Maq Masi Blog

When the United States threatens a 50% tariff on Indian goods, it is not just a matter of trade—it is leverage built on India’s dependence. Washington knows it holds two trump cards: India’s vast consumer market and its taxpayer-funded talent pipeline. Silicon Valley’s engineers, Wall Street’s analysts, and America’s technology giants thrive on Indian graduates educated at public expense. This is the hidden bargain: India subsidises the education of its best minds, only to see them serve the very power that slaps punitive tariffs on its exports.

The numbers are sobering. By 2023, over 4.8 million Indian-born individuals lived in the US, with Indians consistently taking more than 70% of H-1B visas. This is not merely migration; it is the transfer of India’s most valuable national asset: human capital. Each departure weakens the country’s research base, drains its universities of experienced faculty, and deprives its economy of entrepreneurs who might otherwise create jobs at home.

The injustice deepens when we consider who pays. At institutions like the Indian Institutes of Technology, the government invests around £50,000 to £70,000 per graduate. This public subsidy is meant to strengthen India’s economy and society. Instead, the beneficiaries are foreign firms and foreign governments. Meanwhile, India spends a mere 0.7% of GDP on R&D, compared with 3.4% in the US and 2.1% in China, leaving few opportunities for talent to remain. The result is a taxpayer-funded exodus with no domestic return.

At the other end of the spectrum, India exports its poorest workers to the Gulf. Here, the kafala system ties them to employers in conditions that amount to modern servitude. Their wages are often below subsistence levels, their passports are confiscated, and their rights are minimal. India has leverage—it supplies millions of workers to Gulf economies—but its government has failed to demand reform. The absence of a minimum wage guarantee, enforceable through bilateral agreements, ensures exploitation continues unchecked. This silence amounts to complicity.

The failures are structural: talent at the top is lost because India cannot retain it; workers at the bottom are abused because India does not protect them. Both expose the same weakness—short-term governance that sacrifices citizens’ welfare for temporary gains.

The solutions require political courage. First, introduce dual citizenship. By allowing India’s global diaspora to retain full political and economic rights, the country can harness their networks, capital, and expertise, turning brain drain into brain gain. Countries like Israel and Ireland have successfully leveraged such policies to pull talent home. Second, demand a minimum wage floor for Indian workers in the Gulf. Just as trade agreements set standards for goods, labour agreements must set enforceable protections for people. India’s vast labour supply gives it bargaining power, but this must be exercised with resolve.

In the end, the pattern is unmistakable. India subsidises an elite that enriches the US, tolerates the exploitation of its workers in the Gulf, and remains vulnerable to tariff threats that deepen dependency. To break this cycle, the state must finally protect both ends of its human capital spectrum: retaining its best minds and defending its most vulnerable. Anything less is not merely inefficient; it is a betrayal of the very citizens who fund the nation’s future.