US President Donald Trump issued a proclamation to suspend issuing of H-1B, H-2B, J, L, and other temporary work permits for immigrants until December 31, 2020. The proclamation comes into effect from 24 June.
Trump said, “it is aimed to provide employment opportunities to more than 20 million Americans who have lost their jobs in recent weeks due to the COVID-19 pandemic.”
“We have a moral duty to create an immigration system that protects the lives and jobs of our citizens,” Trump said.
Trump extended a ban on green card applications until the end of the year and suspended a range of “guest worker” visas that allow everyone from scientists and engineers to au pairs to work in the US.
H-1B visa is popular among Indian IT professionals, along with other foreign work visas for the rest of the year.
Impact on Indian IT Companies
According to the India Today report, Not good news for Indian techies because-
- Nearly 3-4 lakh H-1B visa holders are currently being employed by top tech firms in India and more than 60% of engineers in the Bay area are H-1B visa holders.
- Indian IT giants like TCS, Infosys, and others having offices in the US will suffer due to the move as they will now have to hire the local employees at a higher cost.
- The projects deliverability may be impacted by Indian IT services firms because of a shortage of talent.
- The suspension of temporary work visa permits is bad news for fresh engineering graduates from India seeking job opportunities in the US. They will not be able to secure a temporary US work visa permit for the rest of this year.
According to the Economic Times Report, few analysts also feel that H-1B visa suspension will not have much impact on Indian technology companies because-
- Indian IT majors like TCS, Infosys, Wipro, Tech Mahindra, and HCL Technologies have been reducing their dependence on visas in the last few years and hiring more people locally. An annual report of India’s largest IT services provider, TCS said that it has nearly 20,000 US nationals on its payroll.
- Analysts foresee a case for more offshoring of work in the sector in the next few months, given the impact of the COVID-19 pandemic and continuing travel restrictions.
- With work from home implemented at such massive scale post-COVID-19 by Indian IT vendors, borders might be losing relevance.
In the current scenario due to pandemic and international travel restrictions, there is no major harm on Indian technology service companies but in long term surely the H1-B Visas ban will impact Indian IT Companies.
