Why Indians Working in US is Bad News for India

   2024-07-03 05:07

Many people dream of earning a big income in the US, working for a few years, and then returning to India to support their families, contribute to their communities, or launch startups. However, this vision isn’t playing out as expected. 

While a user on X has some compelling reasons to persuade you to relocate and earn big abroad, the reality doesn’t quite add up. Sunil Avaria shared on X that one must move to California because, “All these people can change their community, change their village, and help their relatives like they have never imagined. Probably at an early age of mid-30s.”

However, the discussion took an interesting turn when someone mentioned NVIDIA: “Ten years ago, instead of going to the US for school, spending $100k, and working 5+ years at a job, you could have invested that $100k in NVIDIA stock and made $25 million today.”

Investing in stocks was just one aspect of the discussion that also highlighted the increased number of Indian employees in NVIDIA. Data suggests that in 2023, NVIDIA reported to have 26,196 employees. Of this figure, about half, which makes 50% of the company’s employees, identified as Asians/Indians. 

Source: Statista 2024

But the Grass Isn’t Green on the Other Side

Despite the impressive earnings abroad, there’s a noticeable gap between what’s being earned and what’s actually making its way back to India. 

The Flipkart case study explains this better. 

In 2018, US retail giant Walmart signed a definitive agreement to acquire a 77% stake in India’s largest e-commerce marketplace Flipkart with an investment of around $16 billion. But, did this money reach India?

Flipkart initially incorporated its holding company in Singapore to attract foreign investments and avoid the challenges posed by India’s bureaucracy and regulatory system. 

Singapore offers an easier business environment, lower taxes, and stronger economic freedom and property rights, making it an attractive destination for many Indian entrepreneurs. 

Not just Flipkart, Blinkit, and Udaan are among the top Indian startups with parent companies in Singapore. But as per the recent updates, the e-commerce firm is reportedly looking at moving its domicile back to India. 

There’s Still Hope 

Meanwhile, Indian IT giants have established a robust presence in the US. According to the HDFC Securities report, Tata Consultancy Services (TCS) employs 50,000 people, Infosys 35,000, HCL Technologies 24,000, Wipro 20,000 and LTI Mindtree 6,500. Together, these companies account for approximately 2% of the US tech industry workforce. 

Harbir K Bhatia, the CEO of the Silicon Valley Central Chamber of Commerce, told the Press Trust of India, “India is one of the largest leaders of innovation in Silicon Valley. The data shows that 40% of Silicon Valley CEOs or founders are from South Asia or India.” 

Source: Statista 2024

Apple, a leader in the global tech industry, also reflects this trend, with nearly 35% of its workforce being of Indian origin. 

Adding to this narrative, Microsoft CEO Satya Nadella, in an interview with CNN-TV18, mentioned that Microsoft employs the second-largest number of engineers from India. 

When asked about the increasing number of CEO positions held by people of Indian origin, Nadella said, “In a country of 1 billion plus people, we should be seeing one-fifth of the CEO posts being held by Indians.”  

What’s Next?

Many startups consider registering in India and often question why companies like Flipkart are registered in Singapore. However, despite deterrents like India’s FDI policy and taxation, the trend is changing. Several Indian startups across sectors like fintech, healthcare, edtech, and e-commerce are planning to relocate their base back to India.

As per reports, in March last year, the Indian government recognised that many Indian startups were based abroad and established a committee to recommend ways to “onshore Indian innovation” to the Gujarat International Finance Tec-City.

Recently, Groww, a fintech startup moved its base back to India from the US. Similarly, PhonePe transferred its domicile back to India from Singapore in October 2022. 

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