4 Big Reasons Why Indian IT industry is ‘happy’ about Donald Trump’s return despite stricter H-1B visa and immigration laws

India’s information technology (IT) sector is optimistic about President Donald Trump’s return to the Oval Office. The mood is good despite concerns about possible changes to US immigration laws. Immigration experts and analysts have warned that Trump could get tougher on H-1B and other immigration laws during his second term as U.S. President.
Donald Trump’s previous term saw an increase in visa fees as well as salaries for H1B workers. During this period, the Trump administration may reconsider the annual allocation of H1B work visas, which is currently limited to 85,000. H1B applications may face tougher scrutiny as rejection rates reached an all-time high of 24% under the previous Trump administration. The duration and availability of Optional Practical Training (OPT) for international students may also be subject to review.
Despite these concerns, technology stocks led the rise in India’s benchmark stock indices as India’s IT companies celebrated the Republican victory. IT shares gained sharply, leading benchmark indices to rise after it became clear that Donald Trump would take over as US president for a second term. Shares of Tata Consultancy Services (TCS) gained 4.21 percent, Infosys 4.02 percent, Tech Mahindra 3.85 percent and HCL Technologies 3.71 percent on the Bombay Stock Exchange (BSE). Additionally, Persistent Systems increased by 5.86 percent, LTIMindtree increased by 4.75 percent and Wipro increased by 3.75 percent.
So, what is buoying the mood in favor of Indian IT companies?

Here are four possible factors

* Strong dollar: IT companies are concerned about interest rates, inflation, etc., which can help loosen the IT budgets of US companies. Easier financial policies await. The strengthening of the dollar benefits the Indian outsourcing industry as the majority of IT services companies serve the US as a major business market. Thus, while the sector generates most of its revenues in US currency, its operational costs are in Indian rupees.
* Stability in policy making: With Republicans controlling the government, the Senate, and Congress, stability in policymaking is likely.
* Better tax policies for companies: Donald Trump’s proposal to reduce the corporate tax rate from 21% to 15% is likely to ease budget pressures and expand discretionary technology spending by US companies, thereby benefiting tech companies as well as Indian startups registered in the US.
* Alternative to China: Donald Trump’s harsh stance towards China means increased US fund flows to India. Trump is expected to play a tough game against China, as seen in his last term of office. This will benefit Indian IT companies from higher levels of fund flow. Advanced technologies such as artificial intelligence (AI) and semiconductors could see more investment in the United States.