The latest symptom of the worldwide recession? The West becoming hostile towards Indian outsourcing hubs such as Bangalore, says Saritha Rai.

Is Bangalore, India’s globalisation hotspot and magnet for outsourced jobs from the West, caught in the eye of the global economic crisis?

The answer, if you ask its residents, is yes.

The latest swipe at the city came earlier this month from US President Barack Obama. Rallying American corporations around a protectionist cause, Obama criticised the current tax code for saying companies “should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York”.

The world’s biggest corporations including General Electric, Google, HSBC, IBM, Microsoft and Tesco have large operations in Bangalore. Working for these companies – in their gleaming buildings with the air conditioning always a couple of degrees colder than most workers are used to – is likened by many as living inside a “globalisation cocoon”.

Of course, life outside is harsher. The buildings are ultra-modern but the roads leading to them are still filled with potholes and clogged with traffic.

Pink slips are commonplace, tech jobs can be hard to find and workers’ pay hikes and perks are disappearing.

And even as many tech workers in the city live a truncated version of the American dream, the Bangalore bashing is getting to them.

The American President may have been speaking metaphorically but many Westerners feel resentful towards Bangalore, says Anshuman Mishra, founder of software start-up Ivontu. The recession is furthering this antipathy, says Mishra, whose firm licenses software to read the news and analyse its impact on stock markets in Europe and the United States.

Many of his potential customers in the West have never visited Bangalore and know little about the city – yet still they have a low opinion of it. “They believe it is a faraway place that is swallowing up all their jobs,” says Mishra. Ivontu has not sold any licences to Western customers so far.

Until a few months ago, Nandini Baskar was a telephone sales agent with a US-based ERP software maker. Her accent often gave away her location to customers.

When some of them heard ‘Bangalore’, it was as if a small red flag had gone up, describes Baskar. “You took away all our jobs, I don’t want to buy anything from you,” was a common reply when she targeted small business owners with her phone pitch.

A few months ago, the global economic recession claimed Baskar’s job. She found herself handed a pink slip when the US parent company shut down its local operations. But finding another job is as difficult in Bangalore as anywhere in the West, says Baskar, who is inundating job-search sites and company websites with her CV.

As the city weather turned balmy last week, a Bangalore-based group decided to orchestrate some backlash of its own.

The Anti-American Imperialism Forum marched through the crowded Mahatma Gandhi Road, through the debris and blockades of the upcoming metro railway construction, and stomped into the Bank of America building.

As group members raised slogans against Obama ‘terrorising’ Bangalore’s outsourcing industry workers, they were arrested and taken away. It was just another peaceful demonstration, Bangalore-style.

Experts weighing in on the Bangalore-Buffalo matter say the backlash against the city is only temporary. “Bangalore’s magic formula is quicker, better, cheaper,” says Kiran Karnik, former chairman of India’s outsourcing trade body, Nasscom.

The city delivers in uninterrupted 24×7 cycles, whether it is the Christmas holiday season or the Indian Diwali festival, says Karnik, who is chairman of the recently appointed board of outsourcing firm Satyam Computer Services.

Some Bangalore techies have turned pragmatic in the face of all the negative attention, and are convinced of Bangalore’s strengths. “The wage differential between Bangalore and the Silicon Valley is nine times or more,” says Lalit Mangal, who worked with the local unit of Oracle before he branched off and started his own company. It will be decades before salaries in Bangalore come on par with peers in the West, he says.

Mangal’s software firm maxHeap Technologies produces software for community use. He says he and his partners are not interested in overseas markets, they would rather focus on the Indian market.

This city of seven million, known for exporting software, silk and stone, has been battered by the global economic storm. Glum tech workers say they only see a respite from the Bangalore bashing when Western economies start swinging northward again.