With US President Donald Trump set to sign a new executive order aimed at overhauling work visa programmes like the H-1B and L1, concern looms large over the fact that the move that will adversely hit the lifeline of Indian tech firms. A legislation has been introduced in the US House of Representatives which among other things calls for more than doubling the minimum salary of H1-B visa holders to USD 1,30,000, making it difficult for firms to use the programme to replace American employees with foreign workers, including from India. Now IT companies in Hyderabad are fearing worst as thousands of techies who are working in the US on H-1B visas will have to return, The Indian Express report said. Around 4 lakh software engineers work in 1,283 software firms in Hyderabad, and approximately 20,000 of them go to the US every year on H-1B visas. Every year 60,000 H-1B visas are issued of which approximately 54,000 visas are to techies. Unfortunately, thousand of them will be forced to return. As per the Industry captains, out of every 100 techies currently posted in the US, 95 will have to return if the new rule is imposed.
“Companies have already started listing who they will keep in US and who they will ask to return home. I think only critical resources persons and people at the level of vice-president or director would be asked to stay on-site while the rest of the staff who are mostly associate and senior associate level would have to return home. No company is going to pay $1,30,000 and keep more then one or two most needed employees in the US,” Sandeep Kumar Makhtala, president of Telangana Information Technology Association (TITA), said.
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“Hike in H1B visa cost will have significant impact on the financials…as Indian companies are major users of H-1B visa though they form very less part of the overall workforce (around 11-15 per cent),” brokerage firm Angel Broking had said. “Depending on the companies, they could easily witness around 60-70 per cent rise in the salaries of the H1B visa dependent workforce and hence have significant impact on the net profit of the companies,” it added.
While about 55 per cent revenue for Indian IT companies comes from the US, companies are already exploring South Africa, Australia, Canada, UK and some European countries for projects.
H1-B is a non-immigrant visa that allows US companies to employ foreign workers in speciality occupations that require theoretical or technical expertise in specialised fields. The technology companies go for it to hire tens of thousands of employees each year.