Indian IT companies are not too perturbed by the Obama administration's latest attempts to get American companies to keep jobs in the country. On January 11, the US President, Mr Barack Obama, met executives of 14 major companies to encourage them to bring jobs back to the US. Called ‘Insourcing American Jobs' forum at the White House, this includes honchos from Ford, DuPont and Intel.

In the coming weeks, Obama administration will put forward new tax proposals to reward companies that choose to invest or bring back jobs to the US, and to eliminate tax advantages for companies moving jobs overseas.

Indian IT firms, however, remain unfazed. Mr L. Suresh, President of ITsAP (IT-ITES industry association of Andhra Pradesh), said that it still makes sense for US companies to outsource work to India. “An average voice-based support job would cost $35-40,000 (or about Rs 20 lakh) a year. Compare this with Rs 3-4 lakh in India. They can recruit four-five people in India with that money,” he said.

“When it comes to tech support and other KPO jobs, they don't have an option but to come to India,” he added.

IT industry watchers say that as the US election draw near Obama will be under more pressure to create more jobs, and hence, the proposed policy is driven by political consideration than an economic one. Mr N. Chandrasekaran, CEO and MD, TCS, said, “As long as there are macro problems and unemployment increase in different markets, governments will take different views and we understand that. We are in the business of solving our customers' business problems, and staffing is only one step in the chain. Now, whether we do the staffing offshore or onshore or hire people overseas is something that we will have to take into account depending on the project.”

Indian firms are also encouraged by the fact that previous attempts by the US administration to influence American companies hasn't really changed much. “It all depends on the kind of sops they get. If incentives far outweigh outsourcing costs, companies could look at insourcing,” said Mr J.A. Chowdary, Chairman of finishing school TalentSprint and former Managing Director of NVDIA India. He feels that India has emerged beyond an outsourcing destination with multi-national companies looking at India as a market itself. He reminded that earlier attempts by the US Government to curtail outsourcing failed.

>kurmanath@thehindu.co.in

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