Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: If you see the job openings, it's for a senior role,
Speaker 2: a software engineering role in high level.
Speaker 1: Yeah.
Speaker 2: If you scroll below, there is something related to audits
Speaker 2: this technology.
Speaker 1: Earlier this week, I went job hunting on LinkedIn with
Speaker 1: side Nayak, Bloomberg finance reporter based in Mumbai.
Speaker 2: You can also experiment with other firms like say a
Speaker 2: Goldman Sachs. Goldman Sachs has an opening in Hyderabad for
Speaker 2: Corporate Planning and Management Vice President Software Engineering in Hyderabad.
Speaker 1: Now, I am not planning a career pivot or a
Speaker 1: move from New York to New Delhi. We did this
Speaker 1: so CIDI could show me that jobs in India's finance
Speaker 1: sector are not what they used to be. City covers
Speaker 1: the big Wall Street banks, JP, Morgan, Chase, Morgan, Stanley,
Speaker 1: Goldman Sachs. For years, much of the coverage of the
Speaker 1: global banking industry and its white collar employees was focused
Speaker 1: on the US and Europe. But City and I weren't
Speaker 1: looking for jobs in New York or Paris. We were
Speaker 1: looking in India, where there is a hiring frenzy.
Speaker 2: Wall Street banks don't have a big presence from the
Speaker 2: retail site. But if you look at the corporate side
Speaker 2: as well as the investment banking side and the wealth side,
Speaker 2: basically they have a huge presence. This is your JP Morgan,
Speaker 2: your Barclays, your HSBC, your Deutsche Bank.
Speaker 1: City is on a team of Bloomberg reporters tracking Wall
Speaker 1: Street's growing reliance on Indian hubs. This is a shift
Speaker 1: that's accelerated as President Trump Titan's visa requirements and as
Speaker 1: India's booming wealth management industry and private credit continue to grow.
Speaker 2: JP Morgan Chase is hiring credit specialists in Mangalore. Goldman
Speaker 2: Sachs is hiring analysts to review loans tight to everything
Speaker 2: from commercial property to yachts. So what began as low skilled,
Speaker 2: call centered jobs in India have now evolved into a
Speaker 2: mission critical hub of global finance and technology.
Speaker 1: This is the Big Take Asia from Bloomberg News. I'm
Speaker 1: David Gura in for Wanha. Every week we take you
Speaker 1: inside some of the world's biggest and most powerful economies
Speaker 1: and the markets, tycoons and businesses that drive this ever
Speaker 1: shifting region. Today on the show, Indian based workers once
Speaker 1: supported American financial services firms now they're increasingly key to
Speaker 1: their operations. How India's government is encouraging Wall Street firms
Speaker 1: to expand their footprint in India, and how President Trump's
Speaker 1: new visa policies could speed up the push. India has
Speaker 1: been a tech hub for decades. In the late nineties
Speaker 1: and early two thousands, the country saw a call center boom,
Speaker 1: with multinational corporations like American Express, IBM and Goldman Sachs
Speaker 1: setting up Global Capability Centers or gccs and staffing them
Speaker 1: with Indian workers. The goal was to provide twenty four
Speaker 1: to seven low cost operational support for customers in the US.
Speaker 1: Here's Bloomberg City Nayak.
Speaker 2: These firms operations in India were largely to address grievances
Speaker 2: of customers or initiate sales through phone calls. So, for example,
Speaker 2: if you're a client based in US and had grievances
Speaker 2: related to insurance, the chances were that Indians had these
Speaker 2: call centers would answer these calls and help address these concerns.
Speaker 1: But that has changed dramatically over the last decade. Take
Speaker 1: Goldman Sacks as an example. In two thousand and four,
Speaker 1: its office in the southern city of Bangalore had three
Speaker 1: hundred employees, most of whom focused on tech and IT support.
Speaker 1: Today that same office is home to more than eight
Speaker 1: thousand employees. Those workers do everything from core financial analysis
Speaker 1: to risk management, the kind of jobs that used to
Speaker 1: be done in US cities.
Speaker 2: The perception that Indian gccs are providing call center jobs
Speaker 2: is kind of changing. Gccs that are now offshow centers
Speaker 2: established by these multinational cooperations or financial services firms now
Speaker 2: deliver high quality, cost effective services and support their global operations.
Speaker 2: Call center jobs are now being outsourced to other emerging
Speaker 2: economies like Philippines. Property prices also are cheap because the
Speaker 2: value of rupee is depreciating visa either dollar.
Speaker 1: So it sounds like there is quite a boom here.
Speaker 1: How far along are we?
Speaker 2: Financial services firms? Banks have a significant employee base in India.
Speaker 2: The top six US banks in India, that is JP, Morgan,
Speaker 2: Bank of America, Goldman, Sachs City, etc. Employ about one
Speaker 2: fifty thousand people in India. We know that Goldman, SAX
Speaker 2: and Morgan Stanley have more staff in India than anywhere
Speaker 2: outside the US. What we understand from sources is that
Speaker 2: one European bank concluded that a catastrophe in India such
Speaker 2: as an earthquake, would disrupt its activities more than a
Speaker 2: similar disaster at its headquarters.
Speaker 1: Is this going to be a bigger magnet? Do you
Speaker 1: think in the years ahead it.
Speaker 3: Is going to be a bigger magnet.
Speaker 2: Because most of these colleges as well as tech centers
Speaker 2: are churning out low cost talent on a large scale,
Speaker 2: there will be more opportunities for formal and informal workers.
Speaker 2: This is because there is no dearth of talent from
Speaker 2: the tech side in India. There's always a lot of
Speaker 2: graduates every year that get pulled up into these roles,
Speaker 2: which is why we can see the boom expecting to
Speaker 2: continue and most of these firms trying to leverage on
Speaker 2: the talent that is built in India.
Speaker 1: According to estimates from the National Association of Software and
Speaker 1: Service Companies and consulting firm Zenov, employment at gccs in
Speaker 1: India is projected to jump fifty percent to as many
Speaker 1: as two point eight million people by twenty thirty. Cdesa's
Speaker 1: employees at these gccs are breaking ground too. A source
Speaker 1: told Bloomberg that Black Rocks a Laddin portfolio management platform
Speaker 1: was developed in India, as was Goldman's Atlas trading system.
Speaker 1: Then there's Zel, the popular payment app. It was developed
Speaker 1: by Arizona based Early Warning Services, but Sidi's sources told
Speaker 1: her that India played a crucial role behind the scenes.
Speaker 2: We have information from our sources that the technology behind
Speaker 2: running this zell app was entirely built out of India
Speaker 2: through Bank of America, Goldman Sachs gccs in Bangalore and Hyderabad.
Speaker 2: This was kind of inspired by the fintech revolution in India.
Speaker 2: We have a UPI Unified Payment Interface system in India
Speaker 2: where there is a bank to bank transfer of payment
Speaker 2: systems using a QR code. So most of these inspirations
Speaker 2: were kind of instrumental in making or building the Zell app.
Speaker 1: Could you situate this in kind of the broader Indian economy?
Speaker 1: How important it is that the growth of these gccs
Speaker 1: the importance of Wall Street's interest in putting some of
Speaker 1: these higher skill jobs in India.
Speaker 2: So gccs are a vital component of the Wall Street
Speaker 2: firm's global strategies as well as for India's economic growth.
Speaker 2: They are fostering job creation, skill development, and foreign investment
Speaker 2: in India that is in turn getting fed into India's
Speaker 2: GDP growth. Their revenue is expected to search to one
Speaker 2: hundred and five billion dollars from about forty point four
Speaker 2: billion dollars in FY nineteen, according to na Scom and
Speaker 2: Zenov estimates. So this is the kind of impact that
Speaker 2: we are talking about. Their growth in India is not
Speaker 2: just important for fueling economic growth, job creation, but also
Speaker 2: to get a lot of foreign influ in terms of
Speaker 2: foreign direct investments in India.
Speaker 1: This year, US immigration policy through a ranch in India's
Speaker 1: workforce overseas, but it also became a boon for their
Speaker 1: domestic gccs. How that's after the break In late September,
Speaker 1: President Trump announced it change to US immigration policy with
Speaker 1: a big price tag, a one hundred thousand dollars fee
Speaker 1: for an H one B visa application.
Speaker 4: The country would rather not have to pay one hundred
Speaker 4: thousand dollars, but rather, how do you do that? You
Speaker 4: hire America, So there's an incentive to hire.
Speaker 1: The H one B is a non immigrant visa which
Speaker 1: allows US employers to temporarily hire foreign workers in highly
Speaker 1: skilled roles engineering, technology, medicine. When Trump made the announcement,
Speaker 1: the US's financial sector found itself relatively unprepared, as Bloomberg
Speaker 1: City nayak So.
Speaker 2: Indians make up roughly seventy percent of H one B holders.
Speaker 2: When Trump first announced one hundred thousand dollar visa fee,
Speaker 2: it was seen as a big blow for Indians.
Speaker 3: We had JP Morgan.
Speaker 2: CEO Jamie Dimmons say that the announcement caught everybody off guard.
Speaker 2: Apart from that, we had HSBC stating that the new
Speaker 2: one hundred thousand, h one B dollar fee in the
Speaker 2: US was manageable due to their relatively low number of
Speaker 2: foreign workers compared to other firms.
Speaker 1: JP Morgan, APAX CEO and head of Banking Short Leanard
Speaker 1: joined Bloomberg TV's Menkadoshe shortly after Trump's announcement and expanded
Speaker 1: on the company's disappointment that how this would impact India's
Speaker 1: younger workforce.
Speaker 3: So, will JP Morgan be moving more jobs to your
Speaker 3: GCC here.
Speaker 4: Yeah, well that's a very good question, and if it was,
Speaker 4: it would be a shame because it obviously has been
Speaker 4: a great source of opportunity for Indian students. You know,
Speaker 4: India producer's two point eight million STEM students every year
Speaker 4: and they've gone all over the world, including.
Speaker 1: In a statement to Bloomberg. A White House spokeswoman said
Speaker 1: changes to the H one B visa program were necessary
Speaker 1: to put America first. She said the bank's efforts to
Speaker 1: move jobs overseas is quote evidence that they were using
Speaker 1: foreign workers to undercut Americans wages. Though it is a change,
Speaker 1: it's not like the rug had gotten pulled down from
Speaker 1: under India's financial industry City says the Indian economy was
Speaker 1: expanding and the upper class was growing in this.
Speaker 3: In the middle of a wealth broom.
Speaker 2: The boom had already started post COVID, and Trump's announcement
Speaker 2: of the visa fee kind of gotten in for these firms,
Speaker 2: like an incentive to hire more talent inward. Banks that
Speaker 2: might consider transferring a worker to the US may now
Speaker 2: be opened to hire them in India itself.
Speaker 1: An H one B visa used to cost on average,
Speaker 1: around five thousand dollars. JP Morgan is among the top
Speaker 1: ten companies in the US that sponsors the most H
Speaker 1: one B visas. City says the new visa fee has
Speaker 1: sparked some chatter among the banks.
Speaker 2: Some of the Wall Street banks in India were looking
Speaker 2: to talk to their counterparts in the US to talk
Speaker 2: to them about opening more roles in India specialist roles
Speaker 2: in India to kind of not be impacted by the
Speaker 2: higher he B dollar fee.
Speaker 1: Then there's the math involved in hiring people in India
Speaker 1: versus in a US city.
Speaker 2: Firms know that the salary of an Indian tech engineer
Speaker 2: is much less than what it is in the US
Speaker 2: for an entry level role at a US bank's GCC,
Speaker 2: and engineering graduate in India could earn anything between say
Speaker 2: three hundred thousand rupees to eight hundred thousand rupees a
Speaker 2: year depending on the location.
Speaker 1: That's between four and ten thousand dollars per employee.
Speaker 2: That compass with a sixty thousand dollars annual fee for
Speaker 2: an Indian on a US visa and up to one
Speaker 2: twenty thousand dollars for a US citizen in the same role.
Speaker 1: So he says, these calculations are driving banks to think
Speaker 1: differently about the way they balance staffing in their offices
Speaker 1: in the US and in India.
Speaker 2: This has actually accelerated the pivot to India Wall Street
Speaker 2: banks for hiring anyway, this fee is just a push
Speaker 2: potentially bringing more jobs to India. So recruitment firms have
Speaker 2: told us that with the new fee, workers have started
Speaker 2: to question if a US job is a priority for
Speaker 2: or most of the employees, as well as the employers.
Speaker 2: Firms have also realized that this is not going to
Speaker 2: be cost effective and India, which was already seeing a
Speaker 2: GCC boom, would now benefit from this.
Speaker 1: Trump said the higher H ONEB VISA application fee is
Speaker 1: to address quote abuse of the program and to compel
Speaker 1: US companies to hire Americans, but cities reporting shows it
Speaker 1: could backfire and hurt the US instead.
Speaker 2: Senior executives from at least two US banks in India
Speaker 2: are in talks to consider ways to ramp up their
Speaker 2: global capability centers in India. This is in response to
Speaker 2: the H ONEB VISA crackdown. According to sources, some global
Speaker 2: lenders that had extended offer letters for positions in the
Speaker 2: US are also looking to either revoke them or create
Speaker 2: alternative roles at these gccs.
Speaker 1: That's bad news for the US job market potentially, but
Speaker 1: it could be great news for India.
Speaker 2: If these jobs are coming to India, it is a
Speaker 2: boom for the job market. A tech engineer or a
Speaker 2: tech specialist who has just graduated has more options on
Speaker 2: the table. He has the option of getting into a
Speaker 2: startup a GCC of fintech firms. The role is being
Speaker 2: elevated in the sense that he has to do more
Speaker 2: jobs that involve research, legal development, specializing, getting into certain
Speaker 2: spaces that only high skill talent can tap into. That
Speaker 2: is the kind of opportunity boom in gccs has provided
Speaker 2: the tech talent. At the same time, if these firms
Speaker 2: are getting huge real estate spaces in India, they do
Speaker 2: require informal jobs as well, and that's kind of being
Speaker 2: a boon for the entire Indian job market.
Speaker 1: So the says the government has seen an opportunity and
Speaker 1: is working on a set of policies to incentivize the
Speaker 1: financial sector designed to help the GCC ecosystem thrive.
Speaker 2: India announces its federal budget on the first of February
Speaker 2: every year. This is kind of a broad layout that
Speaker 2: the government has on revenues, taxations, incentives, etc. From our sources,
Speaker 2: we have found out that there is a GCC policy
Speaker 2: framework that's going to be in the making so that
Speaker 2: more US firms or more foreign firms are encouraged and
Speaker 2: incentivized to build more GCC hubs here. These banks employ
Speaker 2: a huge workforce in India. Foreign firms bring in a
Speaker 2: lot of capital for the long term. These are strategic
Speaker 2: investments made for a fifteen to twenty year horizon, which
Speaker 2: is why the government wants to incentivize these firms to
Speaker 2: build more operations in India, set up more offices, employ
Speaker 2: more workers, and kind of steer the job market.
Speaker 1: So they says, it'll be a while before we see
Speaker 1: how this pans out in India and in the US.
Speaker 1: As banks recalibrate their global hiring strategies. One thing banks
Speaker 1: are watching and something that's holding them back from expanding
Speaker 1: too aggressively is how Trump could retaliate.
Speaker 2: So US firms are walking a fine line as then
Speaker 2: look to shift more of these roles to India. There
Speaker 2: is a risk that there could be a backlash from
Speaker 2: Trump and Trump could.
Speaker 3: Now target GCC's next.
Speaker 2: It could bring GCC's in Trump's crosshairs. When we spoke
Speaker 2: to our sources, we found that these banks were considering
Speaker 2: Trump's imposition of tariffs or sanctions on GCC sees as
Speaker 2: a major risk to their operations. They said that most
Speaker 2: of these banks and their US headquarters were talking to
Speaker 2: Trump about the issues and the fact that they were
Speaker 2: hiring a lot of people in India, so any impact
Speaker 2: of the government's orders would directly be felt on these.
Speaker 3: Banks operations as well.
Speaker 2: But that is a story for another day.
Speaker 1: This is The Big Take Asia from Bloomberg News. I'm
Speaker 1: David Gera. To get more from The Big Take and
Speaker 1: unlimited access to all of Bloomberg dot com, subscribe today
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