Indian IT firms slash H-1B dependence as US tightens immigration rules

Indian IT companies are reportedly cutting down on H-1B visas, hiring more locally in the US, as tougher immigration rules, rising costs, and AI-led changes reshape global outsourcing models

India’s top software services companies are steadily reducing their dependence on H-1B visas for US hiring, as immigration rules grow more expensive and complex, The Economic Times reported.

Why it matters

 

The move reflects how Indian IT giants are shifting delivery models — hiring locally in the US, nearshoring work, and adopting automation — while navigating political pressure in Western markets to safeguard local jobs.

 

In May, the United States Citizenship and Immigration Services (USCIS) said it had selected 120,141 applications for H-1B visas for 2026. This is the lowest number chosen since 2021. Even with this drop, the announcement sparked fresh debate, especially among supporters of Donald Trump's Make America Great Again (MAGA) movement. Many argued the figure was still too high and claimed the H-1B programme was taking away jobs from Americans. 

 

US Commerce Secretary Howard Lutnick and Florida Governor Ron DeSantis have strongly criticised the H-1B visa programme, calling it a “scam". Right-wing activist Laura Loomer also wrote on social media: "US workers are being replaced. 120,000 H-1B visas have been approved for 2026. Not good."

 

Indians continue to be the largest beneficiaries of the programme, receiving about 72.3 per cent of all H-1B approvals in recent years. For FY 2025, around 135,000 people were selected out of more than 470,000 applicants, with Indians again making up the majority.

 

The heavy reliance on H-1B visas is crucial for India’s IT industry. The programme gives access to major global contracts and management roles. Any cuts or restrictions could limit opportunities for Indian professionals and disrupt long-standing business models of large Indian IT companies.   

 

By the numbers

 

• The six biggest IT employers — Tata Consultancy Services (TCS), Infosys, HCL Technologies, Wipro, Tech Mahindra, and LTIMindtree — cut H-1B issuances by an average of 46 per cent over the past five years, according to US Citizenship and Immigration Services (USCIS).

• TCS remained an exception in FY25, sponsoring 5,505 visas, second only to Amazon, thanks to its 600,000-strong workforce.

• Global consultancies such as Accenture, Capgemini, Cognizant, and IBM reported a similar 44 per cent average drop in filings between FY21 and FY25, the news report said.

• In contrast, Amazon, Microsoft, Meta, Apple, and Google have stayed among the top sponsors, continuing to draw Indian tech talent.

AI labs join the fray

 

Research firms OpenAI and Anthropic also emerged as notable H-1B sponsors. OpenAI filed for 76 visas in FY25, up from 75 in FY24 and 11 in FY21. Anthropic backed 41 applications in FY25, USCIS data showed.

Big picture

 

• Indian IT firms are cutting visa reliance partly due to US protectionist sentiment but also because generative AI is reshaping outsourcing models.

• Meanwhile, US tech giants are doubling down on bringing Indian engineers onsite to scale AI products, deepening their reliance on specialised talent, the news report said.   

Immigration rule changes from September 2025

 

United States

• From September 2, nearly all non-immigrant visa applicants must attend in-person interviews at consulates

• Exemptions for children under 14, seniors over 79, and many renewals will largely end

• Categories like F-1 students and H-1B professionals will be affected

• The Department of Homeland Security also plans to replace the “duration of status” model with fixed stay periods, requiring extensions or reapplications

 

United Kingdom

• New restrictions will apply to asylum family reunifications

• Conditions include income thresholds, English skills, and settlement periods

• Judicial appeals will be phased out in favour of trained public panels to speed up cases

 

New Zealand

• Launching two new temporary visas: Global Workforce Seasonal Visa (up to three years) and Peak Seasonal Visa (up to seven months)

• From September 1, investors under the Active Investor Plus scheme with NZ$5 million can buy or build residential property without the previous six-month residency requirement

 

Australia

• From September 13, the Skills in Demand (Subclass 482) visa will lower its English language bar to vocational level (IELTS 5 in each band or equivalent in PTE Academic)

• The move aims to widen access for industries facing acute labour shortages