‘US visa curbs to spur IT layoffs’

Nearly 86 per cent of the H-1B visas issued for workers in the computer space go to Indians and this figure is now sure to be scaled down to about 60 per cent or even less, the paper said. Remittances from the US would decline, hurting the balance of payment. World Bank data showed the US was the second largest source of remittance for India in 2015, behind Saudi Arabia, and about $10.96 billion, nearly 16 per cent of the total inflows, were sent to India. 

The industry chamber expects it to disturb the balance by 8-10 per cent. As the cost pressure would increase, aggravated by rising rupee leading to lower realisations, the Indian IT firms may be forced to displace work force. 

“In that case, the chances of layoffs are real,” said Assocham Secretary General DS Rawat. He said the IT industry apex organisations and the government need to work out a joint strategy to deal with the unfolding situation. 

In the last three months, the Indian currency has gained by at least five per cent against US dollar, reducing net realisations for software exporters, among other export-oriented sectors. 

According to the Assocham paper, the reverses resulting from the tightening of the H-1B visas would force IT giants to effect fundamental changes in their strategies in terms of hiring, salaries, jobs, impacting employees in India too. 

With Britain already hiking the minimum wage requirement to euro 35,000 for tier II visa immigrants, this latest move by the US will act as a definitive dampener to the Indian outsourcing industry.