The US has introduced a new law which has put the $250 billion (Rs 22039250000) Indian IT industry in tension. The bill called the Halting International Relocation of Employment (HIRE) Act was introduced in the US Senate earlier this month by Ohio Republican Senator Bernie Moreno. The proposed law provides for heavy fines on US companies that outsource jobs abroad. The move is aimed at encouraging companies to hire locally and reduce dependence on foreign workers. India has been a hub for IT outsourcing for a long time Since India has long been a hub for IT outsourcing and related services the bill has raised concerns in the Indian IT industry which is heavily dependent on US clients for revenue. The bill has been introduced at a time when US-India trade relations are already under strain due to US President Donald Trumps tariffs. What is HIRE bill? The HIRE Bill contains three key provisions designed to discourage the outsourcing of work overseas. 25 percent outsourcing tax: The bill proposes a 25 percent tax on outsourcing payments defined as amounts paid by a US company or taxpayer to a foreign company or individual whose services ultimately benefit consumers in the US. Restrictions on tax deductions: This would also prevent companies from deducting outsourcing expenses from their taxable income increasing the financial burden of sending work abroad. Domestic Workforce Fund: Revenue from the outsourcing tax will be directed into a newly formed Domestic Workforce Fund. How will it affect Indian companies? India has been the biggest beneficiary of outsourcing over the past three decades. According to industry estimates leading Indian IT companies - Tata Consultancy Services (TCS) Infosys Wipro HCL Tech and Tech Mahindra - derive 50 to 65 per cent of their total revenue from North American clients. These companies provide a range of services including software development systems integration cloud management and business process outsourcing (BPO). These companies also serve many Fortune 500 companies such as Citi Group JP Morgan Chase Bank of America Pfizer Microsoft and Saint Gobain.