Wipro, Cognizant lobbying US to ease visa rules

[snathan]

Wipro, Cognizant lobbying US to ease visa rules - The Economic Times


BANGALORE: Lobbying has been a taboo for India's wildly successful software companies: that distasteful activity was supposed to be the preserve of those looking to prosper from the licence permit raj. And anyway, their markets were mostly overseas.

But now, in the home of free market capitalism, as their encounters with disguised protectionism grow more frequent, the 'L' word does not appear so dirty any more. That is why, while America keeps inventing reasons to make it harder for them to do business, many Indian software companies are spending large sums hiring professional help to win friends and influence people in their biggest market.

At stake is over $30 billion (Rs 1.3 lakh crore) in business every year, about half of India's total outsourcing revenue. Among the companies mounting an aggressive PR effort is Wipro, India's third-largest software exporter. Last year, it hired Melanie Carter-Maguire, a government relations professional, to launch its lobbying effort in Washington DC.

Between January and March this year, Wipro spent nearly $60,000 (Rs 27 lakh) to lobby lawmakers and other officials about restrictive visa rules and policies that favour local companies. Cognizant , which is headquartered in the US but employs over 80% of its staff in India, spent $350,000 during the first quarter this year. Two years ago, it hired Robert Hoffman, a Capitol Hill regular, to lead its lobbying efforts.

"Engaging with policymakers and local communities through lobbyists and PR professionals was long considered a taboo. Now, some senior managers, especially those based there, are questioning that stance and asking us to step up," said the CEO of a tech firm.

Direct & Indirect Attacks

As America struggles with anaemic growth and stubbornly high unemployment, the campaign for the presidential election next year is well underway. With many citizens still associating unemployment with outsourcing firms, rhetoric is being combined with direct and indirect attacks on the business interests of Indian software companies.



Infosys, which relies on software industry grouping Nasscom and does not engage lobbyists, is caught up in a lawsuit which alleges that the company misused visas. Visa fees have been doubled to fund border security along Mexico. Indian workers seeking short-term postings in the US are being denied visas. And in June, a Congresswoman proposed a bill that would increase wages paid to H-1B workers so that American candidates don't lose out.

"It's staring at us just when we have achieved a critical mass in the global outsourcing market - we cannot ignore it anymore," said the CEO at one of the top Indian tech firms who requested anonymity because he did not want to upset his customers and others in the US. "Lobbying is considered a bad practice in India, but in the US it's a sophisticated way of creating awareness among stakeholders, including lawmakers," he added.

Reforms in corporate taxes, visa rules and patent regulations are also on the agenda of the lobbyists employed by Indian companies. Prominent among them are Barbour Griffith & Rogers, The Cohen Group and Hill & Knowlton, who work for TCS , HCL and Patni Computer Systems , respectively, to reach out to lawmakers about the benefits of outsourcing and the need for a broader immigration reform in the US. All three firms did not reply to emails from ET seeking comments for this story. "Beyond a point, you can't do much about rhetoric. The danger is when it starts showing up in regulations and customers start asking uncomfortable questions," the top executive at another of India's biggest software companies said.

"We have to learn to engage better in the US, and unlearn the hangover that we are Indian firms," he added. For long, Nasscom engaged with US lawmakers and other authorities on issues of immigration. But now, with companies like Tata Consultancy Services reaching $8 billion in revenues, there is a need for these firms to lobby on their own.

"They (individual companies) need to strategise about their corporate affairs and engage with local senators and communities," said Som Mittal, president of Nasscom. "Multinationals in India too have dedicated corporate and government affairs officials," he added. Indian tech firms are not alone in trying to explain why broader immigration reforms are needed for America, top US software companies in-Recluding Microsoft , Google, HP and IBM lead the lobbying efforts on these issues.

Partha Iyengar, the head of research at Gartner in India, said the software services industry has become big enough and too visible, and therefore an easy whipping boy. "The Indian companies, exactly because of their visibility and the strong growth they have exhibited are easier and 'better' targets than the US companies overall.

However, it is actually the lobbying by the US companies (who are more likely to get a stronger hearing from US lawmakers) that prevents silly laws from being passed that would actually hurt US competitiveness in the short and long term," he said. Cognizant, which counts JPMorgan among its top customers, spent $350,000 during the first three months of this year lobbying for repatriation of foreign earnings, among other issues. It also lobbied to 'educate' members of the Congress about the impact of visa fee increases and spent around $60,000 during October to December, 2010.

Companies such as Wipro intensify lobbying for specific proposals and regulations as and when they arise. For instance, during the fourth quarter ending December of 2010, Wipro spent $66,000 lobbying with the US lawmakers on policies that hurt off shoring. Infosys, regarded as a model of good corporate governance in India, has become a favourite target in the US. Norman S Matloff, who teaches computer science at the University of California, said people such as Senator Charles Schumer are unfairly scape-goating the Indian outsourcing firms, especially Infosys.

[ronhira]

too little too late.... lobbying will help good issues, the right issues..... it may even help delay but will not prevent the inevitable.... these cos have exploited the loop holes for far too long.... time for these cos to play on level plain field with the market instead employing their competitive advantage as the ability to exploit employees.....

[ek_bechara]

Originally Posted by ronhira

too little too late.... lobbying will help good issues, the right issues..... it may even help delay but will not prevent the inevitable.... these cos have exploited the loop holes for far too long.... time for these cos to play on level plain field with the market instead employing their competitive advantage as the ability to exploit employees.....

Kudos to the Murthys and Premjis of India for ushering the technology revolution but there is no free pass when it comes to exploiting another nation's immigration and labor laws. The sad part is that these companies still have "chalta hai" attitude. Enough is enough. I have waited close to a decade, got two advanced major degrees in technology and business, paid taxes for eons and am patiently waiting for a LONG time. I'm not allowing a Senior Java Developer from India with three years of pure coding experience to masquerade himself/herself as a Senior Executive and get into the EB-1 line. F-that...

[snathan]

Originally Posted by ek_bechara

Kudos to the Murthys and Premjis of India for ushering the technology revolution but there is no free pass when it comes to exploiting another nation's immigration and labor laws. The sad part is that these companies still have "chalta hai" attitude. Enough is enough. I have waited close to a decade, got two advanced major degrees in technology and business, paid taxes for eons and am patiently waiting for a LONG time. I'm not allowing a Senior Java Developer from India with three years of pure coding experience to masquerade himself/herself as a Senior Executive and get into the EB-1 line. F-that...

Can you elaborate on this...you should allow him to file for EB1 and then file a complaint. So he will learn what the law means....

It will be a deterrent for others too.

[shivarajan]

They have more moolah for lobbying and happens all the time (More than what meets to eye?)

Isn't consulting their bread-n-butter?

Won't be surprised if they are million times more powerful than naive immigrant community who can only rant in forums.

[snathan]

Originally Posted by shivarajan

They have more moolah for lobbying and happens all the time (More than what meets to eye?)

Isn't consulting their bread-n-butter?

Won't be surprised if they are million times more powerful than naive immigrant community who can only rant in forums.

So you forgot the anti immigrants and NumberUSA.