U.S. and Indian IT companies have been lobbying against Obama administration for passing new restrictions on technology firms in hiring skilled foreign workers.
The Washington Post reports that a Senate immigration bill will limit the ability of American outsourcing companies to hire technology workers from abroad.
According to the report, this has prompted fears of harming trade relations between the two countries.
Industry officials said that it could drive up costs for businesses, which could be passed on to consumers.
Indian firms fear that nation's fast-growing technology sector, which sends tens of thousands of workers to the United States on H-1B temporary worker visas, will bear the repercussions.
Unions and Democrats said that the firms avoid hiring American workers because of cost concerns.