Trump calls India as tariff king. Trumps plans reciprocal tariff on India – will outsourcing get affected? India enjoys zero tariffs on $6 billion dollars of exports to the United States. There is growing discontent on the US side involving tariff on goods and services and financial investments. Will that effect outsourcing services from India?
Withdraw of the Generalized System of Preferences (GSP) from India will be a very strong punitive action. That has extensive repercussions for India as that will impact the outsourcing industries in Bangalore and Hyderabad.
The bilateral trade between US and India stands at $126 billion in 2017. The potential is much higher between two political allies and largest democracies. However, as India tightened the screws of eCommerce on Walmart and Amazon, US is unhappy.
According to some sources, if and when white collar labor shortage in US will ease, there can be heavy tariff on outsourcing trade between the countries.