Indian IT firms look forward to benefits from Trump’s return to the White House
The United States is critical to India's US$245 billion IT sector as its largest foreign market.
Among the firms looking forward to Donald Trump's return to the White House on Jan 20 is Ceinsys, which as part of its US expansion, acquired a Michigan-based company in July.
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MUMBAI: India’s tech sector is optimistic that incoming United States President Donald Trump's return to the White House will bring significant benefits for the industry.
Shares in IT companies in India have risen since his election win in November on the back of industry leaders’ confidence that his pro-business approach could help boost spending by clients in the US.
The US is critical to India's US$245 billion IT sector as its largest foreign market.
BENEFITS OF LOWER CORPORATE TAXES
Among the firms looking forward to Trump's return to the White House on Jan 20 is Ceinsys, which as part of its US expansion, acquired a Michigan-based company in July.
Trump announced that he will cut corporate taxes from 21 per cent to 15 per cent.
Ceinsys, which specialises in using artificial intelligence and analytics to deliver mapping and engineering solutions, hopes this will help boost its US business, as funds can be freed up to use on other investments, like IT.
“Small companies like us will benefit from that. The tax cut is really a boon for Indian companies in the US,” said managing director Abhay Kimmatkar.
Seventy per cent of the company's business comes from India and the remaining is from the US - a proportion Mr Kimmatkar is looking to change.
He wants his company's US earnings to make up the lion's share in three years' time.
Other firms are also optimistic about Trump 2.0.
Rishad Premji, executive chairman of Wipro - one of India's biggest IT companies - has said that the incoming president will be “pro-business and pro-growth”, and that this will benefit India's tech services industry.
IT companies that focus on outsourcing from the US and therefore earn in American dollars also hope to reap the rewards of a stronger US currency.
Such a boost is much-needed, as analysts have said that recent quarters have seen American companies holding back on spending amid inflationary and economic concerns.
This comes as India's tech sector is expanding in areas including AI and semiconductors.
BOOST FOR INDIAN STARTUPS
Analysts said that the Trump presidency and his negative stance on China could help to divert funding to India and help startups grow.
Trump previously said he would end China's most-favoured-nation trading status and slap tariffs on Chinese imports of over 60 per cent - much higher than those imposed during his first term.
“India has become and remains one of the most preferred destinations for global capital. That is only likely to continue with the arrival of Trump. In fact that direction of flow is likely to get more strongly routed towards India,” said managing director of Mumbai-based Bexley Advisors Utkarsh Sinha
However, he cautioned that Trump is a “wildcard”.
Companies including Ceinsys which send workers to the US are worried about Trump's position on immigration. Their concerns are not unfounded - IT firms had to adapt during Trump's first term between 2017 and 2021, when visas widely used by the industry became tougher to secure.
