With majority of business for the Indian IT sector coming in from the US market, there is both concern and joy for the sector because of the US presidential elections result. One thing is sure: the new Donald Trump regime in the US is expected to remain vocal about ‘America First’. Its policies around visa regulations and offshore IT engagements are likely to reflect on the Indian IT services in the short term.

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During Trump administration’s first term, Indian IT sector reshaped itself, fostering resilience and adaptability. H-1B visa restrictions led Indian IT companies to pivot to US hiring, creating over 1,75,000 jobs by 2019 and expanding local investments. This shift, though challenging, strengthened the Indian IT sector’s ability to meet client needs onshore, while growing demand for digital transformation in North America provided opportunities for Indian IT firms to lead in modernisation and innovation efforts.

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“We may see mixed effects on India’s economy. Stricter visa rules could impact Indian IT professionals in the US, but his push to reduce reliance on China might open doors for Indian industries like tech, pharma, and manufacturing. Meanwhile, the growth of American Global Capability Centers (GCCs) in India is likely to continue, as US companies increasingly invest here for skilled talent and strategic offshore operations,” said Neeti Sharma, CEO, TeamLease.

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Of late, the Indian IT industry has been investing significantly on building local delivery capabilities in the US, hiring locals and diversifying its client portfolio by going beyond North America. While the dependence on H-1B is not going to go away, they are better-prepared for the nuanced policy shifts that might take place.

“The good news is that Trump’s new administration is likely to bring in a significant focus on its economy and show changes on the ground. Businesses need cost advantages to remain competitive and talent for deploying the latest technologies. India is extremely well-poised to fulfil these two needs. Hence, I can imagine many more GCCs being set up in India by the US companies to leverage the talent pool available in India and leverage the cost advantages,” said Aditya Narayan Mishra CEO and MD, CIEL HR.

“Secondly, we expect the CIOs (Chief Information Officers) and the boards of many large and mid-sized companies in the US untie their purse strings to deploy the latest tech and thus, a quick pick-up in new orders for our IT services companies. This shift could drive accelerated development of tech hubs in India, fueling growth in emerging tech fields like artificial intelligence, machine learning, cyber security, and cloud solutions.”

Experts with whom THE WEEK spoke to further pointed out that Trump’s win is expected to strengthen the US economy and the dollar, both of which are very beneficial to the IT industry in India. “The possible tax cuts by Trump for domestic production or services would ease pressure on pricing as well as budgets. H-1B visas and the likelihood of dwindling numbers on that will not hurt the IT services given the wide acceptance of remote delivery and that of GCC growth in India. Hence, Trump’s win is certainly more favourable to India on IT industry or Services,” said Subramanian S., founder, president and CEO of Ascent HR.

Many industry stake holders are also positive about the business intent that Trump is known for, the impact for IT industry, which could be a benign regime, particularly for higher value-added skills. Besides, Trump regime needs India to open up some of the sectors that are not open for trade, and so, India might have to open those sectors as well. 

Mitsubishi Electric Group company Climaveneta Climate Technologies (CTT) is set to invest Rs 400 crore in its manufacturing facility near Bengaluru to increase its market share in the Indian chiller market. Though currently its production is predominantly targeted at the Indian market, the company plans to double its capacity by 2030 and scale up exports to nearby regions.

The company presently has an order book of over Rs 500 crore and is targeting to double the annual order intake in the next five years. “Our chiller systems (40 per cent) is dominated by the data centres where the demand for the chiller system is growing phenomenally. Our current capacity from our factory here is around 1,200 chiller systems per annum, but we aim to double it in the near future to 2,400 systems depending on the traction we get. Currently, we employ close to 300 people but plan to take it to 600 by 2030,” Anil Dev, chief executive officer, CCT India, told THE WEEK.

The plant will manufacture central air-conditioning equipment such as screw chillers, magnetic levitation technology chillers, scroll chillers, conventional centrifugal chillers, high-precision AC units, and heat pumps for HVAC application. CCT has many customers in India, including global data centre companies, multinational hotel chains, health care establishments, malls, multiplexes, commercial projects of real estate developers, corporate groups and industrial applications.

“Reliable cooling systems are essential to prevent equipment failures in data centers. We are targeting the high demand from the data centers for our systems in India. This chiller market is concentrated largely in West India (Navi Mumbai), followed by Chennai, Bengaluru, Hyderabad, Pune and Kolkata. We had started the factory in 2020. Our facility will also manufacture different ranges of central air conditioning equipment for both domestic and international markets. We will always strive to bring efficient technologies to the Indian market and pursue ethical growth by giving the highest priority to sustainability and protection of the environment,” said Dev.

As per Masafumi Ando, chief executive officer, Mitsubishi Electric Hydronic and IT Cooling S.p.A, the group is targeting 2050 for achieving complete carbon neutrality and Climaveneta India will play a major role in this plan. “Europe and many developed countries are phasing out refrigerants that have global warming implications and hence alternative technologies are the need of the hour. Through our solutions we aim to ensure zero percent ozone depletion,” remarked Ando.

Mitsubishi Electric Corporation specialises in the manufacture, marketing, and sales of electrical and electronic equipment used in information processing and communications, space development and satellite communications, consumer electronics, industrial technology, energy, transportation and building equipment. The company recorded consolidated group sales of 5,257.9 billion yen ($34.8billion) in the fiscal year ended March 31, 2024.

Mitsubishi Electric in India offers products and solutions for air conditioners, factory automation, and industrial systems, semiconductors and devices.

Just as president-elect Donald Trump was being voted in on a platform of higher tariffs for China, US businessmen were striking deals thousands of miles away at Shanghai’s biggest trade fair.

Dynamite, a family-run pet food business with 12 stores in Idaho, signed $1mn in orders from Chinese company Pawberry — part of a stream of agricultural deals between the two countries this week that have so far amounted to $711mn.

“Every so often you meet someone in business you just click with — we understand each other,” said Joshua Zamzow, chief executive Dynamite, of his business partner at Pawberry. “He understands his market, and he’s taking the products that fit for the China market and just blowing them up . . . sales have begun to explode.”

But for businesses large and small, as election results flowed in from Georgia to Pennsylvania, it soon became clear that the wider relationship between America and China was entering a new era of uncertainty. Trump campaigned on a platform of higher tariffs — 60 per cent on Chinese goods — after a first term in which he launched a trade war that is still raging.

The US election this year coincided with the annual China International Import Expo, launched by Xi Jinping in 2018 and part of the government’s attempts to position itself as open to foreign business. This year it attracted thousands of companies — including more than half of the Fortune 500 — seeking to take advantage of China’s consumer market despite a tough economic backdrop.

Daniel Benefield, a representative of Rad Beverage International which was marketing products from Texas whiskey distillery Giant, said ahead of the result that he hoped his bourbon products would fly “under the radar” of any further escalation given their low market share.

“When you bring in a big percentage of a certain commodity, that’s your target. That’s why Australia got hit big time with the wine, that’s why Europe’s getting hit big time with the cognac.

“They sent soybeans back to the US, even though it was on the water,” he added, in reference to Chinese restrictions on the agricultural product that forms part of a series of retaliatory moves, most recently in response to European levies on Chinese electric vehicles. He added that his own imports — he gestures to a container of aged bourbon — were already subject to significant tariffs from China though he saw a “bright future” in the country.

Across the fair’s hundreds of stalls in a vast exhibition centre, there were relatively few Americans — a reflection of a wider decline that has seen foreign student numbers plummet, an exodus of US law firms from Shanghai and a general air of caution among US companies.

“US-China tensions [are] affecting the psyche of investment, there’s just no question about that,” said Allan Gabor, chair of the American Chamber of Commerce in Shanghai. “Some companies have taken some strategic decisions . . . but this is not generally the case,” he added, on the question of whether companies were leaving.

Longer-term planning in China now faces the prospect of further surprises. “The biggest concern for everybody is the unpredictability of Trump, and what comes out of Trump’s mouth and what actually gets executed,” said Kent D Kedl, former head of Control Risks in China and head of consultancy Blue Ocean Advisors. “The biggest risk to business is the unknown.

“The defining thing about China and the US is that it [China] is a domestic political issue in the US,” he added. “I have a number of friends who are now global CEOs because they came through [China], that is completely opposite now.”

Elsewhere in Shanghai’s exhibition centre, concerns over tariffs were not limited to US-China relations. “Probably they will [increase] tariffs . . . it will be harder for Brazilians to import to the US,” said Caio Livio Germano Alves, an exporter for beef company Bon-mart of a Trump presidency. By contrast, he expected to open more Brazilian beef sites in mainland China this month. “Our main market is China,” he said.

For Zamzow, Trump’s first victory in 2016 made business “harder” in China but “we found a way to still do business in a meaningful way”. “I think there was a lot of apprehension on behalf of Chinese people to invest in products and bring them in when they weren’t sure if he [Trump] was going to cut us off,” he said. “I think they realised and we realised it was OK.”

His relationship with his Pawberry partner, which came via a Taiwanese intern who was studying at Boise State University Idaho, also evolved. “He came to Idaho, and we went shooting guns, that was something he’d never seen before but it’s an Idaho cultural thing,” he said. “If you walk around this building, there are many business relations that started the same as ours, that today both parties are very, very wealthy, big corporations, but it started as friends”.

Throughout the building in Shanghai, even amid breaking news of the election, the focus was often far removed from politics. “For business people, we care about our basic living,” said one carpet salesman from Kashmir, who regarded China as “friendly” despite trade tensions between India and the mainland that echo strained relations with the US.

“In this room, it’s just business,” said Zamzow, who added that in his lifetime “almost no presidents ever do anything”. “We just want to make good products and buy good products and sell good products. The rest of it, it’s TV.”

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Prabowo Subianto is kicking off his first foreign tour as Indonesia’s president with a visit to top trading partner China, underscoring Beijing’s importance to south-east Asia’s largest economy.

Prabowo, who took office three weeks ago, will visit Beijing from Friday to Sunday and hold talks with China’s President Xi Jinping at the start of a five-country trip that will also include the US and UK.

Prabowo has yet to set out his diplomatic priorities or strategy, but has made clear he wants Indonesia to play a more active role in international affairs. China was also his first overseas stop after he won Indonesia’s presidential election in February.

Muhammad Zulfikar Rakhmat, director of the China-Indonesia Desk at the Center of Economic and Law Studies, said Prabowo was being pragmatic in prioritising Beijing.

“The visit indicates that China will be an important partner for Prabowo, especially for him to fulfil his economic promises,” he said.

Prabowo has vowed to boost annual economic growth to 8 per cent from about 5 per cent, a target economists have said will require increasing foreign direct investment.

China, Indonesia’s second-biggest source of FDI, was instrumental in helping Prabowo’s predecessor Joko Widodo to meet his economic goals by investing heavily in flagship projects and economically important sectors such as metals, mining, and infrastructure.

Chinese companies have pumped billions of dollars into Indonesia’s nickel industry as Jakarta sought to develop its reserves of the metal critical to steelmaking and electric vehicle batteries. Beijing also funded a $7.3bn high-speed rail line — Indonesia’s first — between Jakarta and Bandung as part of its $1tn global Belt and Road infrastructure initiative.

Prabowo has vowed to maintain Indonesia’s long-standing policy of international neutrality and analysts said he was seeking to balance his visit to China by immediately following it with a trip to the US, where he is expected to meet President Joe Biden and possibly president-elect Donald Trump.

Prabowo will then go to Peru for a meeting of the Asia-Pacific Economic Cooperation forum, to Brazil for a G20 summit and finally to the UK, where he will meet Prime Minister Keir Starmer.

“We must negotiate, explore existing potential, and resolve crucial and strategic issues with these countries, which are part of very important economic blocs. It is very crucial to the survival of our economy,” said Prabowo in a statement this week.

The president did not say whether one of those issues he planned to discuss would be China’s increased assertiveness in the South China Sea, where Beijing’s sweeping territorial claims appear to overlap with Indonesia’s exclusive economic zone.

Last month, the Indonesian coastguard said it had driven Chinese coastguard ships out of waters under Jakarta’s jurisdiction, where it said the vessels had been disrupting resource survey work.

Prabowo has previously called for a peaceful resolution of the South China Sea disputes.

Prabowo, who has said he wants to be “friends with all countries”, is keen for the world’s fourth most populous nation to play a more influential role in global affairs than it did under Widodo, who had a more domestic focus.

In the first three weeks of his presidency, Indonesia has announced that it will join the Brics grouping of major emerging economies that includes China and Russia and launched its first joint drills with the Russian military.

As defence minister in Widodo’s government, Prabowo last year proposed a demilitarised zone and a UN referendum to end the conflict between Ukraine and Russia, a plan rejected by Kyiv. This year, Prabowo said Indonesia was willing to send peacekeeping forces to Gaza.

“Indonesia under Prabowo will be more willing to work with everyone. Not just with Russia or China, but also the US, France and others,” said Evan Laksmana, senior fellow at the International Institute for Strategic Studies. 

“Prabowo himself will be Indonesia’s chief diplomat. What we will see is a more hands-on, active personal touch to foreign policy and international engagement.”