Sharma to raise India’s concerns with USTR, Commerce Secretary

India will urge the US to drop its controversial Immigration Bill, which could lead to imposition of heavy penalties on Indian IT companies recruiting a majority of non-Americans in their US operations.

Commerce and Industry Minister Anand Sharma who is scheduled to meet US Trade Representative Michael Froman and US Commerce Secretary Penny Pritzker this week in Washington, will also defend India's intellectual property regime, which is facing heat from American businesses and lawyers.

“The new US Immigration Bill is a big threat to the viability of Indian IT companies in the US.

“It will top the Commerce Minister’s agenda for discussion with US policy makers,” a Commerce Ministry official told Business Line.

The Commerce Department has examined the Bill and found parts of it, especially portions related to minimum salary threshold, to be in violation of provisions of the World Trade Organisation.

“The entire Bill violates the WTO policy of non-discrimination, as it is Indian IT firms that would largely get affected.

“But it would involve a lot of work to prove it,” another official said.

The Immigration Bill proposes restricting a company with over 15 per cent of its workforce on H-1B visas (work visas) from placing H-1B workers at the offices of their clients.

Further, companies hiring more than half its workers on H-1B would be barred from applying for more visas from 2016 or pay a steep fee of $10,000 per visa.

Indian IT companies such as TCS, Infosys and Wipro that are likely to get immediately affected if the Bill becomes law, although the legislation does not directly impact Indian companies.

Defending IPR

Indian IT industry body Nasscom and the US-India Business Council are already lobbying in the US Congress to garner support against the Bill which, they say, would also hit the US economy, as a large number of Fortune 500 companies had also started adopting the Indian model of recruitment.

Sharma is also ready to defend India’s intellectual property regime and local sourcing norms that have been facing heavy criticism from US businesses and lawyer bodies.

The industry in the US, especially the pharma lobby, has been claiming that India’s IP regime had become more challenging after the Government issued a compulsory licence to a generic manufacturer for producing a cancer drug patented by German company Bayer at a fraction of the original price.

“India has been in strict compliance with global trade rules. We cannot be faulted on that. We have to ensure availability of cheap essential medicines for our people,” the official said.

Sharma, during his four-day visit beginning on Thursday, will also meet CEOs of top US companies in Washington, New York and Chicago.

amiti.sen@thehindu.co.in

(This article was published on July 7, 2013)
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