Ohio outsourcing ban: India furious, US placatory

India has conveyed its "serious concern" in a communication to the US over Ohio's ban on offshore outsourcing of government business and a hike in US visa fees for professionals, commerce and industry minister Anand Sharma said in Bangalore on Friday.

He added that the measures on outsourcing and the increase in fees for H-1B and L-1 visa were "regressive", and that India will raise the visa fee hike issue with the US administration at the upcoming joint trade policy forum meeting on 21 September in Washington. India has also decided to discuss the Ohio state ban on outsourcing of IT projects and US President Barack Obama's stand against offshoring.

Talking to reporters after the award ceremony of the Engineering Export Promotion Council, Sharma said India is examining whether there is any violation of the WTO agreement on services. "Every country has its own WTO commitments, we will have to examine if there is violation of Mode 3 and Mode 4 (clauses relating to free flow of services across borders)," he said.

"Though the Ohio ban on outsourcing is a state issue and Obama's observation on offshoring is sovereign issue, we are going to discuss at the forum because eventually outsourcing plays a major role," Sharma said.

Sharma, who would be co-chairing the trade policy forum along with US Trade Representative Ron Kirk, said, "We have already flagged this to the US ... we intend to place it on the table for discussion. I hope they will reflect and we will be able to find a meaningful solution."

He said in a globalised world, policy-makers and decision-makers must take a global view. Sharma's comments come a day after US President Barack Obama hit out at US companies outsourcing their work to offshore locations like India. At the same time, Ohio governor Ted Strickland has banned offshore outsourcing by government departments. Earlier, the US increased professional visa fees significantly to fund its $600 million programme to secure its border with Mexico.