WASHINGTON : A growing number of economists and politicians fear that outsourcing of jobs to low paid workers in developing countries such as India and China could deprive the United States of tax revenue, damaging the fiscal health of the country, the Associated Press (AP) reported.

Although such concerns were dismissed as far-fetched or naive by those who favor outsourcing, some tax experts were quoted as saying that the shipping of hi-tech jobs to countries such as India and China is shrinking the U.S. employee tax contributions, resulting in state budget shortfalls.

Others said outsourcing could erode already-strapped Social Security, Medicare, workers’ compensation and other payroll-deduction funds more quickly than anticipated, the report said, adding that few researchers have studied outsourcing potential drain on public coffers.

“Here’s the big reason why tax revenues are declining: All these jobs are leaving the country,” John McGowan, professor of accounting at Saint Louis University, was quoted as saying. “We need to start talking about this problem and not just blithely saying, ‘Free trade is the solution’ just because it boosts corporate profits and Wall Street likes it.”

Cynthia Kroll, senior regional economist at the University of California at Berkeley, said outsourcing could jeopardize U.S. dominance in emerging fields such as genetics and nanotechnology.

According to her estimate about one in nine jobs nationwide ---- one in six in Silicon Valley ---- could be vulnerable.

“If (research and development) is coming out of India, will the next wave of growth bypass us entirely?” Kroll was quoted as saying. “We need to pay attention to what India and China and these other countries are doing to get these new rounds of investment.”

Indian computer programmers earn roughly one-sixth the $61,000 U.S. average, and Chinese programmers earn even less, the report said.

Given the disproportionately low labor costs abroad, tinkering with tax codes won’t save many jobs, Timothy McCormally, executive director of the Tax Executives Institute, a trade group for tax experts, was quoted as saying by the AP.

More than two dozen states have sponsored legislation to ban outsourcing of government contracts. However, Silicon Valley executives are urging politicians to avoid such legislation.