A stiff learning curve

Posted in India | 14-Feb-06 | Author: Siddharth Srivastava| Source: Asia Times

Siddharth Srivastava is WSN Editor India.
NEW DELHI - Recently, US President George W Bush has invoked India and China three times. Unusual for the leader of the most powerful country in the world, though Bush is slated to visit India early next month. However, the theme of Bush's utterances had nothing to do with his India visit or the current subjects of discussions related to Indo-US relations - the nuclear deal and Iran. It was to do with competition.

Starting with his State of the Union address on January 31, Bush touched on the theme of competition three times in four days, mentioning India and China. Bush's dual aim appears to be to convince the US population of his intentions to raise math and science education levels to meet the needs of a more competitive global economy, without people feeling anxious about the move.

Bush said he wanted Americans not to be "complacent" in the face of "uncertainty" due to competition from India and China. At the same time, Bush has echoed business sentiments about the need to invite foreign workers to plug the shortage of skilled manpower in the United States. Two of his speeches were made from business platforms.

Observers in India have compared the Bush speeches to America's "Sputnik moment" of the Cold War, when the Soviet Union launched the world's first satellite into space. By sowing fear of a more powerful enemy, Washington justified money being pumped into science and space research that led to the US developing into the most powerful player in the field.

Circa 2006, Bush has invoked China and India to launch the American Competitiveness Initiative that will direct US$136 billion into science research, besides ramping up science and math education.

On January 31, Bush called for training 70,000 math and science teachers to improve US competitiveness, and said that the United States must break its reliance on Middle East oil.

"The American economy is pre-eminent but we cannot afford to be complacent ... in a dynamic world economy, we are seeing new competitors like China and India. This creates uncertainty, which makes it easier to feed people's fears. And so we are seeing some old temptations return," Bush said.

"Yes, we've got a lot of competition, and people begin to see an emerging China and India, and that makes people uncertain. It creates certain anxiety when they hear the stories about India and China beginning to grow robustly, or jobs going to India and China, or India and China consuming a lot of natural resources," Bush followed up at a speech on US competitiveness at the Intel headquarters in Rio Rancho, New Mexico.

A day before, at a speech at 3M's corporate headquarters in Maplewood, Minnesota, Bush said, "There are more high-tech jobs in America today than people available to fill them. The American citizen has got to understand it's important, if we don't do something about how to fill those high-tech jobs here, they'll go somewhere else where somebody can do the job."

The way out, he said, is for Congress to increase the H1-B quota, the temporary visas offered to skilled workers that has been capped. The most effective way to deal with the shortfall, Bush said, "is to recognize that there's a lot of bright engineers and chemists and physicists from other lands that are either educated here, or received an education elsewhere but want to work here. And they come here under a program called H1-B visas. And the problem is that Congress has limited the number of H1-B visas that can come and apply for a job - a H1-B visa holder can apply for a job at 3M.

"I think it's a mistake not to encourage more really bright folks who can fill the jobs that are having trouble being filled here in America - to limit their number. And so I call upon Congress to be realistic and reasonable and raise that cap."

Indian high-tech firms and US businesses have complained bitterly about the shortage of temporary visas to skilled workers. The full year's quota of H1-B visas has been slashed to 65,000, because of protests by American workers alarmed over losing jobs, down from the 195,000 quota in 2000, when the anti-outsourcing clamor had not caught on in the US.

Indian professionals garner more than 50% of H1-B visas issued by the US. Several high-profile US companies, such as Microsoft and Hewlett-Packard, have been lobbying Congress to increase the H1-B quota, pointing to worker shortages in specialty areas, despite opposition from US labor groups.

Reacting to Bush's speeches, The Times of India's foreign editor, Chidanand Rajghatta, feels that "the threat of China and India as economic adversaries seems overblown". He said that by every yardstick, PhDs, inventions, patents and research spending, the US remains the leader by far.

Statistics about the growth of China and India ignore the low base. For example, though the numbers of patents filed in the US from India is up by 2,000% over the past decade, it went up from 70 to 1,300. Americans, meanwhile, file 200,000 patents annually. Similarly, US fears about the large number of engineering graduates from China and India hides the vast qualitative difference in manpower. A US graduate cannot be compared to someone who has purchased a degree from a college in India.

Nobody doubts that outsourcing is here to stay, given the backing of business and industry worldwide. Estimates suggest that only 200,000-400,000 jobs have moved from the US since the outsourcing trend began in the 1990s, which is still a fraction of the 138 million jobs in the US.

The Information Technology Association of America says only about 2% of the 10 million computer-related jobs have been sent abroad. However, the jobs will move out at a higher pace. According to consultancy firm Forrester Research, 3.4 million US service-sector jobs are expected to move overseas by 2015. Observers say that one-ninth of the world's service jobs can be done from anywhere.

Chidanand said: "Sure, it's true that fewer American students are taking to math and science. It's smart on the part of American leaders to blow the whistle on this. You don't remain No 1 by being complacent. But Asians are picking up the slack, both children of new immigrants and second-generation kids. So as long as the US remains open to immigrant talent and nurtures its melting pot, there's little to fear. Given the growing interdependencies in the world, it's likely that India and China will be allies of the US, rather than adversaries."

Senior US officials have also clarified that Bush's reference to India and China was about leadership and taking on emerging challenges and not "threats" in the literal sense of the word.

"We think that it's important for the people of China and India to have improved standards of living," John Marburger of the Office of Science and Technology at the White House was reported as saying. "We want them to be able to make products for their own society to consume, and we want to be part of that market, too. So this is not about going up against China and India. This is about leading the world with models and productivity that keep our society strong.

"We're not responding to a threat; we're maintaining a leadership role. I believe the strength of this nation is such that all other countries are trying do it the way we do it, and the only way that we can maintain our leadership role is to do it better," he said.

However, it does appear that the US is likely to differentiate between India and China when it relates to military threat. The latest Pentagon quadrennial Defense Review Report says, "India is emerging as a great power and key strategic partner [to the US]. Shared values as long-standing, multi-ethnic democracies provide the foundation for continued and increased strategic cooperation and represent an important opportunity for our two countries."

But the Pentagon made it clear that of the major and emerging powers "China has the greatest potential to compete militarily with the United States and field disruptive military technologies that could over time offset traditional US military advantages and counter strategies".

Siddharth Srivastava is a New Delhi-based journalist.

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