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India is a growing powerhouse of technology. Its position in the global economy cannot be ignored. It is interesting to compare how Canada and the US are reacting to this phenomenon.

For Canada, India provides the opportunity for a new era of trade.

Prime Minister Stephen Harper will visit Mumbai and Delhi between Nov. 15 and 18 and meet with Indian Prime Minister Manmohan Singh, sources said, a visit that is intended as a turning point. India and Canada are moving to jolt stagnant trade ties, concluding a series of trade-related deals, including opening nuclear commerce and starting the first phase toward a free-trade agreement.

On the other hand, questions are being raised on where US current policy is headed.

If any foreign policy camp best captures mainstream American opinion in 2009, it is probably neo-isolationism: a return to the inwardness of the post-World War I years, when the country refused to join the League of Nations. Even as intellectuals call for cosmopolitanism, more and more Americans are declaring themselves anti-outsourcing, anti-foreign-products, anti-immigration, anti-international-law — and pro-protectionism. According to a February 2009 Gallup poll, nearly half of Americans view foreign trade as a “threat to the economy,” and 65 percent believe the government is spending “too much” on foreign aid.

That explains why Bill Gates was unsuccessful last year in persuading Congress that it should allow US companies to hire more skilled foreign workers by increasing the number of H-1B visas. Without this change in immigration policy, the only solution would be to outsource more technological work to countries such as India.

India to is now asking the US for more H-1B visas.

India is likely to ask the United States to raise the cap on visas for skilled workers at the bilateral trade forum meeting to be held. India may also push for a special mechanism for Indian professionals travelling to the US for short-term assignments arising out of contractual obligations.

Perhaps the mood is now more receptive since a bill now introduced in the U.S. Congress would double the number of immigrant worker visas available each year under the H-1B program.

The Innovation Employment Act, introduced by Rep. Gabrielle Giffords, (D-Ariz.), late Thursday, would increase the cap in H-1B visas from 65,000 a year to 130,000 a year. In addition, there would be no cap on H-1B applications for foreign graduate students attending U.S. colleges and studying science, technology and related fields. Currently, there’s a 20,000-a-year cap on visas for graduate students in all fields.

The legislation would increase the H-1B cap to 180,000 in the years 2010 to 2015 if the 130,000 cap is reached the year before.

Microsoft Chairman Bill Gates had repeated his pitch:

“We provide the world’s best universities … and the students are not allowed to stay and work in the country,” Gates said Wednesday. “The fact is, [other countries'] smartest people want to come here and that’s a huge advantage to us, and in a sense, we’re turning them away.”

Undoubtedly all countries gain by a freer trade in technical abilities. It is not a forced choice between immigration and outsourcing. An appropriate balance is probably optimal.

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