If the current economic situation were to get any worse, we could for the first time see mass migration back to India from US, UK and a few more advanced economies. What is the news here one might wonder, after all we have seen many desis go back home in trickles or in droves since the IT bubble burst and India started doing better for most part of the last decade. However, this time there are more reasons for this reverse migration, principally economic.
Most of the western economies are in dire straits. If you have been following my blog, i have tried and linked up a number of sources giving a clear picture of what is yet to come. The US is throwing as much money as it could print and/or borrow to fix the sinking economy, but all it is trying at this time is to keep the US economy afloat. What i am saying here is, US is trying to not lose the existing jobs. The question of creating new jobs is a whole new question. It needs fresh investment in newer fields. So, desi students graduating at this point is looking into a long dark tunnel. How soon they will see light is anybody's guess.
There aren't enough H1 visas available for all the desis who are already here and are graduating. Last year alone more than 94000 Indian students landed here for higher education. Even if we assume there will be a small percentage of students in that list who plan to go back immediately after graduation, a majority of them is in for a disappointing realization. With the new OPT rules and insufficient visas available, many would have to go back to India.
US consumption is weakest in decades and it is not going to turn around anytime soon. This had to happen sooner or later. How long can they borrow and spend? Having reached the end of their tether, they are cutting (willingly or otherwise) back on their expenditure. 70% of US GDP is based on consumption. As anyone can see, if the American consumer is cutting back, there is going to be a severe jolt (as we are seeing now) to the system. Having lost all their life savings (401K, home value etc.,) due to this credit crisis (coupled with a very expensive and penalizing healthcare system), they have finally come to their senses. Though the idea of 'Save and Invest' is great in the long run compared to the 'Borrow and Spend', this will lead to significant job losses atleast in the short run due to excess capacity. Thats because both the economy and industries are geared to satisfy the excess of American spending. Many fields including hitech on which many of us, desis, depend will not be in a position to employ the 1000s of graduates out of school, even if we assume that people who are employed won't lose their jobs. Just take a look at the number of chinese factories that are being closed because of cut backs in American spending to understand the impact.
Here is an article from From Financial Times about a trend that still might be nascent but will only grow.
The next few years will see many desis returning home, not because they want to, but because they have to. The picture of Indian IT industry, which is so one-dimensional is not a pretty either. With most of the advanced economies teetering, the Indian IT companies don't have many options to diversify. In this situation what is the best thing for us, especially in IT field, to do? Anyone with ideas?
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On a completely different topic, MUMBAI. Sad state of our society here.
Whatever your opinion about Arundathi Roy, this is a must read from her about mumbai. There are too many things that are true and relevant in there. Of course, there would be closeted bigots amongst us who want to see everything as 'us vs them' and want to sweep everything she has to say under the rug by tagging her as a bleeding heart liberal.
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