Impact of US Policies on India as Offshore Outsourcing Destination

The US suffers an unemployment rate of 9.9% which has triggered a need for several

amendments in US policies towards Outsourcing and the companies that outsource jobs to India.

Among those who outsource vastly are the giant US conglomerate GE (General Electric

Company) and IBM (International Business Machines).

Recently, the healthcare bill passed in the US led to 35 million Americans being given fresh

health insurance cover. As the Bill was passed on March 23 and was made a law on March 30,

Companies in India had turned hugely optimistic over the imminent revenue inflow that

followed. Processes like enrollment, insurance claims, transactions and customer services that

followed were to provide employment opportunities to India.

This was because Healthcare providers were forced to operate at lesser cost in providing

healthcare services to Americans. Who will convert all those paper records into electronic and

digital formats? Hence, Indians grew optimistic and had already secured contracts with major

healthcare providers to provide services. The Healthcare Bill is expected to bring employment to

Indians for the next 10 years.

On the other hand, ‘American Jobs and Closing Tax Loopholes Act’ was passed in the House of

Representatives recently which was supposed to exempt companies from certain taxes if they

generate more number of employment within the US. Citigroup, IBM and GE have been the

major gainers from their Offshore Outsourcing activities creating employment opportunities in

India.

However, predictions suggest that this is not going to affect outsourcing to India as the bill was

aimed at increasing job opportunities within the US and was not intended to curb the profits

made by these companies from outsourcing their jobs to India.

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