Saturday, April 2, 2016

India Files H1B Visa Complaint Against US to WTO Amid Falling Exports

India has recently complained to the World Trade Organization against the United States over changes to visas for skilled workers that Republican presidential candidates have targeted for elimination, according to a report in the UK's Financial Times.

The WTO revealed that India had requested consultations with the US over moves by Washington to raise fees for L1 and H1B working visas and also restrictions on the number of those visas awarded. The move is the first step in initiating a dispute at the WTO.

India's WTO complaint:

India's WTO complaint is over an increase in fees on H1B visas that the US imposed on companies with workforces comprised of more than 50 percent foreign workers. A provision included in last year's federal spending bill added a new $4,000 fee for each H1B, which India argues is discriminatory to the country under its trade agreement with the US.

Meanwhile, the annual gold rush in Silicon Valley to file applications for H1B visas has just begun, as the federal government began distributing some of the 85,000 H1B visas it is authorized to issue this fiscal  year, according to Vice News.

Indian Body Shops Infosys, TCS and Wipro Topped H1B Sponsor List in 2013


Why the Complaint?

Why is India complaining? There are two main reasons:

1. India's overall exports have suffered 18th consecutive monthly decline in February 2016, according to India's Economic Times. Exports from India amounted to US$264 billion in 2015,  down -12.4% since 2011 and down -16.9% from 2014 to 2015.

2. Most of India's IT exports to the United States are made up of wages of H1B workers brought to the United States by a handful of Indian body shops like Tata Consulting Services (TCS) and Infosys.  In 2014, 86% of the H1B visas for tech workers were granted to Indians, according to available data. Given India's heavy reliance on H1B workers for its IT exports earnings, it is natural that the Indian government gets very concerned whenever there's even a hint of the US possibly limiting H1B visas or making them more expensive.

Excluding the Indian H1B workers' pay,  such exports drop to about one-twentieth of the the amount reported by the Indian government as IT exports, according to a 2005 study by US General Accounting Office (GAO).

Indian Body Shops:

The Indian body shops like Cognizant, TCS and Infosys that rely on the H1B visa program in the US are "the shining star" of the Indian economy, and the country's largest export, according to an Indian-American professor Ron Hira who is a strong critic of the abuses of H1B program. By complaining, the Indian government and firms that rely on the program are trying to "build up a firewall so that no other reforms can come through and constrain the program in any way."

Indian Code Coolies:

H1B workers brought in by Indian body shops are described variously as "code coolies" or "H1B slaves". Some call them "indentured servants", like the ones from India who replaced slave labor after the British empire abolished slavery.

“’Indentured servants’ is a pretty accurate term because in many cases that’s exactly what’s going on,” said Phillip Griego of San Jose’s Phillip J. Griego and Associates. Over the years, Griego and his law partner, Robert Nuddleman have represented several H-1B workers in lawsuits against body shops.

Summary:

India has complained to the World Trade Organization about changes to the US H1B that mainly benefit India's body shops like Cognizant, Infosys and Tata at the expense of both US and Indian workers. US workers lose their jobs while Indian workers are exploited as wage slaves. India uses the wages of Indian H1B workers to inflate its IT export earning by as much as 20X. Proposed changes  to H1B visa program like higher fees and lower numbers threaten India's export earning which have declined for 18 months in a row.  The ongoing election debate over whether the H1B program is hurting American workers rose to public consciousness amid the Republican primary debates this year. The election outcome has the potential to negatively impact Indian H1B exports earnings.


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51 comments:

Syed Qasim Abbas said...

could we stick to what Pakistan is doing well instead of India's shortcomings life goes on with or without India

Riaz Haq said...

SQA: " could we stick to what Pakistan is doing well instead of India's shortcomings life goes on with or without India"

Please read the description of the subjects I blog about here:

The subjects include personal activities, education, South Asia and South Asian community activities, regional and international affairs and US politics to financial markets and beyond.

Riaz Haq said...

Annual race for 85,000 tech #H1B visas is under way. #India body shops in front. http://on.wsj.com/1M5H6mF via @WSJ


Many H-1Bs are issued to offshore outsourcing companies, especially from India, which have U.S. subsidiaries that bring in foreign labor they subcontract to American banks, retailers and others. Critics say those foreigners displace U.S. workers because they are often paid lower wages.

As the presidential race has thrust immigration and job displacement center stage, demand for foreign skilled-worker visas coveted by tech companies is expected to far outstrip supply again this year, likely prompting the government to hold a lottery.

U.S. Citizenship and Immigration Services, the federal agency that oversees the H-1B visa program, begins accepting applications Friday for fiscal 2017.

“April 1 isn’t so much as a start date, but a starting gun for the furious race by U.S. employers to secure skilled labor,” said Adams Nager, economic policy analyst at the Information Technology and Innovation Foundation, a tech policy think tank.

U.S. companies can sponsor 65,000 foreigners with at least a bachelor’s degree from any university. An additional 20,000 visas go to individuals with advanced degrees from U.S. institutions. Universities and nonprofits, which aren’t subject to a cap, also use H-1Bs to hire many workers each year.

The 85,000-quota is expected to be exhausted in a matter of days for the third consecutive year despite announcements by some tech companies of layoffs, according to federal officials and immigration attorneys who file petitions for companies.

Employers pay fees to the government and lawyers to apply for the visas.

“I marvel at the fact that employers are willing to pay thousands of dollars just to get a chance to be subjected to a random lottery,” said Los Angeles-based Rita Sostrin, among many attorneys who said their H-1B business has grown significantly this year.

Ms. Sostrin predicted that individuals competing for a visa in the regular “skilled” category, for people with a bachelor’s degree, will have less than a 20% chance of being selected in a lottery. Those with advanced degrees will have less than a 50% chance, she said.

“The tech industry is not slowing down here that I have seen,” said Gregory McCall, an immigration attorney in Seattle. Based on his caseload, “there are plenty of companies going like gangbusters.”

Arguing that it faces a shortage of specialized workers, the U.S. tech industry has for years lobbied to expand the H-1B program—and counted on support from the business-friendly Republican establishment. The 2016 presidential race has altered the picture.

On the campaign trail, the program has been blamed by some candidates for enabling employers to hire cheaper foreign labor at the expense of U.S. workers.

At rallies, GOP front-runner Donald Trump has featured tech workers who said they were replaced by foreigners. At a recent debate, Mr. Trump briefly disavowed his opposition to the visa program, saying such foreign workers were needed. But a short time later he switched back to opposing the program.

Republican rival Ted Cruz, who supported the program’s expansion in 2013, has called for a moratorium until it is reviewed. Democratic contender Bernie Sanders also is a critic; Hillary Clinton is a supporter.

“This is the first time the H-1B program has entered a presidential campaign. As a result, it’s received more scrutiny than it has in the past,” said Ron Hira, a Howard University professor who studies the program.

Mr. Hira, a critic of the program, said the Obama administration has failed to protect U.S. workers’ interests. “The not so subtle message to American workers is ‘tough luck’—you should be replaced by a cheaper H-1B guest worker.”

Many H-1Bs are issued to offshore outsourcing companies, especially from India, which have U.S. subsidiaries that bring in foreign labor they subcontract to American banks, retailers and others. Critics say those foreigners displace U.S. workers because they are often paid lower wages.

Riaz Haq said...

China tops the list of world's 10 largest industrial producers. It is followed by the US, Japan, Germany and South Korea, according to United Nations Industrial Organization (UNIDO).

India ranks 6th in the world in terms of total manufacturing output in 2013, up from 9th place in 2008,

http://economictimes.indiatimes.com/news/economy/indicators/india-jumps-to-sixth-place-in-top-10-manufacturers-list-report/articleshow/51663535.cms

India's manufacturing value added (MVA) per capita of 161.7 in 2013 is among the lowest in the world. It's up from 131.9 in 2008.

In fact India's 2008 MVA per capita of 131.9 was lower than Pakistan's 141.1. Since 2008, Pakistan's MVA per capita has slipped to 139.1 in 2013 while India's has increased to 161.7 in this period.

Bangladesh's MVA per capita has jumped from 82.2 in 2008 to 118.3 in 2013.

On UNIDO’s industrial competitiveness index, most industrialized countries lost ground in the last three years. Among the five most competitive are four high-income countries (Germany, Japan, the Republic of Korea and the United States), along with China ranking fifth. The four are among the world’s most industrialized countries and, with China, account for 59 percent of world MVA.

https://www.unido.org/fileadmin/user_media_upgrade/Resources/Publications/EBOOK_IDR2016_FULLREPORT.pdf

Anonymous said...

Since 2008, Pakistan's MVA per capita has slipped to 139.1 in 2013

You think this is due to FTA with China and wiping out of pretty much all of Pakistan's non defence related light and heavy industry as a result ?

James said...

Why isn't the Indian or PR machine active in this case?

Sunil said...

The primary cause of decline of India's exports is Petroleum products and it is for the same reason why India's imports has also declined, that is, the falling price of Oil.

As a result there is no big impact on Forex reserves.

The good thing is that India's exports of value added exports has increased, be it in Pharmaceuticals or Cars.

Riaz Haq said...

James: "Why isn't the Indian or PR machine active in this case?"

What makes you think it's not? Hillary Clinton supports the expansion of H1B program as do many in US Congress who get fat donations from the high-tech lobby...the same groups that helped it grow last year when Google's Eric Schmitt said:

The executive chairman at Google urged Congress on Wednesday to increase the number of high-skilled work visas made available to foreigners and to deal with other immigration issues later on.

Eric Schmidt spoke Wednesday at the American Enterprise Institute, a conservative think tank. Schmidt said he believes the United States is better off having more immigrants, not fewer, but he particularly is focused on allowing more immigrants into the U.S. with specialized technical skills.

http://www.mercurynews.com/business/ci_27739294/googles-eric-schmidt-says-h-1b-visa-changes

Riaz Haq said...

Sunil: "You think this is due to FTA with China and wiping out of pretty much all of Pakistan's non defence related light and heavy industry as a result ?"

No, it's because of energy crisis that many industrial units, Twariqi steel mill and fertilizer plants among them, have been forced to shut down.

http://www.bloomberg.com/news/articles/2015-12-02/posco-venture-said-to-seek-buyer-for-idled-pakistan-steel-mill

Hopefully, the LNG deal with Qatar and lifting of Iran sanctions will help alleviate this crisis.


http://www.riazhaq.com/2016/02/can-pakistan-use-qatar-lng-price.html

Anonymous said...

Hopefully, the LNG deal with Qatar and lifting of Iran sanctions will help alleviate this crisis.

Unlikely LNG is normally 2 times more costly than piped gas in the international market.Why do you think the EU has not been able to break Russia's stranglehold?

Also Iran is India's strategic partner.It has the world's largest gas reserves but because it can't build pipelines to Europe(Because of Turkey's informal understanding with GCC) and can't compete Geographically with Russia for supplying gas to China(Siberia being contiguous and practically next door) it basically has only India as a large enough market (200 Bcm/year requirement by 2020) where it can build undersea pipelines.

http://www.ibtimes.co.in/india-iran-close-strike-4-5b-undersea-gas-pipeline-deal-671072


Its oil wells are all in later stages and output will stabilize around 5 million bpd out of which 2-3 million will be required domestically.

Without disclosing too much,I would just say its long term strategic interests allign with India and unless Pakistan somehow improves its relations with India it is being encircled.

https://www.youtube.com/watch?v=2URWBlxc1zQ

(This is Iran's official PressTV btw)

I would say Pakistan has maybe a 5 year window to get its act together.

Riaz Haq said...

Anon: "Unlikely LNG is normally 2 times more costly than piped gas in the international market."

Not any more. Global LNG glut is much worse than the oil glut with more and more supply coming online and demand not increasing much.

Russia needs Western Europe more than Western Europe needs Russia as far as energy is concerned.

In this environment that favors buyers, Pakistan has struck a good bargain with Qatar.

Riaz Haq said...

Anon: "(This is Iran's official PressTV btw)"

PressTV has very low credibility.

Calling Iranian Navy indigenous and powerful is ludicrous. It's badly depleted after years of sanctions. And it's unlikely that Iran can rebuild quickly given the low hydrocarbon prices.

Riaz Haq said...

#India can’t find buyers for its offshore rupee "masala" bonds. #Modi #BJP http://on.wsj.com/1Tswobt via @WSJ

India’s attempt to diversify and deepen its corporate debt market has fallen flat, thanks to lack of demand and bad timing.

Last fall, Prime Minister Narendra Modi indicated to a gathering of 60,000 people at London’s Wembley Stadium that after James Bond, and Brooke Bond tea, a new type of bond was coming to markets: bond, rupee bond.

Looking for ways to help Indian companies take on more debt, invest and create jobs, the government last year allowed them to issue rupee-denominated bonds overseas.

Asia’s third-largest economy is looking to mimic China’s success with its yuan-denominated, “dim-sum” bonds which have raised more than $100 billion for Chinese and other companies since they were launched in 2007, according to data from Dealogic.

However, despite Mr. Modi’s high-profile quips, plans to issue more than $1.5 billion from so-called masala bonds have yet to raise a rupee.

-----


The holdups are hampering India’s efforts to spread the use of the rupee as an international currency, diversify its source of funds and reduce its dollar liabilities.

The outlook for masala bonds “is not very optimistic,” says Lin-Jing Leong, an investment manager at Aberdeen Asset Management Plc, which manages $4 billion in Asian debt.

Unrestricted by Indian regulations, global financial institutions like International Finance Corp., Inter-American Development Bank and European Bank for Reconstruction and Development, have issued rupee bonds outside India for more than a decade. Around $3.8 billion worth of rupee bonds are outstanding offshore, versus $64 billion worth of yuan-denominated bonds, according to Dealogic.

Masala bonds are an attractive source of funds for Indian companies as investors bear the foreign-exchange risk. Many Indian companies are struggling as the amount of rupees they have to pay to service their dollar and euro debt has ballooned as the South Asian currency has depreciated over the past year.

The masala-bond market was opened to companies late last year just as global interest in emerging markets was on the decline. The rupee has been volatile since then, adding to investors’ concerns about the downside of an investment in the currency.

Indian companies are also reluctant to pay the higher yield that investors want to compensate for the risk.

“Liquidity is going to be quite bad offshore; I would obviously require some premium with regard to yields,” said Ms. Leong of Aberdeen.

“The pricing we are getting [in masala bonds] would be a little higher than the cost at which we could raise money in the domestic market,” said Keki Mistry, chief executive officer at HDFC.


Anonymous said...

Russia needs Western Europe more than Western Europe needs Russia as far as energy is concerned.

Don't read the US press look at the deliveries. Has there been a substantial increase of LNG supply to Europe?Has there been any new LNG terminals brought online outside Spain(Which is not well connected to the rest of the EU gas grid).

Why do you think the EU is dragging its feet on more sanctions on Russia?

Anyway I suggest Pakistan gets its act together in the next 5 years or else its all over.

I am not hopeful but miracles have happened in other places.Lets see what happens.

Riaz Haq said...

Anon: "Don't read the US press look at the deliveries. Has there been a substantial increase of LNG supply to Europe?Has there been any new LNG terminals brought online outside Spain(Which is not well connected to the rest of the EU gas grid)."


What do you think Russia is going to do with its gas? Ship it elsewhere?

Russia is heavily dependent on gas revenues. Its economy is shrinking. It's in deep trouble.


http://www.usnews.com/news/business/articles/2016-04-01/russian-economy-shrinks-37-percent-in-2015

Samant said...

Yeah slaves, those slaves are going around US and are having a good time :) slaves are also buying thier own houses there. Lolz

Riaz Haq said...

Samant: "Yeah slaves, those slaves are going around US and are having a good time :) slaves are also buying thier own houses there. Lolz"


Own houses? Indentured servants don't own houses

Consulting firms recruit and then subcontract out skilled foreigners to major tech firms throughout the country and many in Silicon Valley.

Those who work for these third party firms that skirt the law often call them “body shops” and sometimes they get caught.

For example in August, 2014, a Cupertino man involved with one body shop pleaded guilty and was sentenced in US District Court to 19 felony counts of visa fraud where he admitted he knowingly applied for work visas for foreigners who had no job offers, filling out applications for fake jobs for a Silicon Valley tech firm.

However, some local workers say many don’t get caught. And the workers are the ones who suffer.

“It virtually makes these employees a slave,” said one worker who came from India more than a decade ago.

“The body shops have a specific business model,” the worker said. “They make business and profit by having cheap labor.”

Because the man fears for his safety and his future, he asked that he remain anonymous. He had worked for 7 to 8 different body shops before he spoke to us.

“There are times when I am trapped there are times when I am, yes, I feel I am trapped,” he said.


Read this : http://www.nbcbayarea.com/investigations/Silicon-Valleys-Body-Shop-Secret-280567322.html

Riaz Haq said...

From United Nations Industrial Development Organization (UNIDO):

Pakistan Manufacturing Value Added (MVA):

MVA per capita at constant 2005 prices increased from US$135.03 in 2005 to $143.84 in 2014

MVA as percentage of GDP at constant 2005 prices in US$ decreased from 18.05% in 2005 to 17.41% in 2014

http://www.unido.org/Data1/IndStatBrief/A_Industrial_Performance_MVA_GDP.cfm?Country=PAK

India Manufacturing Value Added (MVA):

MVA per capita at constant 2005 prices increased from US$155.73 in 2005 to $168.42 in 2014

MVA as percentage of GDP at constant 2005 prices in US$ decreased from 15.10% in 2005 to 13.85% in 2014


http://www.unido.org/Data1/IndStatBrief/A_Industrial_Performance_MVA_GDP.cfm?Country=IND

Samir said...

http://data.worldbank.org/indicator/NE.EXP.GNFS.CD

The data above is from WORLD BANK showing exports of GOODS & SERVICES. From 2011 to 2014 is in billion USD is as follows:-

Pakistan: 29.8, 27.8, 30.7, 29.9
India: 445, 447, 468, 475

That is the latest from the World Bank. Although India's service exports went up in 2015, goods exports went down due to slowdown in EU.

Do you agree?

Riaz Haq said...

Samir: "The data above is from WORLD BANK showing exports of GOODS & SERVICES. "


India's IT services exports are highly inflated and misleading.

A 2005 study by US General Accounting Office (GAO) found that Indian government's figures for software and technology exports to the United States were 20 times higher than the US figures for import of the same from India.

U.S. General Accounting Office looked at the 2003 data showing the United States reported $420 million in unaffiliated imports of BPT (business, professional, and technical) services from India, while India reported approximately $8.7 billion in exports of affiliated and unaffiliated BPT services to the United States.

In theory, India follows what is known as BPM 6 (MSITS) reporting method for software and information-enabled technology services (ITES) which counts sales to all multinationals, earning of overseas offices, salaries of non-immigrant overseas workers as India's exports. In practice, India violates it. BPM 6 allows the salaries of first year of migrant workers to be included in a country's service exports. India continuously and cumulatively adds all the earnings of its migrants to US in its software exports. If 50,000 Indians migrate on H1B visas each year, and they each earn $50,000 a year, that's a $2.5 billion addition to their exports each year. Cumulatively over 10 years, this would be $25 billion in exports year after year and growing.

http://www.riazhaq.com/2013/11/indias-it-exports-figures-highly.html

Samir said...

Riaz Sir,

'In theory, India follows what is known as BPM 6 (MSITS) reporting method for software and information-enabled technology services (ITES) which counts sales to all multinationals, earning of overseas offices, salaries of non-immigrant overseas workers as India's exports. In practice, India violates it."

That still is puzzling. First from an accounting perspective a WIPRO or a TCS has to pay corporate tax on that income. Secondly, how does India manage to grow it's ForeX reserves year after year - now at $360 billion

Riaz Haq said...

Samir: " how does India manage to grow it's ForeX reserves year after year - now at $360 billion"


Let's talk about the US part of it.

The Indian H1B visa holders make up over 80% of the visa issued each year.

These workers renew their visas each year and live and work in US for many many years after arriving in this country.


US Center for immigration studies estimated there were 650,000 H1B workers in the US in 2009, a number that is sure to have exceeded a million H1B visa holders in America by now.


The BPM 6 (MSITS) reporting method allows for inclusion of their pay only in the first year as H1B worker in this country, not for subsequent years. India violates this rule and continues to add up their salaries into its export earnings for many many years after they arrive.

So, lets say there are conservatively 600,000 Indian H1B workers in the US each being paid conservatively $80,000 a year. This adds up to $48 billion from US alone. This amount should be counted as part of remittances from overseas workers, not as IT exports for the year.

r_sundar said...

Why is India complaining this with WTO? US H1 B visa fees are local US laws.

Riaz Haq said...

sundar: "Why is India complaining this with WTO? US H1 B visa fees are local US laws."

Read my post carefully.

Any efforts to make H1B visa difficult or expensive has a direct impact on Indian body shops like Infosys and Tata. It could cut directly into the cumulative H1B worker wages that India counts as its IT exports.

r_sundar said...

That's not my point, if you read carefully. India has no legal standing to complain in WTO. Visa fees decision is US.

r_sundar said...

WTO is the front channel, which is not of any use. The lobbyist will take care of this, once Hillary is in power.
These sarcastic coolie remark are partly true, but only for a short time. All work crazy hard, many soon employ Americans with their own startups. No wonder Indians are looked up to here.(with very little racial bias).
Pakistanis get a free pass for looking same.

Riaz Haq said...

r_sundar: " No wonder Indians are looked up to here.(with very little racial bias)."

Xenophobes in America do not differentiate among people of color in their hatred toward foreign-looking persons.

http://www.huffingtonpost.com/2013/06/05/hate-crimes-sikhs-hindus-arabs-fbi_n_3392760.html

The current debate against H1B is aimed mainly at Indians, particularly the Indian body shops like InfoSys and Tata, who are the biggest abusers of the program. There are several lawsuits pending in courts to address it along with the growing political opposition to it in US Congress.

r_sundar said...

Only losers will fall for the Xenophobes, always playing the victim card.
Have the guts to post my postings - else accept defeat.

Riaz Haq said...

sundar: "Only losers will fall for the Xenophobes, always playing the victim card."

That is to not unexpected from someone of Indian origin given the fact that INDIA IS THE WORLD'S MOST RACIST COUNTRY, according to a World Values Survey.

http://www.riazhaq.com/2013/05/world-values-survey-finds-indians-most.html

India is a country where caste-based Apartheid is widely practiced with 250 million of its Dalit citizens as the world's most unfortunate victims.

http://www.riazhaq.com/2009/11/dalit-victims-of-apartheid-in-india.html

FireSnap said...

Well you call them "Indian Coolies" but do you know the situation of many Pakistanis in GCC. According to the International Organisation of Labour, Pakistan is the second among South Asian nations sending migrant workers abroad. Nearly 7 million Pakistanis have left the country in recent years for the purpose of finding a job and 96 per cent of them make their way to the GCC countries, closely followed by Saudi Arabia.
Once in Saudi Arabia or Dubai or Abu Dhabi, theirs is a grim reality. The kifalah system of sponsorship that gets them there insures that they are already deeply in debt before they ever start working.

As has been reported in a recent front page story in the New York Times, the Pakistani workers usually do menial jobs in construction, garbage disposal, cleaning, ground crews and such. They live in labour camps in deplorable conditions, sometimes 10 or 15 in a single room, with any clothes they may wear and any food they may eat crammed in between the bunks.

Often, employers refuse to pay them, or pay them months after they are due. The recruiters to whom they owe money take anything they get, before any money can be sent home. If they complain too much, there is always the prospect of arrest. They receive no legal advice, no lawyers and no leniency. Punishments are the only certainty.

What is the Pakistan Government doing about that?

Riaz Haq said...

FireSnap: "What is the Pakistan Government doing about that? "

There are a lot more Indians suffering worse treatment than Pakistanis in GCC nations.

What is Indian govt doing about that?

What can it? It depends on them for vast amounts of foreign exchange. The country sending the largest remittances to India is UAE ($13.2billion) followed by US and Saudi Arabia ($11 billion each) and Pakistan ($4.9 billion).

http://www.riazhaq.com/2016/02/pakistanis-sent-5-billion-to-relatives.html

Riaz Haq said...

#India's population explosion will make or break its economy. Not enough jobs and huge skills gap #BJP http://cnnmon.ie/1V1p0FL via @CNNMoney

unless India makes big improvements in how it educates and trains students, this demographic boom could instead saddle the country with another generation of unskilled workers destined to languish in low-paying jobs.
The need to train workers up -- and quickly -- is paramount. Currently only 2% of India's workers have received formal skills training, according to Ernst & Young. That compares with 68% in the U.K., 75% in Germany and 96% in South Korea.
It's a problem spread across industries. The Royal Institution of Chartered Surveyors estimates that in 2010, India needed nearly 4 million civil engineers, but only 509,000 professionals had the right skills for the jobs. By 2020, India will have only 778,000 civil engineers for 4.6 million slots.
There is a similar gap among architects. India will have only 17% of the 427,000 professionals it needs in 2020.

The problem? The RICS found that India's education and professional development system has not kept pace with economic growth and is in "dire need for reform."
In industry after industry, the same story is repeated. A recent survey by Aspiring Minds, which tracks workforce preparedness, found that more than 80% of India's engineering graduates in 2015 were "unemployable."
"The quality of training offered in most colleges is not at par with the high demands generated by tech industries," said Preet Rustagi, a labor economist at the Institute for Human Development. "There is no regulatory body that keep checks on the quality of education."

Critics say India's universities are too focused on rote memorization, leaving students without the critical thinking skills required to solve problems. Teachers are paid low salaries, leading to poor quality of instruction. When students are denied entry to prestigious state schools, they often turn to less rigorous private colleges.
"When IT industries boomed in India a few years ago, many below-the-mark private colleges emerged to cater to their needs," said Alakh N. Sharma, director at the Institute for Human Development.

Prime Minister Narendra Modi is racing to provide workers with training. His government is recruiting skills instructors, and turning old schools into learning centers. Programs strewn across various government agencies are being consolidated. Companies in the private sector are pitching in to help provide training.
The most pressing need, however, might be in primary education. Pupils in India are expected to perform two-digit subtraction by the age of seven, but only 50% are able to correctly count up to 100. Only 30% of the same students are able to read a text designed for five-year-olds, according to education foundation Pathram.
If the country's unique demographics are to pay dividends, improvement is a lesson to be learned quickly.

Man of Action said...

"#India's population explosion will make or break its economy."
As far as I know, India's population growth rate is lesser than Pakistan.
Moreover, through United Nations Fertility Variant, it will start declining after 2060.

For skill development, I know that manpower is emerging faster than jobs. And that's why Govt. has launched standup India program a few days ago to create industrialists.

Case of catching up with quality, Indian Institutions are catching up and will achieve with time (I'm myself connected to this sector).
Can you tell where does Pakistan stand here. Your country's literacy must be greater concern for you.

Riaz Haq said...

MoA: "Case of catching up with quality, Indian Institutions are catching up and will achieve with time (I'm myself connected to this sector).
Can you tell where does Pakistan stand here. Your country's literacy must be greater concern for you. "

First, let me respond to your concern for Pakistan. Yes, the literacy rate is a concern of mine too. It needs to rise faster than it is.

But your assertion about India "catching up with quality" does not appear to be supported by evidence.

Since you like to compare India with more developed countries, here's what you need to pay attention to:

Currently only 2% of India's workers have received formal skills training, according to Ernst & Young. That compares with 68% in the U.K., 75% in Germany and 96% in South Korea.

http://cnnmon.ie/1V1p0FL via @CNNMoney

Indian kids rank near the bottom on international standardized assessment tests like PISA and TIMSS.

http://www.riazhaq.com/2011/12/pisa-timss-confirm-low-quality-of.html

Pakistani kids are doing better than Indian kids on both math and verbal tests, according to a World Bank report.

Pakistan's grade 5 and 8 students outperform their counterparts in India, according to the World Bank report titled "Student Learning in South Asia: Challenges, Opportunities, and Policy Priorities"While 72% of Pakistan's 8th graders can do simple division, the comparable figure for Indian 8th graders is just 57%. Among 5th graders, 63% of Pakistanis and 73% of Indians CAN NOT divide a 3 digit number by a single digit number, according to the report.. The performance edge of Pakistani kids over their Indian counterparts is particularly noticeable in rural areas. The report also shows that Pakistani children do better than Indian children in reading ability.

http://www.riazhaq.com/2014/08/pakistani-children-outperform-indian.html

Riaz Haq said...

#Poverty Tour: #India's slum-dwellers to meet #WilliamAndKate in #Ambedkar Nagar. #Mumbai | via @telegraphnews http://www.telegraph.co.uk/news/2016/04/09/how-the-other-half-live-why-indias-slum-dwellers-are-keen-to-mee/ …

Today will be a case in point: after the couple land in Mumbai they will go straight to their first engagement, laying a wreath to the victims of the 2008 terrorist attack on the Taj Palace Hotel, then move on to a slum to see the work of three children’s charities, before rounding off the day with a charity gala dinner to raise money for the same charities, where celebrity guests will include the “Queen of Bollywood”, Aishwarya Rai Bachchan, and cricketing legend Sachin Tendulkar.
Their slum visit this morning will transport them to a world which could barely be more different from the Duke and Duchess’s palatial home life.

Anmer Hall, the Duke and Duchess’s home in Norfolk, could comfortably be divided into more than 100 typical dwellings in the Baba Sheb Ambedkar Nagar slum, where Saniya lives, meaning the Grade II* listed property would be home to upwards of 500 people, rather than four. They also have a London home at Kensington Palace.

A crude comparison, perhaps, but one which has clearly crossed the minds of Saniya and other pupils at the slum’s Door Step school. Many of them start work at the age of seven gutting fish or scavenging rubbish dumps for £3 a day and drop in to the school in the evenings to learn how to read and write.

The school’s founder, Bina Sheth Lashkari, said: “We have shown the children pictures of the Duke and Duchess and where they live. The children know they are going to meet a Prince and Princess and they have asked if they are like the Princes and Princesses in fairy tales. One of the girls asked if the Princess had big hair, like Rapunzel.


-----

In 33C heat they will have to pick their way through the stray cats and dogs foraging scraps of food, avoid the opaque brown puddles in the beaten earth paths and the jumble of electrical wires at head height, before being shown into one of the shockingly tiny homes, smaller than a walk-in wardrobe.


Kadeer said...

Riazbhai, you previously reported that Pakistan internet users penetration was 10% and India was 5% in 2009. http://www.riazhaq.com/2009/10/pakistans-28-billion-it-industry.html

In 2016, Pakistan has grown to 17.8% and India to 34.8%. http://www.internetlivestats.com/internet-users-by-country/

What are the reasons behind this slow growth?

Riaz Haq said...

Kadeer: "In 2016, Pakistan has grown to 17.8% and India to 34.8%. http://www.internetlivestats.com/internet-users-by-country/
What are the reasons behind this slow growth?"

India launched in 2008 while Pakistan did in in 2014, a six year gap.

It's pretty obvious given the fact that most of the Internet access in South Asia is via 3G/4G that rolled out in Pakistan much later than India.

Over the last two years since the 3G 4G rollout, Pakistan has experienced tremendous subscription growth to 26 million users in Feb 2016, much faster than the growth rate in India.

http://www.telecompaper.com/news/pakistan-tops-26-mln-3g4g-subscribers-in-february--1134458

Riaz Haq said...

#US #university in #Kentucky, Recruiting Students from #India to Fill Seats, Not to Meet Standards. #highereducation

http://mobile.nytimes.com/2016/04/20/us/recruiting-students-overseas-to-fill-seats-not-to-meet-standards.html

At Western Kentucky, 106 of 132 students admitted through the recruitment effort (in India) scored below the university’s requirement on an English skills test, according to a resolution adopted last fall by the graduate faculty council, which raised questions about the program. “The vast majority either didn’t have any scores or there wasn’t documentation of their language skills,” said Barbara Burch, a faculty member of the university’s Board of Regents.


“Hurry Up!!!” the online posting said. “Spot Admissions” to Western Kentucky University. Scholarships of up to $17,000 were available, it added. “Letter in one day.” The offer, by a college recruiter based in India, was part of a campaign so enticing that more than 300 students swiftly applied to a college that many had probably never heard of.

More than 8,000 miles away, at Western Kentucky, professors were taken by surprise when they learned last fall of the aggressive recruitment effort, sponsored by their international enrollment office. Word began to spread here on campus that a potential flood of graduate students would arrive in the spring 2016 semester.

The problem — or one of them — was that many of the students did not meet the university’s standards, faculty members said, and administrators acknowledged.

Western Kentucky’s deal with the recruiting company, Global Tree Overseas Education Consultants, is a type of arrangement that is becoming more common as a thriving international educational consultancy industry casts a wide net in India and other countries, luring international students to United States colleges struggling to fill seats. The university agreed to pay Global Tree a commission of 15 percent of the first year’s tuition of students who enrolled, or about $2,000 per student.

But as colleges increasingly rely on these international recruiters, educators worry that students may be victimized by high-pressure sales tactics, and that universities are trading away academic standards by recruiting less qualified students who pay higher tuition.

Riaz Haq said...

"9 out of 10 #Indians who eat #beef are from #Indian Institutes of Technology" #India's Minister Giriraj Singh. #IIT http://m.rediff.com/news/report/-nine-out-of-10-who-eat-beef-are-from-iits-giriraj-singh/20160421.htm …

The Modi minister, known for his controversial statements, dropped another bombshell on Thursday.
M I Khan reports.

Giriraj Singh, a member of Narendra Modi's council of ministers, now has a peeve against IITians.

"Aaj samaj mein jo bachche gir gaye hain ha, gau maans kha rahein hain. Padhe likhe dus log jo gau maans kha rahein hain unmein se nau IITs ke hain (People who have fallen in society eat beef. Out of 10 educated people who eat beef, 9 are from IITs)," Singh, the Bharatiya Janata Party MP from Nawada, Bihar, said on April 21.

Earlier, Singh demanded that the voting rights of couples with more than two children be revoked, to develop the nation.

"If Malaysia and Indonesia can make such a law, why can't we?" the minister asked, adding, "The nation won't progress without population control."

"There must be a balance. Hindus, Muslims, Sikhs and Christians -- all must have at least one to two children. Those who don't follow, their voting rights must be revoked," Singh declared.

"A law is needed on population control for all religions if development is required," he added.

On Wednesday, Singh said if India did not change its population policy and enforce a two-child norm for all religions, then the nation's daughters would not be safe and may have to wear a veil as they do in Pakistan.

Speaking at a cultural yatra in West Champaran's Bagaha town, Singh was apparently referring to Bihar districts Araria and Kishanganj, where the Muslim population has increased faster than the Hindu population.

Riaz Haq said...

Donald #Trump Use #indian accent to mocks Call Centres In #India. http://www.ndtv.com/world-news/donald-trump-mocks-call-centre-in-fake-indian-accent-1398585 … via @ndtv

Never the one to shy away from putting things bluntly, Republican presidential frontrunner Donald Trump has expressed his displeasure at India's outsourcing industry by impersonating a call centre representative in India.

However, just moments later, he goes on to call India a great place, asserting that he is not angry with Indian leaders.

At a campaign rally in Delaware, the billionaire from New York said that he called up his credit card company to find out whether their customer support is based in the US or overseas.
"Guess what, you're talking to a person from India. How the hell does that work?" he told his supporters.

"So I called up, under the guise I'm checking on my card, I said, 'Where are you from?'" Mr Trump said and then he copied the response from the call centre.

"We are from India," Mr Trump impersonated the response.

"Oh great, that's wonderful," he said as he pretended to hang up the phone.

"India is great place. I am not upset with other leaders. I am upset with our leaders for being so stupid," he said.

"I am not angry with China. I am not angry at Japan. I am not angry with Vietnam, India...all these countries."

Mr Trump mentioned the fake call to India during his remarks on what he described as "crooked banking".

Delaware, is a hub for the America's banking and credit-card industry. Topping the list include Bank of America, Citibank Delaware, M&T Bank and PNC Financial Services Group.

"They are making a lot of money," he said.

"You can't allow policies that allows China, Mexico, Japan, Vietnam, India. You can't allow policies that allows business to be ripped out of the United States like candy from a baby," Mr Trump said in his address.

"The manufacturing jobs are being stolen. Our jobs are being taken. We are losing at every front. There is nothing good. Our country does not win anymore. The jobs are being stripped. Factories are closing. We are not going to let this happen anymore," he said.

Mr Trump said he has as many as 378 companies registered in Delaware, where the Republican presidential primaries is scheduled on April 26 along with several other states.

He is leading in polls against his other primary rivals.

In his speech, Mr Trump praised Delaware's status as a tax shelter and slammed President Barack Obama for not using the term "radical Islamists" in the fight against terrorism.

"I want to run against crooked Hillary," he said, reiterating that a Trump vs Clinton race would bring the greatest turn out in the history of the American elections.

"We will stomp on Hillary Clinton no one's ever done."

He was also critical of Indian-American South Carolina Governor Nikki Haley, who did not endorse him during the primary.

Delaware has 16 delegates. Mr Trump has 845 delegates, followed by Ted Cruz (559) and John Kasich (148)

Riaz Haq said...

#India's #Modi won praise for 'slapping' #China, then came a humiliating U-turn on #Uighur leader visa. #Pakistan

https://www.washingtonpost.com/news/worldviews/wp/2016/04/25/indias-modi-won-praise-for-slapping-china-then-this-happened/

Patriotic chest-thumping over the weekend in India gave way to embarrassment and bitterness as the government made a very public U-turn on issuing a visa to Uighur dissident Dolkun Isa. He is the executive committee chairman of the World Uighur Congress, an organization that represents a predominantly Muslim ethnic group in China's far-west, and has been labeled a terrorist by the Chinese government. China issued a "red corner notice" to the international policing agency Interpol seeking his arrest more than a decade ago, but other governments have refused to act on the request.

Supporters of Prime Minister Narendra Modi's government, who are often self-conscious about how India matches up with China, took to social media over the weekend to celebrate the news that Isa had procured a tourist visa to India, using the hashtag #ModiSlapsChina. Many viewed the visa as a "slap" because China had used its clout at the United Nations earlier in
April to block India's attempt to have Masood Azhar, the alleged mastermind of an attack on an Indian air force base in January, designated an international terrorist.

Hua Chunying, a spokeswoman for the Chinese Foreign Ministry, was quoted in the Indian media as saying that "Dolkun is a terrorist on red notice of the Interpol and Chinese police. Bringing him to justice is due obligation of relevant countries.”

A spokesman for India's Ministry of External Affairs, Vikas Swarup, was noncommittal in his response, simply saying, “We have seen media reports and the ministry is trying to ascertain facts.”

On Monday, it became clear that India's various ministries had not coordinated closely enough, if at all, on Isa's visa, and its potential geopolitical ramifications, and they canceled the visa. Isa came forward with a statement expressing disappointment and said he could only speculate that Chinese pressure led to the reversal. The turnaround by the New Delhi government did not please Indians, with the hashtag #ModiBowsToChina topping India's Twitter trends Monday.

Riaz Haq said...

The Feud at #India’s Central Bank. RBI's Rajan's straight talk upsets #Modi ministers. #BJP - a @WSJ op-ed http://on.wsj.com/1UjEaoD via @WSJ

Is Reserve Bank of India Governor Raghuram Rajan on his way out? Earlier this month, a comment to a reporter by the head of India’s central bank drew fire from Prime Minister Narendra Modi’s party. Mr. Rajan played down talk of India as a bright spot in the global economy by citing an Indian proverb: “In the land of the blind, the one-eyed man is king.”

Commerce Minister Nirmala Sitharaman quickly declared that she “may not be happy” with Mr. Rajan’s choice of words. Junior Finance Minister Jayant Sinha echoed his colleague’s sentiments: “We are the shining star. I don’t agree with what the governor said.”

Senior Indian officials don’t usually admonish each other in public. That Mr. Rajan’s comment—an innocuous warning against premature hubris about high growth—drew ministerial backlash suggests trouble between the governor and the Modi administration. It could signal that Mr. Modi will refuse to extend Mr. Rajan’s tenure when his three-year term expires in September.

Picking a central-bank governor he likes is, of course, the prime minister’s prerogative. But letting Mr. Rajan go would be a mistake.

The governor, who was appointed by the previous Congress Party-led government, adds global credibility to India’s economic management. His candor and perceived sense of independence are strengths, not weaknesses. Mr. Modi and Finance Minister Arun Jaitley would be foolish to overlook this.

In India, where Reserve Bank governors are usually drab, the 53-year-old Mr. Rajan cuts a dashing figure. When he was appointed three years ago, the gossip columnist Shobhaa De called him “seriously hot.”

Indian media cover Mr. Rajan like a celebrity, chronicling his fondness for old Hindi movie songs, his penchant for running half-marathons, and his use of “dosanomics,” a reference to savory pancakes popular in southern India, to explain the dangers of high inflation.

Unlike most of his predecessors at the 81-year-old bank, Mr. Rajan earned his reputation overseas before returning to India. In 2003, the International Monetary Fund appointed Mr. Rajan, a professor at the University of Chicago at the time, as its youngest-ever chief economist, and the first from a non-Western country.

Two years later, Mr. Rajan warned of a financial bubble at the Federal Reserve Bank of Kansas City’s annual policy conference at Jackson Hole, Wyo. When the global financial crisis struck in 2008, many observers hailed Mr. Rajan for his prescience.

Four years ago, Mr. Rajan returned to India to serve briefly as chief economic advisor to then-Finance Minister P. Chidambaram before taking over at the Reserve Bank.

To some in the ruling Bharatiya Janata Party, Mr. Rajan is tainted by his appointment by the Congress Party. Nor did he help his own case by coming up with a sketchy index in 2013 that appeared designed to show that the western state of Gujarat, then headed by Mr. Modi, was not among India’s most developed.

Since Mr. Modi’s election two years ago, Mr. Rajan has been pressured to boost growth by cutting interest rates. Traditionally, India’s central-bank governors haven’t enjoyed as much independence as their American counterparts, but Mr. Rajan has guarded the bank’s mandate, established last year, of taming inflation.

He met the bank’s target by bringing Consumer Price Index inflation below 6% in January. At the same time, over the past 15 months, the Reserve Bank cut interest rates by 150 basis points to 6.5%, its lowest in five years.

Some also disparage Mr. Rajan’s tendency to speak about issues outside his area of responsibility, in ways that can appear critical of the government. In a speech last year, the governor warned against fetishizing strong governments by evoking Hitler.

During a national debate about rising intolerance, Mr. Rajan lectured students at the Indian Institute of Technology in Delhi about the country’s “tradition of debate and an open spirit of inquiry.”

Riaz Haq said...

#Pakistan #agriculture component of #GDP to be flat this fiscal year 2015-16 due to #drought, crop losses http://www.world-grain.com/news/news%20home/LexisNexisArticle.aspx?articleid=2577597560 …

Pakistans neglected agriculture sector is all set to face a major blow as the farm sector growth is expected to touch zero in the current fiscal year mainly because of negative growth in major crops including cotton, rice and sugarcane as well as dwindling commodity prices in international market, a senior economist said on Tuesday.

The agriculture growth might touch zero in the current fiscal year mainly because of negative growth of major crops like cotton, rice and sugarcane and poor performance of minor crops, said Dr Hafeez A Pasha, former finance minister, when contacted for his comments. The livestock might not be able to compensate overall farm growth up to the desired mark during the outgoing financial year.

Dr Pasha said whenever the countrys agriculture sector witnessed a dip; its overall gross domestic product (GDP) growth rate never crossed 4 percent in any year mainly because the countrys overall economy was largely dependent upon agriculture in terms of trade, commerce and agri-based exports.

Sources, however, said in the wake of expected flat growth of agriculture sector, which will remain in the range of just 0.3 to 0.5 percent, Pakistans prospects for achieving overall GDP growth rate have also plunged into danger zone as the growth rate will be hovering around 4.5 to 4.7 percent maximum for outgoing fiscal year against desired envisaged target of 5.5 percent in 2015-16.

When contacted a top official of the Pakistan Bureau of Statistics (PBS), he said the National Accounts Committee (NAC) was expected to meet by mid of next month. The PBS is not responsible to collect primary agriculture data as NACs agriculture committee will provide data to the PBS on the basis of which the farm sector growth will be estimated on provisional basis.

As the PBS did not see the data so far so it would be premature to give any judgment on this issue, the official said. But he added that the wheat crop might produce positive results mainly because of its output achieved in Barani areas of the country.

Many independent economists believe that the countrys agriculture sector might witness a negative growth in the current fiscal year but some economic managers claimed that the farm growth might slide into positive side by demonstrating nominal growth just around 0.5 percent. However it would be definitely missed out the fixed target of 3.9 percent for the current financial year.

For finalizing the Budget Strategy Paper (BSP) for next three years, Finance Ministry refused to bring down its envisaged GDP growth rate target of 5.5 percent for the current fiscal year despite insistence of Planning Commission to cut it to around 5 percent.

Ministry of Finance still appeared confident that the manufacturing and services sector could play major role to jack up overall GDP growth rate over 5 percent as they claimed that the sale of cement is increasing.

Overall, the agriculture sector grew by 2.9 percent in last fiscal year of 2014-15, which was lower than the envisaged target growth of 3.3 percent but higher than the growth of 2.7 per cent achieved during the fiscal year 2013-14.

The agriculture sector is targeted to grow by 3.9 percent this year on the basis of expected contributions of important crops (3.2 percent), other crops (4.5 percent), cotton (5 percent), livestock (4.1 percent), fishing (three percent) and forestry (four percent). 2016 Global Data Point.

Riaz Haq said...

#India’s sharp growth picture gets fuzzy. #Indian GDP is rough estimate, not actual measurement http://on.wsj.com/1STK2Te via @WSJ #Modi #BJP

India’s economy expanded by 7.3% last year, outpacing every other major nation, including China, for the first time in nearly two decades.

But as with most developing countries, where official statistics can be dicey even when they aren’t showing world-beating growth, India’s economy defies easy measurement. Most enterprises are tiny and unregistered, and most workers are employed off the books. The government’s infrequent surveys represent only a best guess of the value being added in back-alley workshops, outdoor markets and other cash-based corners of the economy.

So even if India’s measurement of gross domestic product, a broad indicator of activity, isn’t thought to be politically manipulated like China’s, it should come with a warning label: Handle with care.

GDP in India, “much more than in other economies, is more an estimate than a measurement,” said Neelkanth Mishra, a Credit Suisse economist in Mumbai.

The fog surrounding India’s GDP places challenges before analysts and policy makers—and just plain baffles some of them. The country’s central bank, sensing an economy running at less-than-full blast despite strong headline growth, has cut its main interest rate five times since the start of 2015.

One reason for the data murkiness can be found on Lal Bazar Street, a busy thoroughfare of tea merchants, typists-for-hire and a sitar shop in the heart of Kolkata, the country’s onetime colonial capital.

Within the dingy commercial buildings that line the roads in all directions are hundreds of addresses used to register shell companies, or ones used for tax-avoiding financial maneuvers and little else, tax authorities say.

Yet because these firms regularly file balance sheets to the government, they appear in a new official database of corporations—and get counted when statisticians tot up India Inc.’s contribution to national output.

India’s numbers have been under a microscope since it revised methods for estimating GDP last year, causing performance in earlier years to shoot up. Growth stayed brisk throughout 2015 even as exports, cargo traffic and other indicators disappointed.

A report from India’s Ministry of Finance said data-related uncertainty was causing economic signals to be “mixed, sometimes puzzling.”

The GDP revision included updates large and small. Based on an academic study of “dung evacuation rates,” goats and sheep were found to be contributing more to the economy, as producers of natural fertilizer, than previously thought. A much wider array of financial services is now being counted. But there are still areas where some observers, including the International Monetary Fund, see India’s data falling short.

To strip price changes out of a wide swath of GDP, for instance, India uses its wholesale price index—which, thanks to lower oil prices, has been decreasing for 17 straight months.

But many businesses, particularly services like finance and information technology, haven’t benefited much: Retail prices are still climbing at around 5% a year overall. If India’s statisticians were factoring in more of these price rises, then their inflation-adjusted GDP figures would be lower.

In a March report on India, the IMF criticized the use of wholesale prices in GDP. In a written response to questions, the country’s Central Statistical Office acknowledged the issue, but said that until India updates its inflation measures, the wholesale price index “remains the best available alternative.”

“There’s no rhyme or reason why the service sector would be deflated by WPI,” said Kunal Kumar Kundu, Société Générale SA’s India economist. “It’s basically a data availability issue. That will always continue to be a challenge.”

Riaz Haq said...

#Indian workers chasing dreams and dollars: #India and the #H1B visa http://www.sfchronicle.com/business/article/Chasing-dreams-and-dollars-India-and-the-H-1B-7382822.php?t=2af45939e7&cmpid=twitter-premium … via @sfchronicle

On the outskirts of the city, an ancient temple, surrounded by a buzzing market with food and flower stalls, rises on the banks of the Osman Sagar Lake. It is barely 8 a.m., but for hours already, the temple has been surrounded by a swirling mass of petitioners. Hundreds circle it quickly but silently, praying to the Hindu deity Balaji to grant the wish that has brought them here: to obtain a guest worker visa that will allow them to take their high-tech talents to America.

The Balaji Visa Temple is among a handful of such shrines that have sprung up in recent years, offering Indian workers hope of divine help in obtaining a temporary U.S. specialty-occupation visa, familiarly known as an H-1B. Those who receive them can spend three to six years working in the U.S. — a ticket, they believe, to a better, more financially secure future.

---

Those who are successful face other concerns: Navigating a system in which their employer controls their visa, and thus their legal status, leaving some feeling like indentured servants with no power over working hours or conditions. Having wages sometimes shaved through fees assessed by sponsoring companies, who may contract them out for other work.

And increasingly, being pointed to by critics of the H-1B program, including GOP presidential candidates Donald Trump and Texas Sen. Ted Cruz, as a threat to American workers.

Still, they come in waves to cities like Hyderabad and shrines like the Balaji temple, eager to vie for a once-in-a-lifetime experience. Some have seen their applications put forward year after year without success, putting off marriage or finding a permanent home in hopes that this will be the year they get to America. To jobs that will boost their careers and pay far more than they can earn here. To a few years of adventure in the land of Hollywood and Disney World.

Every year, thousands of Indian workers from Hyderabad alone get H-1Bs, while Indians overall make up more than two-thirds of those working on H-1B visas. Their growing presence has spurred calls for reform of the system on both sides: those who want the limited number of visas expanded and those who say the system has gotten out of control.

The number of visas available, however, has always been limited. Since 2004, the cap has been set at 85,000 new H-1Bs annually — 65,000 for foreign workers with at least a bachelor’s degree, another 20,000 reserved for those with advanced degrees from U.S. universities. Trade agreements reserve up to 6,800 of those visas for skilled Chilean and Singaporean workers.

Exempt from the cap are skilled workers employed in higher education, nonprofit research or government research. Also not counted in the cap are extensions of an H-1B for a second three-year term.

Since 2013, the huge demand for H-1Bs has prompted a computerized lottery to dole out the visas. That has spurred growing criticism of India’s multibillion-dollar outsourcing industry, which supplies legions of workers for U.S. companies every year. In fiscal year 2014, the most recent year data are available, 67 percent of H-1B visa recipients were from India, the highest proportion in at least 18 years.

Indian companies, including Tata Consulting Services, Wipro and Infosys, submit tens of thousands of visa requests on behalf of U.S. clients each year. Critics say they are effectively gaming the lottery — depriving smaller companies of the chance to fairly compete for H-1Bs and taking visas that could go to more highly skilled, higher-paid workers for low-level, lower-paid programmers.

Riaz Haq said...

#Modi Bolsters #India’s Ties With #America as #Trump's Vows to Limit immigration Worry Indian officials. #Obama #H1B

http://www.nytimes.com/2016/06/08/us/politics/narendra-modi-us-india.html?_r=0

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Another reason Washington and New Delhi have grown so close is the increasingly testy relationship between the United States and Pakistan, India’s longtime rival. Although Pakistan is formally an ally of the United States, American officials have made clear that India has displaced Pakistan in American interests and hearts.

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“We have much more to do with India today than has to do with Pakistan,” Defense Secretary Ashton B. Carter said in April. “There is important business with respect to Pakistan, but we have much more, a whole global agenda with India, agenda that covers all kinds of issues.”

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The two sides also announced that they intended to complete a deal in which India will buy six nuclear reactors from Westinghouse by June 2017, fulfilling an agreement struck in 2005 by President George W. Bush. The price is still under discussion, but more difficult issues like liability have been resolved.

“We continue to discuss a wide range of areas where we can cooperate more effectively in order to promote jobs, promote investment, promote trade and promote greater opportunities for our people, particularly young people, in both of our countries,” President Obama said in the Oval Office during the meeting.

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“The United States is well aware of the talent that India has,” Mr. Modi said in Hindi. “We and the United States can work together to bring forward this talent, and use it for the benefit of mankind and use it for the benefit of innovations and use it to achieve new progress.”

Mr. Modi has made clear that he intends to set aside decades of standoffishness — rooted in India’s colonial experience — to cement closer ties with Washington, in part because the next American leader may not share President Obama’s enthusiasm for India.

The news media in India has extensively chronicled comments by Mr. Trump that critics have said were racist, his “America First” views and his unorthodox campaign. While Mr. Trump, the presumptive Republican presidential nominee, has said little about India, his vows to tighten immigration policies worry Indian officials.

“Modi wants to get as much as he can out of Obama’s last months in office,” said Ashley J. Tellis, a senior associate at the Carnegie Endowment for International Peace.

--
Mr. Trump has vowed to “cancel” the Paris climate agreement if elected, something Mr. Obama is eager to prevent. Once the accord enters into legal force, no nation can legally withdraw for four years.

“If the Paris agreement achieves ratification before Inauguration Day, it would be impossible for the Trump administration to renegotiate or even drop out during the first presidential term,” said Robert N. Stavins, the director of the environmental economics program at Harvard.

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The two sides also announced joint efforts for the United States to invest in India’s renewable energy development, including the creation of a $20 million finance initiative.

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The two countries finalized a deal that allows their forces to help each other with crucial supplies, and the United States formally recognized India as a major defense partner, which should allow India to buy some of the most sophisticated equipment in the United States arsenal.

India’s increasing willingness to form military partnerships with the United States is, in part, a result of its deepening worries about China. Recent patrols by Chinese submarines in the Bay of Bengal have unnerved New Delhi, and a 2014 visit to India by the Chinese president, Xi Jinping, did nothing to soothe Indian sensibilities, as Chinese troops made an incursion into border territory that India claims as its own.

China’s refusal in the months since to resolve the territorial claims at the heart of the standoff has quietly infuriated Indian officials.

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Riaz Haq said...

How Much Longer Can India's IT Sector Hide? Bloomberg View

Companies such as Infosys, Wipro and Tata Consultancy Services (TCS) grew into global behemoths precisely because they sprung up in Bengaluru -- far from the watchful eye of Delhi-based bureaucrats. The tech industry fell into a regulatory blind-spot, unhampered by red tape and the labor laws that strangled other sectors. As one Indian minister noted over a decade ago, Indians do well “in IT and beauty contests, the two areas that the government has stayed out of." States like the one Bengaluru is in continue to exempt IT companies from especially suffocating regulations.

These firms offered businesses around the world an efficient, low-cost way to outsource their in-house IT work. Building and maintaining enterprise-specific IT infrastructure for overseas clients provided a steady stream of income. India could beat the competition for this work because of its large pool of trained, low-cost engineers.

Once wildly successful, this model has now begun to run into a whole host of problems.

First, slowing growth in the West means that many companies have cut down on the discretionary spending that once went into outsourcing contracts. Second, more restrictive visa laws in the West are making it tougher for Indian companies to get qualified engineers into their clients’ offices.

Third, that pool of Indian engineers isn’t inexhaustible. Salaries have begun to rise, threatening a business model based on generating relatively little revenue per employee. As far back as 2013, the Economist quoted one IT executive as saying that, for IBM, “the total cost of its employees in India used to be about 80% less than in America; now the gap is 30-40% and narrowing fast."

Fourth and most importantly, the technological landscape is shifting dramatically. Companies could once draw clear distinctions between the core of their business and extraneous IT work that could be outsourced. Now, with the shift to digital services and cloud computing, more and more companies view IT as integral to the transformation of their overall business. They're looking for higher-value services and more innovation than Indian IT companies have traditionally provided. Infosys's struggles with its core consulting revenue led to it declaring disappointing results last Friday.

Bengaluru's flagship companies are hardly unaware of this. Infosys has begun training its employees and board in “design thinking" -- a buzzword for prototype-driven innovation -- hoping this will help prepare them for a future in which they have to serve as all-around advisers for clients seeking to make their businesses fully digital. TCS says its revenue from such work is growing at 10 percent annually.

The problem is that these kind of projects don't require masses of low-priced engineers. TCS is hiring fewer people and laying off some.

A wave of job cutbacks could attract the baleful glare of the state. In a hangover from India's socialist past, the government has traditionally been overprotective of workers in the formal sector. While the roughly 3 million people who work in the IT industry are a tiny drop in India's billion-plus population, they account for a huge chunk of the organized labor market -- almost a quarter of the formal work force.

How will politicians and bureaucrats react to IT champions radically changing their operations, perhaps shrinking or even trying to move offshore? When some Indian airlines, as part of a necessary restructuring, tried to trim bloated bits of their work force a few years ago, the government pressured them into retreating. It's reasonable to fear that similar meddling might be in store for Indian IT.


http://www.bloomberg.com/view/articles/2016-07-17/job-cuts-could-bring-unwanted-attention-to-india-s-it-sector

Riaz Haq said...

#India's #startup bubble has already burst. #Modi #Achhedin http://cnnmon.ie/2dVGDWz via @CNNMoney

After a sustained funding frenzy, investor enthusiasm for the country's tech startups has fallen sharply this year. Weaker firms are laying off employees and some have closed up shop altogether.
Startup funding in the second quarter plummeted to $583 million from its recent peak of nearly $3 billion in late 2015, according to CB Insights. It's a sharp turnaround for a sector that attracted more than $8 billion last year.
"We've already felt the effects of what that bubble would be," said Arjun Malhotra, the co-founder of Indian startup incubator Investopad. "A lot of the companies that were high performing, they are crashing now."
The slowdown has occurred despite favorable conditions: The broader Indian economy is booming, and inflation is low. Global investors are on the hunt for the next Facebook (FB, Tech30) or Amazon (AMZN, Tech30).
With 1.3 billion citizens and a surplus of skilled IT workers, Indian startups proved irresistible to many investors. The success of homegrown e-commerce darlings Snapdeal and Flipkart, and ride-sharing app Ola, added credibility.
Yet there is a simple explanation for the reversal: Investors say India's tech sector experienced a classic bubble, similar to the one that rocked Silicon Valley when it burst in 1999.
"I think India is going through its first bubble," said Kashyap Deorah, a former Silicon Valley entrepreneur who now runs a startup in Delhi. "It is a bubble and it is normal."

Riaz Haq said...

A Whiff of Scandal at Cognizant Systems as #Indian IT Slows Down. #H1B #BodyShop #India #technology http://thewire.in/72446/whiff-scandal-cognizant-cts-technology-systems-indian-slows/ … via @thewire_in

New Delhi: Software services firm Cognizant, along with most of its peers in the broader Indian IT industry, hasn’t had a particularly great business year.

The New Jersey-based firm — which has four out of every five of its employees deployed in India — has downgraded its revenue forecast two times since January, starting from “between 10% and 14%” to “at-best 13%” and finally “around 8.5-9.5%”.

The company’s 2016 revenue forecast is not only sharply down from its growth last year (when it clocked a cool 15%), but is also its slowest pace of growth since 1997; which is when Cognizant as we know it today officially came into existence.

Adding to this is a potential scandal in the making. Two weeks ago, in an early morning Nasdaq notification, Cognizant announced that it had commenced an internal probe into whether “certain payments relating to facilities in India were made improperly and in possible violation of the US Foreign Corrupt Practices Act”.

The market’s reaction was swift: Cognizant’s shares closed down a little over 13% on the day of the stock exchange notification, wiping out nearly $4.5 billion off the company’s market value. Shareholder reaction was equally swift and similarly punishing, with a class-action lawsuit being filed against the company last week.

Cognizant, however, isn’t alone. Rivals Infosys and TCS have their own controversies they are grappling with — one stemming from a massive lawsuit over possible trade secret and IP violations and the other from a crisis of leadership.

Both Infosys and TCS have also slashed their own growth projections for this year. TCS in particular ended up backpedalling after announcing at first that there was nothing to worry, but then later expressing concern over demand from the BFSI sector, a massive vertical for most Indian IT companies.

“The stage is now set for what could be the worst second quarter performance in almost a decade. Revenues of the top five large cap companies are expected to grow by around 1.5% quarter on quarter. Consequently, Nasscom is likely to cut its 10-12% constant currency industry growth target as well, which it has been holding onto stubbornly,” the head of a large Mumbai-based brokerage, who declined to be identified, told The Wire.

What’s going wrong?

When financial headwinds have hit the IT industry in the past, CEOs trot out the usual suspects. Softening sectoral specific-demand, US elections, global protectionism, a particularly nasty dollar-rupee exchange rate and often whatever is the latest geo-economic event that could threaten business.

This time around, some of these factors are in play, although most of them haven’t had significant impact. BFSI (banking, financial services and insurance) sector clients are indeed pulling back on discretionary spending. The run-up to the US election has had Congress focusing (mostly unsuccessfully) on plugging H1B visa loopholes. Brexit is turning out be a minor spoilsport.

“Cyclical and seasonal factors like that are always taken into account at the CFO level and are seen as something that passes eventually. More fundamentally though, what is happening right now is that IT firms are being hit at both ends by the general reducing of their traditional bread-and-butter business and an inability to capture meaningful digital business,” a senior executive of blue-chip IT firm, who declined to be identified, told The Wire.

Digital business growth

Multiple analysts and executives across the IT industry The Wire spoke to offered up numerous examples of this two-punch blow.

Riaz Haq said...

#Tata Boardroom Battle: 3 Tata execs quit adding to uncertainty at #India's congolmerate http://reut.rs/2dX8Kls via @Reuters

Three senior group executives at India's Tata Sons have resigned, people close to the matter told Reuters on Saturday, as management woes appeared to deepen at the $100 billion conglomerate following the stunning ouster of its chairman.

The three executives were members of an executive council disbanded after Tata dismissed chairman Cyrus Mistry on Monday. The council, comprising five senior Tata group executives and Mistry, was tasked with creating long-term value for stakeholders and boosting returns on investment.

Those who quit are group human resources chief N.S. Rajan; group business development and public affairs head Madhu Kannan; and group strategy executive Nirmalya Kumar.

Reuters could not reach any of the three for comment. Tata did not respond to an e-mail request for comment on Saturday.

Reuters reported earlier this week that the other two council executives, Mukund Rajan and Harish Bhat, would take on senior level responsibilities within the Tata group.

One person close to Tata said there was no certainty all the positions would be re-filled as the group's structure is likely to change with Mistry's exit. Another person, however, said replacements could be named as early as next week, though there was no management crisis as each Tata company has its own team of public affairs and business development executives.

But some governance experts say the resignations of senior executives risk increasing the sense of uncertainty at Tata.

"In the short term, obviously there'll be some disruption at the group level" said Shriram Subramanian of InGovern, a shareholder advocacy group. "People leaving at senior levels shows there's a lack of confidence between the two sides, and that needs to be reinstated at the earliest to contain any longer-term damage."

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In a leaked letter to the Tata board, Mistry has said he was opposed to Tata's aviation partnerships with Malaysia's AirAsia Bhd and Singapore Airlines.

In the case of Air Asia, a forensic investigation had found "fraudulent transactions" of 220 million rupees ($3.29 million) involving "non-existent parties", he alleged.

That prepared the ground for a "probe into the allegation of mismanagement of funds," said an official at the national Enforcement Directorate, on condition of anonymity.

The agency was not immediately available to comment. Tata did not respond to Reuters questions on this matter. An AirAsia India spokeswoman said she had no immediate comment.

India's capital markets regulator is already looking into Mistry's allegations related to violations of corporate governance rules at Tata.

Riaz Haq said...

After pink slips, #UCSF tech workers train their foreign replacements from #India. #Trump #Jobs http://www.mercurynews.com/2016/11/03/after-pink-slips-ucsf-tech-workers-train-their-foreign-replacements/ … via @mercnews

In a move that could spread to other universities, about 80 information tech workers at UC San Francisco are facing layoffs and have begun training their replacements — lower-paid tech workers from an Indian outsourcing firm.

The outsourcing, laid out in a $50 million contract with Indian employment firm HCL Technologies, is unusual among public institutions, experts say. The school expects to save $30 million over five years.

“I don’t know of any other university that’s done this,” said Ron Hira, a Howard University professor who studies immigration and outsourcing. “At some point, you start to cross these ethical lines.”

The majority of the outsourced work will be done in India. Additional IT staff may be brought to the UCSF campus from overseas on H-1B visas, according to public documents.

Employees and advocates are criticizing the move, saying it will leave the university and the UCSF Medical Center staff with inferior service and could endanger medical data. The UCSF workers, due to lose their jobs in February, are training their replacements, sometimes via videoconferencing to India.

U.S. Rep. Zoe Lofgren on Tuesday asked University of California President Janet Napolitano to reverse the decision. Lofgren wrote that replacing some of the workers with H-1B visa holders would be a misuse of the visa

“I think it is proper to expect our major public institutions, such as the University of California, to comply with both the letter and the spirit of the law,” Lofgren said.

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“They can replace just about any IT job with H-1B workers,” he said. “It’s obviously a major issue.”

UCSF offers graduate degrees in medicine, nursing, dentistry and pharmacy and has a $5.4 billion annual budget, with about two-thirds earmarked for employee salaries and benefits. Administrators say the university faces fiscal challenges.

“We’re under a great deal of pressure,” Joe Bengfort, chief information officer at UCSF, told employees at a staff meeting earlier this year, according to a video of the meeting. “Outsourcing is not a silver bullet and we don’t treat it as such, but it’s probably the most difficult thing we’ve done.”

The cuts amount to almost 20 percent of the university’s IT staff and fall heavily on back-office operations, according to a presentation made to employees.

The school has also contracted with cybersecurity firm FireEye and Dell for other IT functions.

In a statement, the university said the new contracts “will not only increase savings but also strengthen cyber security and enhance IT quality and consistency.”

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The move is similar to layoffs at Disney and Southern California Edison last year, where employees were forced to train their lower-paid replacements. Disney laid off about 250 IT workers, although some were brought back in different roles. Southern California Edison planned to pare about 500 workers through layoffs and attrition to outsource its operations.

More than a decade ago, the UCSF Medical Center contracted out its medical transcription. In 2003, a Pakastani transcriber threatened to post confidential patient records unless she received more money. The threat was eventually withdrawn.