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Know how H1B visa restrictions will impact Indian IT industry

ViewsHeadlines Desk,

Indian IT companies are a worried lot right now. Donald Trump has been claiming that he will force the companies in the US to hire more from the US and not from outside. He has also been talking about getting tough on visa.

Ever since Donald Trump came to power in the US, from where Indian IT companies drive most of their work and revenue, these IT unicorns are wondering how they will survive the latest visa rule change, particularly regarding the H1B visa.

There is no denying that many Indian IT engineers who go to the US, working for these companies, would have never imagined to see their economic condition transform so drastically in a matter of merely years. Hundreds of thousands of IT engineers have seen their lives transformed completely by the mere dint of luck that took them to the US while working for Indian IT companies.


There are fears that India’s close to $150 billion IT industry may slow down substantially in the coming days if Trump administration tightens rules on hiring skilled foreign workers. It must be kept in mind that the IT companies in India heavily depend on exports to the United States and almost the entire revenue comes from there.

The top leadership of these IT companies is a worried lot ever since a bill was introduced in the U.S. Congress earlier this January. The bill asked the US government to raise the minimum salary for positions granted under the H-1B visa scheme from $60,000 to $100,000 per year.

There is no denying, that it will make enormous difference for the Indian IT companies that are not really very good paymasters. IT companies are among the biggest beneficiaries of the H-1B visa program, which allows foreign professionals to work in the United States. Sponsors of the bill say it is designed to close loopholes in the high-skilled immigration system being used by some companies to import cheap foreign workers.

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Now the Indian companies are trying to recruit the US talent as they believe that some sort of action will be taken by Trump administration in this regard. In recent decades, Indian software firms emerged on the front lines of the global outsourcing industry by using the country’s large pool of trained, low-cost engineers to beat the competition. While some are deployed to client sites overseas, millions of others work in India’s tech hubs, such as Bengaluru. But this core business model is under threat if immigration and visa policies turn restrictive in major markets such as the United States.

Experts believe that as Indians working on H-1B visas earn less than the $100,000 per year minimum proposed under the bill that has been introduced, the Indian companies are worried.

Despite hiring the American employees at apparently higher wages, they don’t expect them to be amenable like Indian workers. Industry insiders point out that Indian technology employees are flexible and can be easily moved from city to city. Accustomed to the Indian work culture, they often work long hours to coordinate with teams at home without extra pay. Those advantages will not be available with American hires.

Top IT companies in the country are worried over the growth prospects. Many have already stopped hiring fresh talent while others are giving pink slips to their employees. In the meantime, India’s IT watchdog, Nasscom, is reportedly planning to send a delegation to the United States in the coming weeks to highlight what it says is the contribution made by Indian technology companies to the U.S. economy. But only time will tell if it will be of any use, at least in the short term.

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