H-1B visa fee hike hits IT funds; investors urged to stay long-term

Fee hike could accelerate offshore delivery, improve competitiveness; AI adoption, re-skilling initiatives expected to provide medium-term growth opportunities

The imposition of a one-time $100,000 fee on each new H-1B visa application by the US administration has unsettled investors in information technology (IT) funds. These funds are down 11.4 per cent year-to-date. Altogether, 32 schemes currently manage ₹47,569 crore. Experts caution against knee-jerk reactions.

 

Limited impact 

The steep increase in H-1B costs will raise operating expenses for Indian IT firms with significant US exposure. “Around 60–65 per cent of large IT company revenues come from North America, with many projects reliant on visa holders,” says Rahul Bhutoria, director and co-founder, Valtrust.

 

Margins of firms heavily dependent on