Says move a setback for firms wanting to set up shop here
The US Government has objected to India’s plans of making it compulsory for Government agencies to source electronic products, including personal computers, printers and tablets, from domestic manufacturers.
It has also expressed “grave concerns” about private companies being mandated to domestically source IT products in some instances due to security reasons.
“The US may give a non-paper to India listing out its concerns and how those might be addressed,” an Indian Government official told Business Line.
The US Under Secretary of State for Economic Growth, Environment and Energy Robert Hormats, in his recent interaction with Commerce and Industry Minister Anand Sharma, argued that the domestic sourcing regulations would be a huge setback for US IT companies that want to set up shop in India, the official, who also attended the meeting, said.
Since the domestic sourcing regulations would force some companies to let go of their global supply chains that they have developed over the years, steps needed to be taken to address this area of grave concern, the US official stressed.
Notification
The Ministry of Communications and IT, last Thursday, put out a notification making it mandatory to give preference to domestically manufactured laptop PCs and tablet PCs in Government procurement.
Notifications were issued in December for providing preference to domestically manufactured desktop PCs and dot-matrix printers in Government procurement. The time-line prescribed for adhering to the notifications, in most cases, is March 2014.
The proposed rules are meant to help develop a robust Indian technology manufacturing sector, the Indian Government said in a recent statement.
Wherever domestic sourcing restrictions have been placed on private companies, the Government has cited security concerns as the deciding factor.
“The Commerce Minister, too, explained to the US Under Secretary that the move is required to boost domestic manufacturers that were still struggling to grow,” the official said.
Technology hardware exporters based in the US and the EU have already written to the Government deploring the move, especially because it would not just apply to Government agencies but also private companies in some instances. Some have indicated that it could violate World Trade Organisation norms.
‘No norms breached’
Indian Government officials, however, are confident that no international norms are being breached. “India is not part of the Government Procurement Agreement of the WTO and thus is free to impose any procurement conditions on government agencies. The WTO also allows countries to impose sourcing restrictions for security reasons,” another official, who deals with WTO issues, said.
Keywords: US Government, objection, India’s plans, compulsory, Government agencies, electronic products, including personal computers, printers and tablets, domestic manufacturers.
Comments:
bravo, finally some steps are being taken by the govt to protect indian industry, is
this only a plan or is it being implemented,
Millions of. Comindians buy mobile phones, the average life of the mobile phones are
only 2yrs, while i believe india should have access to the latest availble models, i
beleive that the basic phone which allows phoning and sms can be manufactured in
india and the basic imported ones may be taxed, such that a local industry can also
be developed, not an import and assemble, like whats happening in the car industry.
My reasoning being as an india i use my tv, refridgerator, suitcase for 15 years, why
not my telephone? Why should i use a chinese manufactured phone which gets
condemned in 2years,
We will also not be contaminating mother earth.
bravo, finally some steps are being taken by the govt to protect indian industry, is
this only a plan or is it being implemented,
Millions of indians buy mobile phones, the average life of the mobile phones are only
2yrs, while i believe india should have access to the latest availble models, i beleive
that the basic phone which allows phoning and sms can be manufactured in india
and the basic imported ones may be taxed, such that a local industry can also be
developed, not an import and assemble, like whats happening in the car industry.
My reasoning being as an indian i use my tv, refridgerator, suitcase for 15 years, why
not my telephone? Why should i use a chinese manufactured phone which gets
condemned in 2years,
We will also not be contaminating mother earth.
I am thinking, was it like this in the times of Robert Ciive of East
India Company telling us what to do when and where ? Seems like we have
lost the freedom for which many youth both men and women who gave up
their blossoming lives for the casue of freedom. This conversation of
the Under Secy of State and our Minister recapitualates the existence
and extinction of Dacca muslin.
US stand is not acceptable to India. Our govt. has taken the right
stand. What US seks is protectionismj for its own and liberalisation for
oehrs abroad. In other words economic colonialism
Very good initiation.
This will also help to create some jobs locally. We must implement this ASAP and impose tax when non-Govt Org import directly from company who does not have presence in India.
Make every Hardware seller must and should have presence in India. This will improve the job market in India as it is raising and the H/W & electronic business is going to increase in many folds.
Raise India
US has no right to impose its will on India. BTW, most "American"
branded computers are made in China. Perhaps the US is concerned that
American companies cannot make a killing by supplying Chinese made
American computers at exorbitant prices to India. US practices a
different democracy to the one it preaches.
Good move by indian govt. US should practice what it preaches.
Finally we see some good steps by Indian Government. Always we heard
Obama says this about IT and Obama says that about IT. Now, India is
saying something.
Almost 90% of engineering grads in India now depends on IT. If we
could be self-sufficient with the domestic IT requirement then it will
not only creates JOB security for our people but also it will open
path for different technology like nano technology and other advance
research for technology.
Finally India can able to see it's own people in different technology
innovation.
Well..It's a good move from Indian Government.They should follow the
similar trend in each and every sector of socio-economic growth.If we
really want to become a developed nation,it is must to become self-
dependent in all trades.Sometimes it may seem good to source things from
foreign developers but in a long run for a secure future "self-reliance"
is something should be kept in front-row for the things which we have.
India is great and we can do all good stuffs ourselves.
Good step
and I fully agree with the comment of Mr.D Venkatramana
US puts restrictions on buying tele-communication equipment from chinese companies. It gave a re-fuelling contract to Airbus in a bidding process, then cancelled it, changed the sourcing requirements to suit Boeing and finally handed over the contract to Boeing. US fined BP more than 10billion dollars for Oil spill where there was little damage but doesn't want to US companies to pay for Nuclear Disaster in India. So it is for india to decide now
Mahatma Gandhi always practiced and pritched swadeshi, and was spinning his own cotton.Gov of India must support local industries, and should establish standers that Indian products could compete with the best products in the world markets.US cannot dictate India. India must not succumb to ANY us pressures. India is a FREE nation and NOT a colony.
Well lets stop outsourcing the software development and all maintenance
to india from US. Train local americans or indian americans asians who
are looking for job in USA. Let them(indian manufacturers) sell the
printers and other IT producs locally to the empty offices in india.
Where there is a need for printer if there are no IT jobs in india. Dont
indian government think before imposing such law?
President Bush during his India visit and specifically when addressing the gathering at IBS Hyderabad noted that the Nuclear deal is to protect/boost the related US industry and help the overall economy; he didn't even beat around the bush and tried to give some India pleasing sound bytes... lesson: self help is the best help! and US does that everyday / every minute .. be it H1 visas or any other trade policy... nothing wrong with Indian Govt. decision provided they do it strategically across all industries and wider foreign policy rather than a tactical move in a small isolated area
Many foreign companies hire bright Indian graduates from IIMs and IITs. With stagnating economies in developed world, it will be wise for fully owned Indian companies and government to hire brilliant Indians who have shown good research work and experience in cutting age technology at handsome compensation to make India leader in high tech products. Many Indian college graduates will be willing to come home with reducing research funding in developed world and resulting career uncertainties there. While local sourcing is a good decision, this is a good opportunity to come out with cutting age technology products at a lower cost in India.
Whether it is China , USA, UK or any other country, the security concerns are the same about embedded spyware to compromise our national security. This can never be given up ,however mighty the complaint country is. After all , the primary intention of these nations is simply in having full access to our security intelligence. There is no need for the Ministry for Communications & IT to be apologetic in this regard. Say it firmly and implement it with vigour .
US has no right to dictate terms to any country including India. We will decide what to do with our laws and economy.
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