Indian cos to take up data protection issues with US
9 Jul 2007, 0015 hrs IST,Shalini Singh,TNN

NEW DELHI: Some of India's largest companies in the ICT space, especially the IT and BPO sectors are headed to the US to participate in the Indo-US ICT dialogue to be held in Washington from 11th to 13th July.

The three main issues that they hope to take on relate to data protection regulations, visa related barriers and social security taxes which burden their employees.

Major Indian companies that will lead the dialogue from the Indian industry apart from CII include TCS, HCL, Satyam Computers Ltd, VSNL International, ITC Infotech and State Bank of India. The telecom sector is represented by COAI.

These companies believe that the anti-outsourcing movement in the US is politically sensitive and the increasing numbers of anti-outsourcing bills have created an uncertain business environment. The fact that the presidential election race has just begun has made things worse for the outsourcing debate. In fact, presidential candidate Barack Obama attacked Hilary Clinton and then apologized on a related matter just recently.

Some anti-outsourcing bills have raised the issue of data protection. India does not have a data protection law similar to that in US. Indian businesses say some of their US clients have raised concerns about data protection and consumer privacy before outsourcing to India. Since there are no certifying agencies in India, they have to obtain the requisite security certification from US agencies which is both time consuming and expensive.

Another key issue pertains to visa-related barriers. ITES/BPO firms have to often send their employees to US. Most people are sent on a B1 (business visitor) visa. Some are sent on L1 (intra-corporate transferees) or H1B visas.

In the case of B1 visas, as per the rule, the employee has to be employed for a minimum period of three months before applying for a visa. This is seen as a barrier for companies. Individuals traveling on B1 visas find it difficult to extend the period of stay beyond six months. Indian businesses also feel that the application process is lengthy and cumbersome. Independent BPOs point out that the delay in visa processing affects their on-time delivery of projects.

The visa issue has recently taken serious political overtones with commerce minister, Kamal Nath issuing caution to the US government in this regard.

US Regulation, domestic regulation and government procurement processes are other barriers for the India IT sector. Some US state licensing authorities give preference to specific professional degrees from certain countries. There are no clear guidelines on the procedure. Non-recognition of qualification in certain professions such as accountancy, legal and health restricts companies from providing such services on the Internet.

Lastly Indian companies argue that since we do not have a Totalisation Agreement with the US, their employees in the US have to pay social security taxes in both countries. Employees traveling on H1B or L1 visas also pay social security taxes.

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