With Donald Trump Back As US President, Tech Firms Gear Up For New Policies

As Republican Donald Trump readies to become the 47th President of the United States of America (he was also its 45th), many businesses have to start evaluating their game plans to navigate the developments that are set to evolve in the coming weeks. Indian IT industry, which is heavily dependent on the US for earning more than one third of its revenue, is also keenly following the ongoing developments. Not only that, the growth in the US economy is critical for driving the growth of the world economy in many ways.

Global enterprises of American origin will spend more on technology if the country’s economy performs well. Hence, the policies of the Trump administration are critical for reviving technology spending in the coming years. Importantly, the IT spending has been reeling under a slowdown for the last two years after witnessing a surge in the post-pandemic period. Factors like high level of government spending during the Covid-19 pandemic, the Russia-Ukraine war and related factors led to an inflationary environment in the US and European continent. Despite easing of inflation in the recent quarters, the US economy is far from healthy as shown from tepid job creation numbers.

In this context, next US administration has the critical task of coming up with more business-friendly measures with tax incentives for reviving the economy. For the Indian IT industry, another important development to watch out for would be Trump administration’s policies on immigration, especially on professional immigration. Global tech firms and Indian IT companies send engineers to client locations in the US for executing projects on H1B visas. During Trump’s earlier term, these norms were tightened significantly. In that period, many Indian IT firms had lost business in the US due to lack of skilled resources. Since then, most companies have aggressively localised by hiring US citizens. Though the Biden administration did not bring any meaningful changes in the H1B visa norms, Trump comeback is likely to see stricter immigration norms. In this context, the domestic IT industry has to gear up to navigate the likely complex situation.

Other than H1B visa norms, global tech giants are betting big on artificial intelligence (AI) to drive their growth. However, regulations over unbridled growth of AI are being hotly debated across the world. Against this backdrop, global tech companies will wait for policy directions from the Trump administration. Under Biden, tech firms agreed to go in for self-regulations with a pledge to leverage AI for the welfare of mankind. But, recent developments have shown that self-regulations may not be adhered to given the competitive pressures of the market. With key business people like Elon Musk on his side, Trump is likely to opt for more responsible AI policies that mitigate the risks arising from AI solutions without killing innovation. Taken under any context, it is certain that Donald Trump’s return as the President of the United States is likely to herald a new era for the technology industry in more way than one.