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India’s outsourcing industry braces for Trump impact

India’s $150 billion IT industry, the cornerstone of a thriving economic partnership with the United States, is on the edge as it closely monitors how U.S. President Donald Trump’s administration will manage policies around the outsourcing and movement of skilled workers.

India’s software services industry is concerned about a bill introduced in the U.S. Congress seeking to double the salary paid to H-1B visa holders which would dramatically increase the costs for the Indian companies employing them.

Indian IT sector leaders will meet both U.S. lawmakers and officials from Trump’s administration to lobby against any major changes to visa regulations.

Chandrashekhar Rentala, President of Indian IT industry body Nasscom, said details of the visit were still being finalised, but chief executives from some of India’s big IT companies would be part of a delegation visiting Washington in the week of February 20.

“Today’s global wars are not about trade or of investment, it is for talent. And a country which closes its doors to talent, is in a sense, losing out,” he said.

India’s trade minister Nirmala Sitharaman said the government was concerned and that any such moves by the U.S. would have “an impact” on India.

India’s IT firms, led by Tata Consultancy Services, Infosys and Wipro, have seen growth slow in 2016, as customers delayed spending ahead of the U.S. presidential election.

Staff from those three companies accounted for around 86,000 new H1-B workers in 2005-14. The U.S. currently issues close to that number of H1-B visas each year.

While few expect a complete shutdown of skilled worker visas as Indian engineers are an established part of the fabric of Silicon Valley, and U.S. businesses depend on their cheaper IT and software solutions, any changes are likely to push up costs.

IT players told Reuters late last year they planned to speed up local hiring, acquire U.S. firms with bigger local workforces and make a renewed push on automation to counter the regulatory threat.

Meanwhile workers at the IT hub of Gurgaon on the outskirts of the Indian capital see the proposed moves as regressive.

“I think that is not a very good move because it is an era of globalization everyone wants to work together, everybody wants to live with each other. It is causing a lot of problems not just in a professional industry but also for families. A lot of people who had been staying have to come back,” said Urvashi Verma, who currently works at an international consultancy firm.

Given that US market accounts for 60 per cent of India’s IT exports, Trump’s America first utterances have reinforced worries of protectionist posturing and unnerved the Indian IT industry which, as it is, has been battling headwinds of a slowing growth.

The head of the union for Business Process Outsourcing employees, R. Karthik Shekhar, said Indian companies should not keep all their eggs in one basket and look for opportunities in other countries as well.

“I think it is time now that we look at other non English speaking markets. That is where French is important, including China – our companies have gone there only to make sure that work comes to China but our companies have not started working in Chinese language. It is time now that we also start learning other languages,” Shekhar told Reuters in India’s IT hub of Bengaluru.

India and US have a joint target of $500 billion bilateral trade, and experts say it may not be easy for the US to ignore India’s concerns.


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Article source: http://africa.tvcnews.tv/2017/02/20/indias-outsourcing-industry-braces-trump-impact/

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