Stock prices of Indian IT firms reacted positively to Barack Obama’s win in the US Presidential election, but industry experts feel that there is much apprehension among the IT firms.
From the previous days close Tata Consultancy Services (TCS) shares were up by 5.64 per cent. Infosys shares opened 2 per cent lower this morning but in intra-day trade the stock notched up gains of just over half a per cent. Similarly, Wipro during the intra-day trade was up 1.86 per cent.
For starters the Democrat candidate had said during his campaign that his government will look into the outsourcing issue and is not in favour of jobs going out of the US.
In one of his speeches during the campaign Obama said: “United States must stop providing tax breaks for companies that are shipping jobs overseas and give those tax breaks to companies that are investing here in the United States of America.”
However, NASSCOM, the trade body representing the Indian IT industry, so far has put a brave front to the possibility of an Obama win.
Post the results announcement, Nasscom said: “We congratulate Senator Barack Obama on his historic victory and welcome, and look forward to this opportunity of working with the President-elect and his Administration on mutually beneficial policies that will boost the economies in both nations, enhance bilateral national security matters between India and the United States, and build on the long standing partnership our two democracies share.”
The other concern area for the IT firms is the cap on H1B visa. While Senator McCain was supporting the cause for increasing the limit of H1B Visa, Obama has not emphasised the issue much during his campaign. He had in an interview said that he is in favour of a ‘temporary increase’ in the H1B Visa program as a stop gap until the government reforms the immigration systems comprehensively.
Indian IT firms have been the biggest user of H1B Visa’s. At present, only 65,000 visa’s are available under the H1B category. For the fiscal 2007 period Infosys technologies received 4,559 H1B Visa’s.
