Donald Trump
India’s major IT companies have suffered a major setback due to a sudden huge increase in H1-B visa fees in the US. Under this policy implemented by the Trump administration, the cost of an H1-B visa application has now been around $ 100,000 (about 83 lakh rupees), which is about 10 times more than before.
Due to this decision, TCS, Infosys, Hcltech And companies like Wipro will now have to spend additional 150 to 550 million dollars (1,200 to 4,500 crore rupees) in the next few years. This cost will directly affect their earnings and margins.
Heavy increase in delivery cost
About 85% of Indian IT companies have revenue from the US market. At the same time, 3-5% of their employees are employed there. When such a large number of people ONSITE ie Work in america If they do and their visa costs suddenly increase so much, then obviously there is a huge increase in the total cost of delivery.
Offsoring will increase, but there are limits
To avoid rising costs, companies will try to do more work from cheap places like India, that is, offshoreing will increase. But it is not possible to handle every work from India. Especially for special skills like AI, Cyber Security, Cloud Architecture, it is necessary to send ONSITE to employees. In such a situation, they will have to pay this huge visa fee in compulsion.
Local appointments and all contracting increase
Due to such huge fees, companies are now considering appointing more and more local people or doing all contracting with American companies. However, this is also not a cheap option and it will also affect the profit.
Previously, an H1-B visa had a total cost ranging from $ 7,500 to $ 10,000, including premium processing and legal charges. Now the same cost has reached $ 100,000, which is a huge financial burden for companies.
New deals and projects may be affected
Projects worth about $ 13 billion are to be renewed by July 2025. In such a situation, this policy can become a big headache for companies. They will now have to decide whether to carry forward the projects with such an expensive visa will be beneficial or not.
IT industry estimated to fall in earnings
According to an ET report, this new policy can have an impact of 7-15% on Ebitda of Indian IT sector. For example, TCS had a H1-B visa of 7,000 employees in FY23. If they are renewed in 2025, then every application will cost an additional $ 90,000, which will affect the profits of TCS 7-8%.