India's IT-BPO industry warily cheers Obama's victory, fears cut down in outsourcing

US President-elect Obama is a staunch supporter of the growing India-US strategic partnership but has strong views about outsourcing of US jobs overseas, especially at a time when the US economy is reeling from a financial crisis and companies are handing out pink slips or cutting wages by the thousands to curtail costs and deal with the economic slowdown.

Obama feels that it is "only natural" that the world's oldest and largest constitutional democracies should enjoy "strong relations" but has put his foot down when it comes to outsourcing.

"When I am President I will give tax credits to companies that hire in the United States and end tax breaks for companies that ship US jobs overseas," he had said during an election rally in Cleveland, Ohio, hinting that outsourcing is the cause behind the slump in the US economy.

Obama's viewpoint has triggered concerns among Indian IT-BPO firms that are already witnessing decline in outsourcing business from the US as clients there are either delaying or cutting down on IT spending.

In a report based on a global survey, investment bank Goldman Sachs has also warned that IT budgets of US companies could decline by 5 percent in 2009 compared with 2008 with concerns growing that the US economy is on the threshold of a recession, probably the worst financial crisis since the 1930s.