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Home > Business > PTI > Report

BPO bills not a backlash on Indian IT: Nasscom

June 12, 2003 13:48 IST

The National Association of Software and Service Companies said on Thursday that the spate of bills in the United States against outsourcing of information technology services were politically motivated and was not a "backlash" against Indian firms, but was due to sluggish economic conditions there.

"It is not a backlash. Due to the key elections (in the US) ahead, many of them are politically motivated," Nasscom chairman Som Mittal said in Bangalore.

"The Maryland, Connecticut and Washington bills are unlikely to be introduced," Mittal, who is the president and CEO of Digital Globalsoft, said at the inauguration of the "Nasscom's India ITES-BPO Strategy Summit 2003".

Mittal said previous incidents have shown that restrictions on outsourcing had only depleted the long-term competitiveness of certain industries.

He said the US auto industry became "strong" once it started outsourcing while the steel industry was struggling because of protectionist measures.

"We are not complacent and not worried, but at the same time we should not lose sleep over these issues," Mittal said.

He called on IT firms to respect the sensitiveness of security concerns in countries, which has heightened in the past few years, and to follow the visa rules.

Mittal said Nasscom along with the government was working to resolve issues of concern on visas through bilateral talks with respective countries.

Union IT and communications secretary Rajeeva Ratna Shah said the anti-outsourcing wave should be looked as an economic problem than a political issue.

"The companies are outsourcing due to the stark economic realities and they realise the cost advantage in outsourcing, which otherwise would eliminate their business," Shah said.

Shah said efforts were being made at bilateral level as well as the General Agreement on Trade in Services and World Trade Organisation talks to resolve the issues on service industry related problems.

Criticising the media for raising the "political pitch" on outsourcing, Shah said it would harm the interests of the Indian IT industry.

Karnataka IT secretary Vivek Kulkarni said the media was worried about job losses in America.

"Developed countries have a systematic way of training their people. Unemployment is largely between three and six months and it was not just in IT, but various other sectors also had job layoffs in the US," he said.

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