U.S. IMMIGRATION POLICY - When will we see an H-1B philosophy in India?

The U.S., a nation of immigrants, has modified immigration laws every decade or so to reflect the needs of American economy ever since 1891 when the first Immigration Act was passed. Traditionally immigration policies were meant to serve the needs of an insulated, domestic U.S. economy; however the 21^st century has created a new challenge. In order to compete globally, U.S. now needs to design policies that respond to both, global and domestic economy, rather than only domestic economy.

The centerpiece in this new era of immigration is the H-1B visa for specialty workers, started in 1990, which is heavily used by U.S. companies to import skilled IT staff. Many of these entities are actually U.S. arms of foreign companies who provide a range of IT services to their clients in the U.S. The letter by senators Durbin and Grassley is a simple exercise in determining if these companies are complying with U.S. law, and such letters are common practice when ever a lawmaker desires to gather more information.

The facts will be known soon once the nine companies submit the details they have been required to furnish, and we can probably expect that all of them have been complying with laws. However, the letter also serves to investigate to what degree Indian firms have taken advantage of the loopholes in a broken system. The core question relates to wages – are the H-1B employees being hired on a similar salary as their American counterparts? The current laws are framed such that companies can be in compliance, yet can pay a lower salary to the new hire, thus the question for these nine Indian companies is not whether they are wrong in law, but to what extent do they “under-pay” their hires? This behavior can be exhibited by any company, be it of Indian origin, or a hundred year old American company, so there is nothing “Indian” about this.

If, as is expected, the targeted Indian firms have been in compliance with law then there can be virtually no penalty since they have not broken any law; but yes if any one has been under-paying then they can expect immense pressures from the American public, their customers, and U.S. lawmakers who will ensure that wages are now at par with U.S. economy’s statistical averages. The data collected by the U.S. Department of Labor is inadequate and is not verified sufficiently – thus a scientific analysis so far has not been possible, though reports by some advocacy groups say that average H-1B salaries are about 20% lower than their American counterparts.

The complicated nature of U.S. immigration debate is further highlighted when critics argue that U.S. policy should attract long term talent, and blame the H-1B program of not helping America’s competitiveness by citing the fact that Infosys applied for 22,590 H-1B visas and requested 99 green cards in 2006, while Wipro applied for 19,450 H-1B visas but only 69 green cards in 2006.

While we await the findings of the letter, India will be well served to keep four things uppermost in mind. One, hopefully these firms have been in legal compliance, however if they have indulged in wage arbitrage then in future they will need to rectify their wages. Indian firms need to be globally competitive, and that includes playing by fair rules in any market they operate, be it in India or in the U.S. Two, this whole matter is currently under Congressional purview, and U.S. administration has little or no role, thus any arguments that are made should reach the U.S. lawmakers rather than the administration. Unless the industry complains to the Indian government and then the matter is taken up with the U.S. administration.

Thirdly, India needs to pay acute attention to WTO Mode 4 negotiations to ensure that Indian services companies operate with utmost ethics and are not discriminated against in any market. And, lastly, most urgent, this is a wake up call for India to learn from the example of the U.S. which goes to such lengths to attract talent; and think about its own policies for attracting worldwide talent and building a competitive Indian economy – an H-1B program in India?

U.S. - INDIA NUCLEAR DEAL - Imagineering Atoms for Peace and Trust. In 2007, we need to leverage 1953 and 1959

New Delhi & Washington, DC - The regime of Atoms for Peace enunciated by Eisenhower in 1953, has guided the utilization of atomic energy globally. President Eisenhower's legacy has at least prevented any nuclear warfare ever since – but now, half a century later, it is time to modify it into Atoms for Peace and Trust in order to serve the geo-strategic and economic needs of the U.S. and India in the 21^st century. The birthing of Atoms for Peace and Trust is rooted in history, diplomacy, contemporary geo-politics, and cross-cultural trust.

· Reminder to Indian Leaderships – 1959, and 2007

India was capable to test a nuclear device in 1959 or so, and by not testing till 1974 it fell behind China, which tested in 1964 and joined the nuclear club. India’s decision has had a most profound negative impact over the past half century on India’s geo-position in the world, especially vis-à-vis China. India’s loyal adherence to Atoms for Peace till 1974 cost it heavily.

The 123 agreement has presented an opportunity after 50 years for the Indian leadership to again measure the landscape and take steps, which fifty years hence should not seem like the oversight of 1959. These steps include immediate intervention at highest political levels – PM Singh is urged to speak with President Bush, Speaker Pelosi, and explain why India's nuclear economics is running head-on with the constraints in the Hyde Act, and imagineer a way forward. He must be backed by intense diplomacy, and faces the task of achieving India’s economic interests by forceful persuasion in private diplomacy and in public, if need be.

It is almost two years since July 18, 2005, and it is most unfortunate that sections in the U.S. leadership are under the impression that India is being “greedy”, and is asking for more after having agreed to a deal. There is something drastically amiss here. The onus is on India to clarify how things have come to this pass, and take remedial steps.

If, as Indian negotiators say, India had all along pointed out its objections and handed over a 12-page dossier to the U.S. as early as July 2006, then the creation of this perception gap between Washington, DC and New Delhi has been a failure on India’s part to communicate loud and clear. Key points from the 12-page dossier and Singh’s speech should have been vigorously and repeatedly informed to every lawmaker, media, and think tanks, and red flags waved against the draft bills at each stage of the law making process.

The paid lobbyists of the government of India, the Indian American lobbyists, and corporate lobbyists have done a great job in building a general favorable environment, but we all also have failed to communicate. Most lobbyists glossed over India’s objections, thinking that this was another one of those typical Indian negotiating styles, and that the strategic context of the deal will awe India into an agreement. This was a very big mistake – Indian objections were not properly analyzed and communicated to the target audience.

Thus, between 1959 and 2007, there are two major lessons for India. One, do not let go of another strategic opportunity which will affect the next century of Indian global aspirations; and second, communicate aggressively and clearly. On both of these counts it is now incumbent upon Indian leadership led by PM Singh to take the charge and move immediately.

· Reminder to U.S. Leaderships – 1953, and 2007

When Eisenhower conceptualized and executed his nuclear paradigm in 1953, it is well known that he took a calculated risk, since “…Atoms for Peace threatened to lead to greater nuclear proliferation and could contribute to the spread of nuclear weapons throughout the world. Eisenhower recognized these dangers but believed that the risks were acceptable and that potential benefits justified them.” 2007 Half a century later, the U.S. is poised at another such juncture in world affairs.

Atoms for Peace deftly integrated the exploitation of the atom for peaceful and also military purposes, while also capturing the economic potential for the U.S. so that it did not lose out to Soviet, British, or French competition in the world’s nuclear energy markets. Eisenhower helped India develop civil nuclear program through Atoms for Peace, and Nehru upheld the trust and refused to test in 1959 before China did in 1964, though India had the scientific and technical capacity to test at that point of time, as recorded even in Eisenhower Archives.

India risked its security – China invaded India in 1962. Even after that, until India felt threatened by the ping-pong diplomacy of Kissinger with China; and the U.S. turned militarily against India vis-à-vis East Pakistan in 1971; the then Prime Minister, Mrs. Gandhi refused to test till 1974. It may safely be concluded that India therefore will not test, until its supreme national interest is threatened.

Meanwhile, India’s nuclear program even before Atoms for Peace, and ever since 1948 under its founding father Dr. Bhabha has been built around the philosophy and economics of using a home resource versus an imported raw material. The technology is not exactly there yet, but signs are clearly positive that in next 10-20 years India could jump-start its nuclear energy production where the majority input will be domestic thorium. The 123 agreement is striking at the heart of this paradigm by denying reprocessing rights.

The lesson of 1953 for the U.S. leadership is clear – it should imagineer a newer paradigm of Atoms for Peace that will look into the challenges of the 21^st century rather than of an era long past. President Bush and U.S. leadership now face an Eisenhower-ian moment – to take a calculated risk that if India tests it will be only to protect its security based upon the then international situation; against the potential strategic and economic benefits from an exchange of Atoms for Peace and Trust with India in this new century

Prime Minister Singh needs to do two things. President Bush needs to do one thing