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Patricia Hewitt defends jobs shift to India

Infuriated unions have criticised the Trade Secretary for defending UK job exodus to India, reports Vijay Dutt.

india Updated: Dec 25, 2003 21:34 IST
Vijay Dutt
Vijay Dutt

Patricia Hewitt, the Trade Secretary, infuriated unions by defending UK job exodus to India during her keynote address at the Confederation of British Industries. Outsourcing to India was major issue at the meet, addressed by Tony Blair as well.

Hewitt is the second senior minister to speak out in support of the outsourcing to India. She said half of the world's poor live in India and the country will benefit from economic growth as jobs moved there. Her critics immediately rounded on her accusing her of giving green light to jobs shift while tens of thousands of workers have been sacked in the UK.

Union and business leaders said her comments were "devastating", but the Hewitt hit out at calls to protect home industries such as call centres, textiles and IT operations from the threat of India. She said: "I know that often it is much easier to see the short-term benefits of protectionism than it is to see the long-term costs to consumers."

"I also know there is no future for Britain in low-cost, low-margin production, certainly not trying to make cheap, white cotton T-shirts. Why deny India the benefits of growth that comes from these jobs? Half the world's poor live there."

Deputy Prime Minister John Prescott too had said changes in business environment and technological advances in other countries need to be accepted and outsourcing to India would help the British economy by giving it more competitive edge. However, Hewitt has caused more outrage by being blunt in refusing to bow down to union pressure.

GMB Union General Secretary Kevin Curran said: "To congratulate British companies for going for cheap labour, over highly skilled, highly motivated workers in Britain does not seem to be in the best interests of the British economy."

British Chamber of Commerce policy adviser Matthew Knowles also said it was very worrying that a British minister was saying, "it is a good thing jobs are being lost in this country". He added: "It should not be about what benefits India, it should be about what is best for Britain. All we are asking for is a level playing field."

But companies are in no mood to listen to such reasoning. HSBC has gone ahead and announced 4000 job losses with the closure of call centres in the UK and shifting to India.

First Published: Dec 25, 2003 21:33 IST