The Hindu : U.S. ban on outsourcing a wrong signal: Jaitley

Online edition of India's National Newspaper
Thursday, Jan 29, 2004

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U.S. ban on outsourcing a wrong signal: Jaitley

By Our Special Correspondent

NEW DELHI, JAN. 28. India will convey its reaction, at an "appropriate occasion", to the U.S over the recent law banning outsourcing abroad of Government contracts. Stating this here today, the Commerce and Industry Minister, Arun Jaitley, said: "This step sends a very wrong signal especially as far as multilateral talks are concerned."

Pointing out that the U.S. had traditionally been a strong proponent of market access, he said in contrast it was now trying to close a market which had always been open. He stressed that it could not seek to open markets in other countries while at the same time indulging in market denial. "We will certainly be conveying our reaction at an appropriate moment to the U.S. on this issue," he said. This was despite the fact that the actual loss to Indian companies on account of this legislation was not significant.

In June last, he had raised the issue of the U.S. considering legislation banning outsourcing of Government contracts outside the U.S. with the U.S. Trade Representative, Robert Zoellick. At the time, he said Mr. Zoellick described the proposed law as "bad policy." It thus came as a surprise to him that what was then considered a bad policy was now being promoted as a law by the Federal Government itself.

He was speaking at the function organised by the Federation of Indian Export Organisations to launch the digital signature and electronic fund transfer facility for exporters.

To encourage electronic filing of applications by the exporting community, the licence fee had been reduced to 50 per cent in cases where online digitally signed applications with electronic fund transfer were submitted on its website.

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