Phaneesh Murthy, prime mentor of PriMentor, Inc. and former worldwide sales head of Infosys Technologies, on Thursday termed the New Jersey bill to bar outsourcing software from state enterprises to countries like India as "repressive", but pointed that Indian companies were getting "paranoid" on this issue.

"One of the most respected things in the United States is the complete freedom in movement of work. The New Jersey bill leaves a bad taste and is repressive. Having said that, we are also trying to create a sense of paranoia," Murthy told reporters in Bangalore.

On the proposed move to bring a similar bill in Washington state, Murthy, who is based in Fremont, California, said it was due to lobbying from Washington State Technology Establishment (Washtest), a workers union controlled by contractors for IT firms.

He said the reasons cited by Washtest to seek a ban even from private companies was "emotional and had little base".

Murthy said he would be surprised if the bill is passed as there is bound to be protests from US private enterprises, if there is any law that restricts their work.

He said this was the first time Indian IT firms have started realising that "replacing jobs" in the West would give rise to concerns there.