India should lower its tariffs, and gradually open its markets in order to provide a level playing field to the United States in the area of outsourcing, former US Trade Representative Carla Hills said on Monday.

"US has a strong sense of fairness and equity, and when US has opened its market on the average tariff of two per cent, another large country (India) keeping its market closed is not fair. Each one of us has political pain, I think the remedy is to gradually do the market opening," she said at a CII debate on outsourcing, in New Delhi.

She added that during the transition period, "adjustment" could be made. Countries like East and West Germany, which were closed, did not grow and keeping the market close was going to be bad for India.

Further legislation could be introduced to restrict outsourcing in US, she said. "I would expect a lot of ideas to deal with the taxes, to deal with other forms of regulation that would put limitations and propose limitations on outsourcing. You have to see whether they are passed in the long run."

Hills said she did not see the entire issue as an election agenda.

"I think the issue of outsourcing is going to be in US for a while...we have a political problem," she said.

"It is quite serious and is growing. Americans are losing their jobs in white-collar high-end jobs. But it is not just in one direction. We have 6 million jobs today which are based upon foreign companies coming to outsource," she added.