NEW DELHI: After China, India has raised the banner of free trade against the growing protectionism in the  US. 



Reacting strongly to US president Barrack Obama's proposal to abolish tax cuts for companies that outsource work, finance and foreign minister Pranab Mukherjee said this would affect the Indian IT industry. 



In an interview to a TV news channel, Mukherjee said, "The IT industry will be affected due to the impact of financial meltdown...substantial number of Indian workers are there...we will have to address this issue...we are opposing protectionism, not only here but at every forum." 



Mukherjee said, "We can't just go for a country specific solution for such a problem...issue is that our IT industry will be affected." 



Obama in his maiden budget speech had said that companies outsourcing jobs to overseas destinations may lose tax benefits. This is a key provision of US law that allows American companies to pay less taxes for profits earned overseas. The plan, if put into action, would affect about 1,000 US companies. 



However, in the longer run, industry experts believe it would trigger the flight of companies themselves from the US. However, the US is yet to outline the ways to abolish tax breaks for the entities outsourcing jobs.