Why Trump's tariffs could make the apps on your phone worse

Core Viewpoint - The imposition of a 50% tariff on most Indian exports by the US could have significant second-order effects on the IT services sector, potentially leading to project delays and reduced IT spending by US clients [3][4][5][6]. Impact on IT Services - Major Indian software service providers like TCS and Wipro are already experiencing project delays as US clients adopt a cautious approach due to the tariffs [4]. - The new fee of US$100,000 for H-1B skilled worker visas adds further uncertainty for Indian IT professionals [4]. - Tariffs do not directly affect software services but can lead to reduced discretionary IT spending in affected industries, impacting outsourcing contracts [5]. Global Implications - Nearly 60% of the world's leading companies outsource their IT projects to India, making the country crucial for global digital infrastructure [6]. - Delays in IT projects due to budget squeezes from tariffs could lead to slower upgrades and glitches in consumer-facing applications, affecting users globally [8][9]. Consumer Experience - Consumers relying on applications managed by Indian software providers may face longer wait times and system glitches as US organizations cut back on IT spending [8][9]. - A past incident highlighted how a global outage caused by a US cybersecurity firm affected consumers worldwide, illustrating the interconnectedness of digital services [9]. Adaptation Strategies - Outsourcing firms may adapt to budget constraints by reallocating tasks, altering delivery timelines, or establishing local offices to minimize service interruptions [12][13]. - Research indicates that resilient firms can shift work to backup locations during disruptions, ensuring continued access to services [12]. User Expectations - End-users of software applications exert pressure on companies to deliver high-quality, glitch-free experiences, which in turn affects outsourcing partners in countries like India [15]. - Tariffs influence client budgets and outsourcing contracts, potentially delaying app updates and causing operational issues for end-users [16].