A front page report in The Times of India talks about three American entrepreneurs who plan to house an international crew of software developers on a ship just off the California coast. This way, say promoters of the company called Sea Code, U.S. jobs will stay close home, foreign workers will be saved immigration hassles, and U.S. firms will get competitive rates for projects. Sea Code will be registered in the Bahamas, not subject to U.S. labor laws. The trio has already identified a $10 million ship called the Carousel for their experiment.

The promoters, San Diego techies David Cook and Roger Green backed by investor Barry Shillito, a former assistant secretary of defense, say they will hire around 600 programmers from all over the world — including the U.S. and India. “With hybrid-sourcing Sea Code brings already-off shored jobs back to the U.S. and assures that 90 cents of every dollar from our clients stays in the U.S. instead of flowing to foreign locations,??? a company press release said. Cook, a former sailor-turned-techie, said he expects the venture to sail smoothly, adding: “We’re not a slave ship.??? His partner Green says it will be more “like the International Space Ram Station.???

Well, it remains to be seen whether the trio pull it off, but their attempt surely is a reflection (even if slightly bizarre) of the U.S. industry feeling the pinch of federal government policies to keep a check on the number of foreign skilled workers. Microsoft chairman Bill Gates echoed similar sentiments when he directly slammed the U.S. administration’s strict limits on temporary visas for technology workers (the bulk of whom are Indians), saying that if he had his way, the system would be scrapped entirely.

“The whole idea of the H1-B visa thing is, don’t let too many smart people come into the country,’’ the world’s richest executive has said. “The thing basically doesn’t make sense.???

Gates was reacting to the current annual cap of 65,000 with an additional 20,000 exempt visas (for foreign graduates out of U.S. universities), taking the total to 85,000 consequent to the outsourcing backlash as well as Americans losing jobs to skilled workers from Asia. Prior to 2000, the H1-B program had a visa ceiling of 65,000 but was increased to 115,000 in 2000 and subsequently to 195,000 for a period of three years, during the tech boom. But, after the three-year period ended, H1-B cap was brought back to the original 65,000 per year, due to protests by American workers in an election year. Last year the quota was exhausted on the very first day the new allocations opened, the first such occurrence.

H1-B is the specialty-occupation visa status under which a large number of Indian information technology firms send their employees to the United States for on-site project-development work, popularly known as body-shopping. The United States is the prime export destination for the Indian software industry.

Echoing Gates words, Ravi Venkatesan, chairman, Microsoft India, has said: “There exists a demographic challenge in the U.S. with an aging population whereas India has dynamic and highly educated youth. It is in the natural interest of both the economies to allow this integration of resources and talent. In this day of globalization, dropping of artificial barriers such as this is essential to allow free flow of trade and talent to benefit both countries while fostering economic development at the same time.???

U.S. industry has been pushing for a removal of the cap which has been opposed by labor unions. Complete America — a coalition of over 200 corporations, universities, research institutions and trade associations — has been advocating for a raise in the annual cap. The allowance of the extra 20,000 visas to foreign nationals graduating from U.S. universities was as a result of their efforts.

As things stand, the Bush administration does not seem to be in any mood to comply. The H1-B visa program has been criticized by unemployed U.S. professionals for “taking away??? their jobs. The administration is of the view that unemployment among U.S. computer engineers regularly exceeds the figures in other industries.

Indian information industry czars are predictably happy at Gates’ clarion call which highlights the mismatch between the availability of skills and demand for tech workers in the U.S., despite the U.S. administration claims. The Indian IT industry is concerned that the limit will affect Indian software firms, which have a large number of clients in the U.S., though it would bring more offshore work to India from the U.S.

The restriction will curtail the flexibility to reinforce onsite teams at various stages in the software development lifecycle (system requirement study, testing and implementation phases) if adequate and proactive planning is not in place. Big companies like Wipro, Infosys, HCL and Tata Consultancy Services have already built robust H1-B visa banks, with a shelf life of 6 years, in anticipation of a shortage; it is the smaller IT firms that will really have to struggle. However, it is believed that if the cap remains for a longer while, it will definitely impact the Indian IT industry as a whole.

In a statement, India’s software giant Infosys has said: “Bill Gates is an icon of American industry. His voice creates a positive cluster of opinion and is a clear signal to policy makers what U.S., Inc. wants. Such voices will be more vocal now as you will see the rhetoric fading out.???

In any case, there are other areas, apart from the tech-sector which may feel the pinch of the H1-B cap. Reports in India highlight the acute shortage of nurses and teachers which can adversely affect U.S. while at the same time open up opportunities for Indians. According to Stephen S. Nuell, president of Nurses for International Exchange, the demand for nurses has escalated so much that the U.S. Congress is set to bring in legislation to make visas to nurses easily available. Estimates put the demand for Indian nurses in the U.S. to the tune of 250,000. Estimates of shortage of teachers in U.S. range up to 700,000. This is a huge human resource problem. So What is to be done? Could floating hospitals be an answer? Or schools?

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