Indian IT Firms to Be Hit as US Senators Seek to Cut H1-B Visas

Indian IT firms depend on the H1-B visas to execute contracts in the US. (Photo: Reuters)

In a development that could hurt Indian information technology services players, two US senators have proposed a Bill to prune the number of H-1B visas issued by that country by 15,000. The US allows a maximum of 65,000 H-1B visas annually and an additional 20,000 for those who have completed higher education in the STEM (science, technology, engineering and maths) fields.

Companies such as TCS, Infosys and Wipro depend heavily on H1-B visas to execute contracts in the US. 

Senators Bill Nelson of the Democratic Party and Jeff Sessions of the Republican Party have also said applicants for H-1B visa will be prioritised based on the salary they earn — the higher the salary, the higher the chances of getting an H-1B visa.

Companies such as Tata Consultancy Services (TCS), Infosys and Wipro depend heavily on these visas to execute contracts in the US. In addition to H-1B visas, Indian IT firms also use short-term L-1 visas.

By cutting the number of visas available each year and requiring those visas be given to the highest-wage earners first, this Bill directly targets outsourcing companies that rely on lower-wage foreign workers to replace equally-qualified US workers.

Bill Nelson, US Democratic Senator

A separate legislation filed by Nelson and a few other senators would require employers to prove that they first tried to hire an American employee before hiring a foreign recruit.

Nasscom President R Chandrashekhar has said in the past that the organisation has expressed its concerns at length to the authorities in the US, both lawmakers and those in the administration.

We remain hopeful these concerns will be taken note of especially in the context of the deepening strategic and economic partnership of both the countries.

R Chandrashekhar

For several years now, Nasscom has lobbied against any proposed legislation curtailing the number of H-1B visas.

The latest round of measures by US lawmakers is the second in a span of one month. In November, two senators — Chuck Grassley and Dick Durbin — had introduced a Bill that would require all companies that want to hire workers under the H-1B visa to first try to hire US citizens.

In addition, firms that employ more than 50 people and have more than half of their staff on H-1B and L-1 visas would be barred from hiring new workers on H-1Bs.

One senior IT executive said the pressure on H1-B regulations tends to build up around the time of the US presidential elections.

The IT industry’s toughest challenge has been the proposed Immigration Bill, which contained stifling provisions on the use of H-1B visas. This Bill has been approved by the US Senate sans some of the harmful provisions though it is yet to be passed by the US House of Representatives.

(With inputs from PTI)