India Conveys concern to United States on proposed changes in H1B visa norms

Greyhound Research estimates that average margin hit for an IT services provider will be 5-10 per cent, depending on the total base of employees now on H1-B visas.

With a proposed Executive order and three bills introduced in US Congress, India has conveyed New Delhi’s “interests and concerns” to Washington, even as it braces for a cut in the number of H1B visas for foreign technology workers. Both of them are used extensively by Indian companies.

Level-3 employees who would be of assistant manager rank are drawing $72,000 to $84,000 per annum, followed by level-4 (managers and above) who are drawing $ 90,000 to $ 1.2 lakh per annum.

The draft of an executive order from United States president Donald Trump reportedly seeks to overhaul the work-visa programmes technology companies depend on to hire tens of thousands of employees each year.

According to a report in Economic Times, various Bangalore-based recruitment firms have confirmed that jobs-related queries by US-based professionals have doubled after President Trump announced his policy stance at his inauguration. It had pre-opened at 9881.89 points and went to a low of 9401 only to close at 9586.34, which is 2.96 per cent lower.

India’s biggest private sector employer, plunged more than 5% on Mumbai’s stock exchange, while other top firms like Infosys (INFY) and Wipro (WIT) fell by more than 4%.

On January 24, Democratic Congresswoman Zoe Lofgren, whose district encompasses much of Silicon Valley, introduced a new bill that sought to reform the H-1B program. “The risks to the IT services sector include an increase in cost per professional, more local hiring and a disruption in service continuity, which may have a negative impact on profitability of companies that are visa-reliant”, he told PTI.

Kumar, who has his own business in Chicago, said there is a huge need of IT workers in the US. However, the Bill is likely to be pass as the Republicans control both the Senate and House of Representatives of the Congress.

“All the major and medium companies have offices in the USA”, he said. “They should not leave any loopholes in the rules”, Mr Chandrashekhar said. If implemented, the reforms could shift the way American companies such as Microsoft, Amazon and Apple recruit talent and force wholesale changes at Indian companies such as Infosys and Wipro.

The Indian government appears to have taken notice of the reports but it is unclear if it’s going to escalate the matter as a diplomatic issue.

Forbes also said that the Bill will have a negative impact on the American firms but it will be beneficial for the Indian firms in the long run.

Among the provisions that needs to be considered as per Nasscom are, that the higher wage level would have ripple effects for many other industries including nursing, engineering, life sciences, and others.