Don’t Forget India

The world’s second-most populous nation is pumping out highly skilled workers at a record pace.
From the April 2006 Trumpet Print Edition

Focused on the rapid rise of China, many people are not as aware of the threat being posed by a nation just to its west: India.

India, in many ways, should concern Americans and Europeans even more than China should. Like China, the nation teems with cheap labor, but it also has a workforce that is highly educated, very efficient and very willing to work. India now produces more than 3 million college graduates a year, compared to 1.3 million in the United States and 2.9 million in all of Europe.

India’s skilled workforce is gaining a foothold in a number of booming sectors across the world, including technological development, software development, engineering, medical science, accounting, call-center operation and the list goes on. An increasing number of American and European companies are realizing that for a fraction of the cost they can farm out much of their work to India. An American tech company, for example, employs an American computer programmer for $80,000 a year, but could hire an individual with the same qualifications and competency in India for only $11,000 a year.

Thanks to this highly skilled, dirt-cheap labor force, India is on its way to dominating critical sectors of the global economy. Take software development, for example. “In 2000, Indian software exports were about $6 billion. By the end of 2004, they were estimated to have hit $16 billion. The big accounting and consulting firm Deloitte forecast last year that within five years, the world’s largest financial firms will have shifted $356 billion and 2 million jobs offshore, mostly to India” (Clyde Prestowitz, Three Billion New Capitalists). Even your taxes could be done in India this year. In 2004, 25,000 American tax returns were prepared by graduate accountants in India. The following year, that number multiplied eightfold, to 200,000.

For around a quarter the cost of a call-center employee in America, a company can employ an Indian college graduate to answer phones in Islamabad. And the salary for the Indian employee is a good one; in many cases it includes insurance and medical benefits for the individual and his or her family. When call-center jobs arise, literally hundreds of applicants, including many college graduates, seek to fill each vacancy.

GE, for example, employs more than 15,000 Indians in its call center and back-office processing operations. It also has one of the largest research and development centers in Bangalore, employing several thousand highly educated scientists and engineers who work on the cutting edge of GE developments.

As Prestowitz stated, “[T]his combination of skills, low cost, quality work and instant communication means that few aspects of your life will remain untouched by the outsourcing of services to India. You may not be aware of it, but whether it is your yellow pages, the interactive websites of companies like Boeing or Morgan Stanley, or the report on the X-rays you had yesterday, the skilled hands and brains of Indians are present.” This new availability of a highly skilled, hard-working Indian workforce is revamping entire sectors of the world’s largest economies!

The United States is encouraging and augmenting India’s rise both because New Delhi is critical to Washington’s security policy in the region, and also to provide a counterweight to the rise of China both economically and militarily. President George W. Bush sought to strengthen ties with India on a recent visit to New Delhi.

But is India a reliable ally? When push comes to shove, will it support America, or side with its Asian neighbor?

Rapprochement between traditional enemies China and India, in fact, has already begun. China and India established an economic cooperation partnership last year intended to facilitate an increase in trade from the current $13 billion to $20 billion within two years. The two countries have concluded a declaration of intent to increase cross-border businesses and transport networks. Cooperation, they have declared, should also be strengthened “in the development and use of oil and gas resources in third countries.” They are even talking about creating, in the words of Spiegel Online, “a joint Sino-Indian common market based on the European model. If that effort ever prevailed, it would result in the world’s largest economic unit, with around 2.5 billion consumers, one third of the world’s population” (March 6).

Ironically, it is likely America’s overtures to India that will spur China to forge a closer alliance with India to counter U.S. advances.

Bible prophecy shows the outcome: Asia will align both politically and militarily, and the U.S. will be shut out. In the end, the rising star of India will go the Asian route.