In face of globalisation, US turns protectionist
ONLY IN AMERICA / CHIDANAND RAJGHATTA
timesofindia.indiatimes.com
TIMES NEWS NETWORK [ SUNDAY, JANUARY 19, 2003 03:19:57 AM ]
It wasn't too long ago that a shudder of fear ran through the Indian spine over the prospect of foreign companies overrunning the domestic market. Farm lobbies worried about foreign produce (remember California almonds and New Zealand apples), local manufacturers worried about foreign goods (Chinese locks and bicycles, Korean electronics), and labour unions worried about local jobs. Globalisation was a fearsome word.
Some of the worries persist, but it appears India is also beginning to appreciate the opportunities that globalisation is offering. Just as India was fearful of foreign imports, and turned protectionist at the slightest sign of being swamped, so too the US, where the atmosphere in the first decade of 21st century resembles what India went through in the nervous 1990s.
Nothing better illustrates what free trade is doing to the US than the story of the hoary Bethlehem Steel, a saga that would have found a lot of sympathy and resonance in India's rust belt in the yesteryear, except that it is precisely the same rust belt, now in a shiny revitalised avatar, which is bringing the US giant to its knees.
At the height of its glory, Bethlehem Steel was one of the world's great corporations. It employed more than 300,000 people and shipped nearly 25 million tons of steel a year.
The behemoth began producing steel before the Civil War and its output was used in the first railroad tracks and the first skyscrapers (it still supports the Golden Gate Bridge.) During World War II, it built America's first aircraft carrier and assembled more than 1,200 ships for the Navy.
But the glory days are over. By the early 1980s, Bethlehem first began to feel the heat from smart new Korean and Japanese companies which did more for less, and more with less. That was at a time when Indian companies were considered even more sloppy and slothful than the American giants.
In the two decades since, there has been a complete turnaround. The word now in the
US steel market is the Tatas and the Mittals run the sharpest operations around.
With an ageing workforce, expensive pension obligations and massive healthcare payouts,
US companies have been routed. Bethlehem Steel itself filed for bankruptcy in 2001.
The story is now being repeated in many other sectors as Indians gain in confidence.
Indian companies are now learning to challenge and overturn US protectionism in both
American and international courts, as Dr Reddy's did with Pfizer in a New Jersey court
and the steel lobby did at WTO. And this is just the beginning, although it needs to be
stressed that you win some and you lose some.
Americans meantime are now beginning to whine about Indian textiles,
Indian pharmaceuticals, Indian diamonds and jewellery, and Indian everything.
The story is beginning to shift from services to goods and manufacturing,
even as a raging debate has broken out about the former.
One the one hand, the US wants to reduce and cap the number of skilled
professionals from foreign countries like India. On the other hand, the US
does not want its jobs to go out to foreign
countries like India where it can be done cheaper, quicker and better.
Who would think that a decade ago it was the US which was
forcing globalisation down India's throat and India was seen as
the patron saint of protectionism? |
