A fresh trade agreement between the US and India has eased long-standing concerns around potential restrictions on outsourcing to India. The announcement has brought renewed confidence to US boardrooms, where uncertainty had quietly slowed technology investment decisions over the past year.
Although the full details of the deal are yet to be disclosed, analysts say it offers much-needed clarity for US enterprises evaluating long-term IT sourcing and digital transformation partnerships with India.
“Over the past year, uncertainty around the bilateral relationship did seed some behind-the-scenes hesitation around new investments in IT sourcing and, in some cases, slower decision-making on outsourcing commitments,” said Gaurav Parab, principal research analyst at a research firm. He added that the agreement signals alignment and continuity, which should help ease this hesitation.
From India’s perspective, the deal helps remove uncertainty surrounding the $283-billion IT industry. It also reassures US companies on issues such as data sovereignty, political alignment, and India’s access to emerging technologies.
“Tariffs do not impact IT Services, but they do affect the psyche of customers. Lower tariffs and tariff policy certainty help with budgets in the business climate,” said Ray Wang, founder and principal analyst at a consulting firm.
Relief for sentiment, not instant growth
Industry experts cautioned that the agreement should not be seen as an immediate revenue or margin driver for Indian IT firms. Its impact is expected to be more visible in long-term confidence and strategic positioning.
“That helps Indian IT firms in boardroom conversations, even if it does not immediately change deal economics,” said Phil Fersht, CEO of a research firm. “If this signals a broader reset in US-India economic cooperation, it strengthens India’s positioning as a strategic technology partner rather than just a low-cost delivery hub.”
GCC activity set to accelerate
The easing of trade-related concerns is likely to have a stronger impact on Global Capability Centres. Many US enterprises had paused or slowed GCC expansion plans in India amid trade uncertainty.
“US enterprises with existing Indian GCCs and the ones contemplating setting up GCCs will fast-track their engagements and presence due to emerging clarity,” said Sameer Dhanrajani, CEO of an AI advisory firm.
The renewed momentum is expected to support higher-value technology work, moving beyond cost-led delivery models.
Confidence returns amid reduced political noise
The deal is also seen as a step toward reducing political and cultural unease that had affected Indian IT firms and professionals in the US.
“While this is a longer-term social issue, the announcement may mark the beginning of a gradual normalisation in sentiment toward Indian IT and global delivery models,” Parab said.
Continuity in US tech adoption
The agreement reassures US technology companies that it will continue adopting US-origin cloud, data centre, and AI technologies. This continuity benefits Indian IT firms and GCCs that build and manage these platforms.
“This is a good positive sentiment for the IT industry, including GCCs,” said Pareekh Jain, CEO and lead analyst at an advisory firm. He also pointed to possible downstream opportunities in defence engineering through future offsets.
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