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By Sarah Jacob, NDTV
November 02, 2008
Despite admitting in interviews in the past that globalization cannot be reversed and that America "cannot and should not put up walls around our economy", Democratic Presidential nominee Barack Obama has been hammering away at outsourcing on the campaign trail.
"When I am President I will give tax credits to companies that hire in the United States and end tax breaks for companies that ship US jobs overseas," he said at a rally.
In 2004, John Kerry, the democratic candidate for US President had stirred up passions in America by blaming the slump in the economy to outsourcing.
At various points in this year's campaign, Obama has appeared to do the same.
"This is an issue that the Obama campaign has engaged in really unfortunate demagoguery. With the world on a brink of a financial catastrophe, the last thing we need to do is to erect protectionist trade barriers. Senator McCain has been a strong and consistent advocate of free trade, which is exactly what the country needs right now," said Asheesh Agarwal, special counsel to the McCain campaign.
India's software and services exports stood at nearly $40 billion during financial year 2008, with the US as its largest market. And the experts say despite what Obama says on the campaign trail, protectionists measures that will hurt countries like India will be difficult to implement.
"There already has begun a backlash against outsourcing and so on. So, to some degree, we have to be conscious that more and more things will be done in America if they can be done in America. At the same time, when economic times are bad, it is difficult for companies and the government to spend more money on some thing that can be done cheaper in India. So it cuts both ways," said Shashi Tharoor, former UN Under Secretary-General.
Not many world leaders carry coins with Hanuman images or have a picture of Gandhi in their office but Obama has his desire to make a clean break with the Reagan-era philosophy of promoting free trade and international capital mobility, which every US president since has continued.
It certainly has the potential to hurt some of the fastest growing sectors of the Indian economy. But, as we Indians know well, there is a big difference between what one says to get elected and what one does when in office. It is a difference that Indian business will be hoping for in the months to come.
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