[Joseph_E._Stiglitz,_Carl_E._Walsh]_Economics(Bookos.org) (1)

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INDIAN ENGINEERS IN SILICON VALLEY AND SILICON
VALLEY’S CAPITAL IN INDIA
Globalization and the increasing integration of the world economy
can allow both investment capital and workers to move
across borders, seeking more profitable opportunities. Nothing
better illustrates this interchange than the investment by venture
capitalists and U.S.-based firms in India’s Silicon Valley and
the immigration of high-tech workers from India to California’s
Silicon Valley. U.S. firms are investing in software design and
research facilities in India to take advantage of that country’s
well-trained computer workforce and lower wages. At the
same time, many engineers from India are moving to the United
States to find higher-paying employment.
During the 1990s, the rapid expansion of high-tech jobs
in places such as California’s Silicon Valley led to an increased
demand for engineers and others with the skills the computer
industry needed. To meet it, Congress expanded the H-1B
visa program that allows individuals with certain skills to
immigrate to the United States. While potential immigrants
can qualify for an H-1B visa in a wide range of occupations,
most often they have sought computer-related jobs. According
to the U.S. Immigration and Naturalization Service (now the
Bureau of Citizenship and Immigration Services), just under
half of the H-1B visas granted between October 1999 and
February 2000 were for occupations classified as in systems
analysis and programming. The next most common occupation
was in electrical and electronics engineering, accounting
for 5.4 percent of the visas. (Occupations in economics
ranked seventh on the list, making up 2.3 percent of the H-1B
visas.) Nearly 43 percent of all H-1B visas were granted to
individuals from India. Among other countries of origin,
China, representing fewer than 10 percent of H-1B visas, was
a distant second.
In 2000, Congress raised the number of H-1B visas that
could be issued each year from 115,000 to 195,000. The bill’s
passage by a vote in the Senate of ninety-six to one demonstrated
the broad political support that this program to bring
skilled workers to the United States enjoyed. This support
Fueled by an influx of American capital investment, successful high-tech firms like
Infosys are making Bangalore the Silicon Valley of India.
806 ∂ CHAPTER 36 DEVELOPMENT AND TRANSITION