In the proposed Section 535 of the Consolidated Appropriations Act of 2004, US federal agencies will be able to purchase IT products and services from other countries, exempting them from the Buy American Act.
It also enables agencies to purchase imaging peripherals and other security tools and services from foreign countries. However, these terms are only going to be brought into effect if buying foreign IT is proven to be in the public interest.
The news comes at the same time the Indian software and services industry has begun to fight back against proposed bans by the US on offshore outsourcing. Currently some 14 states are attempting to pass legislation preventing the outsourcing of IT services and back-office processing work offshore.
In one high-profile case last November, the State of Indiana gave into protests from local workers and unions, pulling the plug on a $15.4m contract with India’s largest exporter of software and services Tata Consultancy Services.
Despite this, the US federal sector is only expected to account for 2% of the Indian offshore market, but the negative protectionist sentiment in the US threatens to spread to other countries such as Australia and the UK facing similar concerns.
This article is based on material originally published by ComputerWire
