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Barack Obama talks tough on outsourcing jobs at State of Union address

While he did not name India in his tirade against outsourcing, Obama announced the creation of a trade enforcement unit to investigate "unfair trade practices in countries like China".

IANS        Last Updated: January 26, 2012  | 11:31 IST

Saying that 'no challenge is more urgent' than keeping the American dream alive, President Barack Obama virtually launched his re-election campaign hitting out at "outsourcing" with a call to bring "manufacturing jobs back" to America.

Declaring that "the state of our union is getting stronger", Obama in his third State of the Union address to a joint sitting of Congress on Tuesday pledged to fight obstruction by opposition Republicans saying America had come too far in its still sluggish recovery from economic recession "to turn back now".

Obama, who launches a three-day swing through five key election states on Wednesday offered both his administration's priorities for the coming year and his campaign message for his re-election bid in November.

While he did not name India in his tirade against outsourcing, Obama announced the creation of a trade enforcement unit to investigate "unfair trade practices in countries like China", where a large number of American goods are made.

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"No, we will not go back to an economy weakened by outsourcing, bad debt and phony financial profits," Obama said as he defended a long list of his trademark policies - tax increases on the wealthy, Wall Street reform, healthcare reform and government stimulus spending.

Describing the possibilities offered by what he called a "blueprint for an economy that's built to last," Obama said, "Think about the America within our reach... a country that leads the world in educating its people." He called for lowering corporate taxes and providing incentives for US manufacturers to bring overseas jobs back to the US, while ending tax breaks for businesses that continue to outsource.


Ayan Pramanik

While US President Barack Obama hit out at outsourcing of jobs, Indian infotech firms have already increased their local hiring in the US and Europe due to a dearth of visas for their staff.

According to S. D. Shibulal, CEO and MD, Infosys, the firm has been hiring more talent locally in the US and Europe and is in the process of localising the talent pool due to the huge decline in visa issuance.

According to the latest figures from the State Department, the number of L-1 visas approved for Indian professionals by the US went down from 35,896 in fiscal 2010 to 25,898 in FY 2011. However, the L-1 visas issued to the rest of the world rose by 15 per cent.

"We are increasing local hiring. Our objective is to build a strong cadre of local people — whether it be in Europe, the US or Latin America," said Azim Premji, chairman, Wipro, last week.

Mohandas Pai, former member of the Board of directors of Infosys dismissed Obama's anti-outsourcing speech as political rhetoric. "This is nothing but just election rhetoric. I don't think there is need to read more into it," he said.

Courtesy: Mail Today
At the same time, he said, every multinational firm should pay a basic minimum tax while giving American manufacturers a tax cut.

"It's time to stop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America," Obama said, adding a line that he repeated throughout the speech in a challenge to Congress.

"Send me these tax reforms, and I'll sign them right away." With unemployment still above eight per cent amid sluggish economic recovery, Obama framed the challenges facing the country as a choice between opportunity for some or giving everyone a chance to prosper.

The Republican response chided Obama for not addressing the nation's $ 15 trillion debt more forcefully, presenting a contrast in policy proposals and outlook to the President's more optimistic assessment of what has been accomplished and what is needed.

"It was irresponsible for him not to recognise the dire circumstances our country is in because of our debt," conservative Senator Jim DeMint said.

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