Wipro expects to have more than 50% of its staff in the US to be local employees during the first quarter of FY18, a trend followed by an increasing number of Indian technology companies to combat a rising protectionist stance in America and become visa independent firms.
The IT major will also be adding two more major multi-client delivery centre in Mountain View, California. They have also added another centre in Michigan. The US accounts for around 55% Wipro’s revenues. Wipro, which has provided a disappointing guidance of flat to -2%, for the first quarter of the fiscal, may end up becoming the first major Indian software firm to report a decline in revenue growth, in many years.
Wipro CEO Abidali Neemuchwala said, “FY17 saw immense progress in localization in all our key markets. We have been significantly investing in US, in terms of increased hiring, setting up delivery centres and focusing our sustainability initiatives specifically in the area of education.”
Given the protectionist stance of the US government under President Donald Trump, increasing number of Indian IT companies have announced plans of increasing their local hiring in the US. This also comes in the backdrop of new regulations governing the H-1B visa programme, which is likely to hurt the Indian IT companies.
Its rival Infosys also has plans to focus more on local hiring in the US which include setting up of development and training centres. U B Pravin Rao, COO, Infosys during a recent conference call said, “We are closely monitoring the overall situation with respect to visa… in the last 24 months, we have focused on increasing our presence in the US with a lot more local hiring.” The North American market accounted for over 60% of Infosys’ $10.2 billion revenue in the 2016-17 fiscal.
Tata Consultancy Services’ (TCS) CEO Rajesh Gopinathan in a recent investor call said that the company is unperturbed by the possible H-1B visa restrictions and it is willing to make “changes accordingly.” TCS recruited over 11,500 people outside India during 2016-17, including graduates from engineering and B-schools in the US, as it ramps up local hiring in offshore markets to tackle visa-related challenges.
On the various new regulations governing the movement of technology professionals especially through H-1B visas, Neemuchwala said, “Mobility is essential to global trade and should not be discriminatory.” He also added that they are closely engaged with Nasscom and government to deal with these new regulations.
There is a strong perception in the US that Indian IT firms account for majority share of the 65,000 H-1B visas given out annually. However, Nasscom has rebutted these allegations by stating that Indian IT firms account for less than 20% of the total H-1B visas.