Tuesday, July 16, 2013

Made in USA

Obama may be carrying idol of Lord Hanuman and admirer of Mahatma Gandhi. But he is not a friend of India
In the recent US trip of Finance Minister P Chidambaram, his third in recent months, nobody expected any downpour of American FDI to end the unrelenting drought of dollars. Still, it was expected that there would be some concrete developments on thorny bilateral economic issues, be it drug patent, or the constant niggling by President Obama about an imaginary exodus of American jobs to Bangalore.
For that matter, many in India are anxious to know how the US will respond to the growing economic crisis in India, a nation which three successive American presidents have described as an “important ally”. A foreign reserve crisis is impending. India had short-term debt amounting to US $172 billion in end-March this year, which means it has to pay that much money to creditors on or before 31 March 2014. It will knock off two-thirds of the foreign reserve as of today. The bite may be even bigger if there is a new crisis, putting us back to the 1991 situation where there were just enough greenbacks to fund 15 days’ import.  Can a part of the short-term debt, mostly owed to American financiers, be rolled over? Or what?
Instead, what took place between the articulate Indian finance minister and a phalanx of American bureaucrats and businessmen was a dialogue between the deaf and the dumb. American investors of today seem no more generous than their British indigo-planter forebears two centuries ago. They’re livid because the Indian Supreme Court has thrown out the patent claim by Novartis, a pharmaceutical MNC with its headquarters in Basel, Switzerland, of Glivec, a leukaemia drug. After it had gone off patent, Novartis put the stuff in a pill and claimed it to be an innovation. The drug costs $75,000 a year in the US, and $31,000 in India. However, the court upheld Indian authorities’ decision that Novartis could not milk the drug any longer, and allowed generic drug-makers to market it—at a dream price of $2,100 a year.

It must have brought cheer to the pale and wan faces of the millions of cancer patients and their relatives in India. But the US drug-makers began a war as they immediately saw that the verdict would scupper their age-old practice of tweaking a drug molecule, or its delivery system, and putting it back on the shelf as fresh and new. “Evergreening”, as it is called, accounts for over a quarter of the big US pharmas’ revenues. Pfizer, the biggest drug company in the world, has taken the lead in this “war on India’s discriminatory pricing”. Before the recent visit of Secretary of State John Kerry to India, a bipartisan group of 180 US lawmakers wrote to him, and to President Obama, protesting against India’s “protectionism”.  Big-ticket retailers like Walmart are sore for variety of reasons and IT and Telecoms firms in the US are furious because India had decided to reserve 30 per cent of government contracts to companies having manufacturing bases in the country. However, protests from Cisco and such other biggies have forced India to put the “preferential treatment” clause in the cold storage. 
But don’t blame the irate American businessman alone, when it comes to India, it is President Obama who has a chip on his shoulder. It began pretty early when he, as a Senator, had pleaded with Bush, the then President, to insert a clause in the contentious US-India civil nuclear deal that would make it difficult for India to buy enriched uranium from the Nuclear Suppliers’ Group (NSG) without signing on the Non Proliferation Treaty. On being elected, his inaugural list of Asian partners included Pakistan, China, Afghanistan, South Korea and Japan, but not India. The first two dozen international leaders to receive a call from Obama after he assumed Presidency included Asif Ali Zardari, but not Dr Manmohan Singh. Even Secretary Hillary Clinton, in her inaugural hop-on hop-off trip to Asia, touched every capital except New Delhi.
The result is, India has dropped out of America’s investment horizon. On the other hand, in the name of reforming immigration, Obama took special care to introduce in the Immigration Bill, which has been passed by Senate and is awaiting consideration of the House of Representatives, a slew of clauses that would make things exceedingly difficult for India, such as:
·      H1B and L1 visas are priced too high, thus making it next to impossible for Indian IT firms like Infosys and TCS to send workers on specific projects to the US for a limited period;
·      Companies that get 30% or more H1B visa holders will have to pay new fees, a provision that makes it almost futile for companies to structure their business models based on sending teams to work onsite, or “body-shopping”, as the expression goes;
·      In jobs, preference will be given to students educated in the US, a clause that will create a “gold rush” for Indian students to enroll in American colleges—a hugely expensive future national passion; and,
·      Strict restrictions to be put on relatives entitled to migrate.
Obama reportedly carries an idol of Lord Hanuman and admires Mahatma Gandhi. But he greatly dislikes their country. He is currently breaking bread with the notorious Taliban, and has helped them set up a spanking ‘international’ office at Doha. True to their style, the day the Doha office was opened, the Taliban launched a rocket attack on an American military base in Afghanistan, killing four US soldiers. It shows the utter stupidity of Obama’s policy to play the ‘Afghanistan endgame’ by talking to an unreformed Taliban before its planned exit from the country in 2014. It leaves India frightfully insecure, with militant Islamic fundamentalism poised to recapture its west to a depth of 1,500 miles, not to speak of a powerful and cantankerous neighbor in the north. No wonder India is committing its last shirt to buy arms.

An imperialist, like Winston Churchill, was churlish with India because he thought the country could not rule itself. Unfortunately, Obama, the first black US President, hates India not as a superior but like equals who hate each other.
(The author is the National Editor of Lokmat group)