a business.
I suspect a significant number of best and brightest would leave weakening their home country's economy.
Would those countries slap on exit visas or try and compete?
blank_black
Sep 20, 2010

Rank: not rated yet
Why doesn't Trade Minister Anand Sharma call a US company to complain? At least he'll be able to understand the guy who answers the phone.


You must realize that it is the accent that creates the problem in this case, and not the language. An average Indian customer will undoubtedly face the same problem when calling a US company. The Indian might even be well educated but again the difference/change in accent WILL create a problem.
Rank 5 /5 (4 votes)
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