Washington: Indian tech industry contributed nearly 411,000 jobs to the US economy this year and $20 billion in taxes between 2011 and 2015 when American firms leveraged Indian talent to provide innovative and cost-competitive solutions to boost their global market share, a new report by Nasscom (National Association of Software and Services Companies) said on Monday.
The Nasscom report said Indian tech industry contributed more than $375 million to the US Treasury between fiscal year 2011 and 2015, and also helped America secure its borders.
The report, titled ‘Contributions of India’s Tech Industry to the US Economy’, was released by Union Commerce Minister Nirmala Sitharaman here ahead of the first Indo-US Strategic and Commercial Dialogue.
“Leveraging Indian talent, American firms have been able to bring better, innovative, cost-competitive solutions that have helped improve their global market share and bring products with shorter production cycles,” Ms Sitharaman said.
“This very timely report focuses on that part of the India-US bilateral equation, illuminating many of the benefits that Indian IT organisations bring to the US in period covered by the study,” she said.
These benefits included $2 billion in investments, hundreds of thousands of new jobs for Americans, $20 billion in taxes, and more than 120,000 American lives touched through philanthropic work supported by Indian organisations, she said.
Nasscom president R Chandrashekhar said that during the period covered by the study, “Indian tech industry alone has invested over $2 billion and paid over $20 billion in US federal, state and local taxes – while also supporting 410,000 plus jobs in America.”
He said this is only part of what India’s IT sector brings to the equation. There is also the economic value of the operational support provided to over 90 per cent of Fortune 500 firms and thousands of other American businesses. Indian IT firms make their US customers more innovative, competitive, primed for new market, and eager to expand jobs.
American customers benefiting from these services encompass every corner of commerce and size of business, he said.
According to the report, California, Texas, Illinois, New Jersey and New York are the top five American states where Indian IT companies have supported direct jobs.
“Indian tech industry paid over $20 billion in taxes to the US treasury between FY 2011 to FY 2015E,” it said.
Indian tech industry made investments of more than $2 billion between FY11 and FY13, saving many jobs in the country.
“Leading Indian tech firms touched over 120,000 American lives through corporate social responsibility activities between FY2011-13,” the report said.
“Indian tech industry contributed over $375 million between FY 2011-15E to the US Treasury including helping America secure its borders,” it said.
Nasscom noted in the report that due to skill shortages, unemployment in the US tech sector is historically lower than the national average.
Responding to allegations that foreign tech workers are hindering employment opportunities of local professionals, the report said the fact is unemployment of tech professionals is half as compared to the national average.
On the allegation that foreign talent is being hired at lower salaries, the report said Indian tech industry pays equivalent wages to the US national and foreign worker.
The current shortage of skilled talent is expected to continue to grow and result in shortfall of 445,000 computer professionals by 2022, it said.