When Donald Trump first took office in 2017, Wipro became the first Indian company to flag a US president as a business risk. According to an ET Prime report, Wipro’s annual filing with the U.S. Securities and Exchange Commission (SEC) raised concerns over Trump’s policy stance, noting that his tariff and trade decisions could negatively impact their business in America.
In its SEC filing, Wipro noted that Trump’s policies posed risks to their investments in the U.S. healthcare sector. In 2016, Wipro acquired Healthplan Services for $500 million, betting on the success of the Affordable Care Act (ACA) enacted under President Obama. However, Trump’s efforts to repeal the ACA created uncertainty, delaying the anticipated benefits of the acquisition, per the report.
The U.S. election outcome introduces further challenges for Indian IT.
Heightened regulatory scrutiny will likely affect sensitive sectors like technology, critical minerals, and issues related to local job creation, according to Rishabh Shroff, partner (co-head, private client and head, international business development), Cyril Amarchand Mangaldas.
Trump’s first term primarily impacted visa policies, but it also hit corporate budgets and project decisions. Industry executives now worry that his second term could disrupt budgets again. They say the election win has increased uncertainties.
After Trump’s initial win, the National Association of Software and Services Companies (NASSCOM) publicly expressed optimism about U.S.-India tech collaboration. However, as per the report, Indian IT firms began increasing their lobbying efforts in Washington to address policy challenges, particularly regarding visa issues.
The second term of Donald Trump, often referred to as “Trump 2.0,” could bring heightened volatility to global stock and bond markets, highlighted a report by LLama Research.
Over the past few years, Indian IT firms have adapted by hiring more local employees in the U.S. The ET Prime highlights that companies like Infosys and TCS have dramatically increased U.S. hiring, with Infosys employing over 25,000 American workers.
Trump’s immigration stance is not likely to favour the Indian workforce, particularly the H-1B visa policies, according to a Mint report.
Trump’s proposed 20% tariffs on all imports, with even higher rates on Chinese goods, are a major concern. Retail clients of Indian IT firms are closely watching how such tariffs might affect budgets and consumer prices. Likely policy changes will certainly have a ripple effect on the Indian economy, especially in the manufacturing and technology sectors, Mint reported.
Trump’s tariff policies could also impact the U.S. Federal Reserve’s stance on interest rates. The Fed may halt rate cuts, which is likely to affect IT firms as spending shrinks, as per reports.
As U.S. policies remain uncertain, Indian IT firms will have to monitor the potential for policy changes in the healthcare, retail, and banking sectors, which account for over a third of their revenues.
