Why Oracle lawsuit is bad news for Indian IT companies

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Technology companies including Infosys and Tata Consultancy Services, may find themselves in the line of fire as anger against outsourcing in America turns bellicose as a new government led by Donald Trump takes charge in the world’s biggest market for information technology services.
In what many view as a sign of things to come, the US Labour Department sued software giant Oracle, earlier this week, accusing the California head quartered company for discriminatory hiring practices against White, Hispanic and African-Americans in favour of Asians, particularly “Asian Indians”.
“I would expect to see a rise in the number of lawsuits which are then further amplified by a populist press,” said Peter Bendor-Samuel, CEO of IT consultancy firm, Everest Group, adding that rising protectionism in both the US and the UK fosters an environment which encourages law suits. Samuel also sees “increased scrutiny” from US regulators creating more friction.
For their part, Indian firms such as Infosys and TCS are bracing to deal with changing circumstances. “We continue to hire and in vest locally. However, given the skill shortages in the US and the availability of technically skilled workforce in various global markets, we also rely upon visa programs to supplement these skills,” said Infosys COO Pravin Rao.
“In addition, the president is a seasoned entrepreneur and as such we expect the administration to be business friendly and innovation friendly,” said Rao. TCS and Oracle declined comment.
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