Trump Regime impact on Indian IT Industry

The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

K Rohit Rao, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur


Donald trump has finally taken the presidency oath to take charge of the world’s oldest democracy. From managing a multi-billion dollar business, Trump now sits in the seat of the world’s most powerful person. The 45th President of the United States, Trump is described as a crazy protectionist and strong nationalist. Trump has been fiercely pitching for protecting the American jobs against outsourcing.

Trump is strongly advocating against outsourcing and bring reforms in H1B visa system. This would have a direct impact on the Indian IT industry which depends on the US for almost 60% of its revenues. Outsourcing to Indian IT firms saves millions for the US companies and benefits the Indian IT industry. It is a win-win business but this has impacted the American job market for locals. Stricter H1B policies and reforms may force Indian companies to hire more locals which would trim their margins.

Trump considers himself as India’s fan and a true friend. Given the large contribution of the Indian IT industry to the US economy, most of Trump’s extreme thoughts are unlikely to see light of the day. Even Indian companies have moved forward to insulate themselves from any future uncertainties. Indian IT giants TCS, HCL, Infosys and Wipro have started building a strong brand image in the US and have involved themselves in a number of CSR initiatives. Only time will say, whether the way forward is tough for IT companies. But there is a dire need for Indian IT giants to reduce their over dependency on the US and chalk out strategies in the face of technological and political shifts.

 

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