New Delhi: Terming the passage of a US Federal Law barring outsourcing of government contracts to other countries, including India, as "unfortunate and unwarranted", the Confederation of Indian Industries (CII) expressed the hope that the US President would reconsider it before signing.

"This is unfortunate and unwarranted. Although normally such provisions are not changed, perhaps the US President would reconsider this before signing the Bill", Anand Mahindra, president, CII, said in a statement.

"The CII believes that India is taking examples from the US and other developed countries on its path of liberalisation and reforms. However, such anti-liberalisation measures when adopted by developed countries, particularly the US, which target developing countries would lead to greater protectionism and thus impact global trade flow," he said.

Observing that domestic American politics may have resulted in the passage of this law, Mahindra said this is particularly unfortunate since studies in the BPO (business process outsourcing) sector have shown that the company which outsources gains much more than the company to which it is outsourcing.

"Since the Senate ban is on US Government contracts, the ultimate loser is the US taxpayer who will now pay more for Government services," he said.

The CII said the US has pressed India to accede to "Singapore issues" in WTO negotiations that includes transparency in Government procurement and no special treatment to domestic suppliers but this latest move by USA shows a discrepancy in its own stand.