US Investigates Outsourcing Contracts of Software Firms

Published By : 15 Jun 2015 | Published By : QYRESEARCH

India’s largest software companies, Infosys and Tata Consultancy Services along with few other firms such as Southern California Edison, Walt Disney, Fossil, and Cognizant Technology are under the scrutiny of the U.S. government. Nasscomm has mentioned that the investigation could affect the long-term prospects of the future contracts between the Indian IT organizations and the U.S. firms. Nasscomm is working on resolving the issues fast. Nasscomm president R Chandrashekhar has mentioned that the issue can have serious impact over future business. He further said that the IT sector in India will be destabilized if such hostile business environment is created. 

Indian IT companies have denied of any wrongdoing on their part. According to the reports, Communications and IT minister Ravi Shankar Prasad has told that if it is required, the Indian government would intervene to solve the issue of alleged visa violations. He is hopeful that TCS and Infosys would be able to solve the matter. The US Labour Department is investigating whether the top outsourcing firms have replaced full time technology workers by H-1B visa workers.  

According to the senators Jeff Sessions and Dick Durbin, a number of large U.S. based corporations have asked American workers to train the foreign workers and have later replaced them with the H-1B visa holders. Southern California Edison had fired 500 employees in August last year and had replaced them with H-1B visa holders from TCS and Infosys. 

India’s information technology industry worth US$146 billion is undergoing transition currently. Amid currency fluctuations, the sector is coping to match the growth rates it registered in 2000. 
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