A recent report suggesting that India-based companies have created more than 91,000 jobs in the U.S. and contributed to US$ 15 billion in investment, is a testament to the growing influence of Indian economy. It also drives home the point that India’s private sector has made significant progress since the country’s economy was liberalised in 1991.
The 90s also witnessed a host of American companies setting up offices in India for handling backend activities. Availability of skilled workers, well-versed in English, quickly transformed India into an offshore hub, with business process outsourcing (BPO) accounting for the bulk of the demand.
Outsourcing has been a Contentious Issue in the U.S.
Although outsourcing has had a massive impact on the Indian economy, accounting for nearly US$ 11 billion in annual revenues in 2012, many in the U.S. have derided it for creating long-term structural unemployment. The backlash against outsourcing has led to accusations that India is a ‘poacher’ of American jobs. It is in the context of this torrid past that the findings of CII and GT are remarkable.
The creation of jobs in the U.S. by Indian companies is not limited to behemoth economic centres, such as New York or California, but it encompasses all the 50 states. Furthermore, contrary to popular belief, the jobs have not only been created in the information technology (IT) sector, but also in pharmaceutical, mining, life sciences, and healthcare.
Indian Companies Optimistic About Doing Business in the U.S.
The findings of the survey by CII and GT reveal a deep sense of trust and optimism among Indian companies about their prospects in the U.S. The job creation by Indian companies is well supported by CSR activities, which includes providing assistance to local communities.
The positive outlook on doing business in America can be gauged from the fact that 84.5% respondents in the CII-GT survey admitted to making more investments in the United States in the near future. Further, around 90% of the respondents said they planned to hire more employees locally in the next five years.
India’s stature in the world economy is growing, as many western economies are struggling to recover fully from the economic crisis of 2007-08. The country, along with China, is being tipped to become the next economic powerhouse in the near future. Indian companies, which in the past used to be concerned about competition from foreign firms, are setting up their business units far and wide.
Strengthening Indo-U.S. Ties Need of the Hour
Economic ties between India and America have improved over the years as the two countries look to consolidate their position amidst growing Chinese dominance. America sees India as a natural, reliable partner, both politically and economically, owing to its strong democratic environment.
The strengthening of Indo-U.S. ties has augured well for eroding entry barriers for trade and commerce, and it is expected that more Indian companies will expand their presence in the U.S. This would lead to creation of more jobs, and increase in contribution to the U.S. economy. From being perceived as a beneficiary of outsourcing, Indian companies could contribute to mitigating America’s unemployment problem.