The strict H1B visa rules imposed by US President will force Indian IT sector to create fundamental changes to their strategies in terms of recruitment, salaries and jobs, which could influence employees in India too. A report by experts suggested that Indian IT sector will face disruptions by way of higher costs and even some laying off work force back home because the rising rupee is aggravating the situation further for the technology export firms.
In the situation of increase in cost pressure, Indian IT companies may be forced to displace workforce. So the chances of layoffs are real. The 60% of the business of Indian IT companies comes from North America. According to a report, the 86% share goes to Indians depending on the number of H1B visas in the computer segment. The former CEO of HCL Vineet Nair said after this decision of Donald Trump there will be two cases, either the visa of IT engineers that won’t get renewed will impact the domestic market with oversupply or due to the increase in cost the margin of the companies will decrease.
H1B visa curbs could also affect Indian external sector economy. Remittances (money from America to India) from the US would decline hurting the balance of payment. According to the World Bank statistics, of 2015, US was the second largest source of remittance for India in 2015 with $11 billion – nearly 16 per cent of the total inflows. So there will be a disturbance in remittances by 8-10 per cent.
So no wonder H1B policies implemented by Trump is definitely not a good sign. H-1B visa programme as ordered by the US President could come up with recommendations that could have “far reaching consequences”. Be ready to face the consequences.
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