The proposed changes in the norms of the visas will cause a lot of stress in the indian it scenario specially where they are highly dependent on their visas.
The companies having higher workforce under the category of H1-B visa will suffe the same, in this category unfortunately, most of Indian it companies will fall.
The amount of the fee these companies will have to pay would be much higher. Any employer which have more than 50 employees and have more than 30% but less than 50% will fall under category H1B or L1.
The employer needs to pay $5000 for employee who is an extra for either of the standard. The employer which has more than 50% of the employees with H1B or L1 will have to pay $10000 fee.
This is going to effect companies like TCS, WIPRO and Infosys. But will be useful in case of IBM, Dell etc which are US based. The proposed reform to the H1B visa standards were under the Senate’s comprehensive bill. It has the potential to cast a profound impact on the outstanding industry.the US government has accused Indian it companies of using the visas unfairly to send the employees from india at a lower cost, which impacts job creation in US.
Most IT companies have said this would impact margin by 20 to 30 basis points and they would counter it by increasing hiring in US. Also it clears the opportunity of the local US players to get sub contracting from the bigger players.
The impact on the revenues of the big companies such as Cognizant, TCS will give birth to theneed of change of business model IT providers that need to evaluate the options such as acquisition and larger presence in smaller US cities. Proportion of work may be needed to increase from 60 to 70% to 80%, they might need to employ local employees or perform small acquisition to get the employer strength needed.
Dealing with the possible solution of lobbying Nasscom might not be able to pitch in the favour of Indian IT industry as the US govt. Have, in any case anticipated the strategic move discussed above, further the newer technologies like Bigdata, analytics and healthcare are emerging in US and US govt. would like to create a parket for its own production. The unemployment rate in US rules out all possibilities of Nasscom, lobbying for Indian IT industry.