New H-1B rules unlikely to impact large Indian IT firms, says Nasscom head

Nasscom President Rajesh Nambiar says recent US H-1B visa changes will have little effect on large Indian IT firms, as companies have already boosted local hiring and are preparing for new rules

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Despite anxiety around recent changes to the US H-1B visa process, India’s large technology companies are unlikely to feel any major disruption. The industry has gradually reduced its dependence on the H-1B route, and the fresh rules do not significantly alter business plans, Nasscom President Rajesh Nambiar told The Economic Times.

 

According to him, companies have already shifted towards more local hiring, and have enough time to adjust further before the next visa cycle.

 

Minimal impact on big tech firms

 

Nambiar said the sector had been preparing for stricter rules for years. Firms have steadily lowered their reliance on H-1B workers, so the overall effect of these changes will be very small, he said.

 

A key clarification -- students already in the US on Optional Practical Training (OPT) extensions will not pay the proposed $100,000 fee -- has also eased concerns for companies and young talent.

 

In September, US President Donald Trump announced that new H-1B applications would soon cost $100,000, a huge jump from earlier fees of $2,000-$5,000. Another update to the H-1B lottery, which now gives preference to roles requiring advanced skills and high salaries, is expected to increase costs further.

 

Nambiar said that firms will continue using the H-1B route where necessary.

 

Beyond immigration rules, the global tech industry is undergoing a deeper shift driven by artificial intelligence. Nambiar noted that businesses are now focused on transforming existing employees to meet future needs. Skills that were valuable even a few years ago are becoming outdated quickly, he said, as AI-powered tools become central to operations.

 

He emphasised that India’s vast talent pool gives it a competitive advantage. Stronger collaboration between the government, universities and industry could help India emerge as a global centre for AI-driven capabilities, he added.

 

Startups, especially in AI, are feeling the pressure more sharply. Stricter visa rules and fierce competition for skilled workers in the US pose challenges. But many are coping by hiring locally, building partnerships, and relying on networks already established in the US.   

 

HIRE Act seeks to expand H-1B quota

 

Even as visa fees rise, there are parallel efforts in the US Congress to expand the number of foreign skilled workers allowed each year. Democrat lawmaker Raja Krishnamoorthi has reintroduced the High-Skilled Immigration Reform for Employment (HIRE) Act, which would raise the annual H-1B cap from 65,000 to 130,000.

 

Krishnamoorthi said the proposal aims to solve talent shortages while supporting US education. The Bill also removes the separate 20,000-visa limit for people with advanced American degrees and directs more federal funding toward science and technology programmes in schools.

 

India remains the biggest H-1B beneficiary

 

Indians continue to dominate the H-1B programme. Since 2015, they have received more than 70 per cent of approved petitions annually. From October 2022 to September 2023, 72 per cent of nearly 400,000 visas went to Indian applicants.

 

The programme has sparked criticism within the US. Commerce Secretary Howard Lutnick recently described H-1B hiring as unfair to American workers, while a senior US diplomat alleged that large-scale fraud exists in the system, claiming that 80-90 per cent of work visas issued to Indians were obtained through improper means.