H-1B visas to local hiring: How IT majors prepared for US immigration curbs, Pg15

Key Highlights:

• The US Department of Labor suspended eight major technology firms, including TCS, Infosys, and Wipro, from the Permanent Labour Certification Programme (PERM).
• This program is a crucial step for employment-based green cards in the United States.
• Indian IT companies had proactively reduced their dependence on US work visas by increasing local hiring and establishing delivery centers closer to their markets.
• The Trump administration had previously tightened H-1B visa regulations and proposed significant fees on new H-1B petitions.
• Infosys and TCS stated they do not anticipate a material impact due to their limited use of the PERM program and localized workforces.

Detailed Insights:

• The traditional business model of Indian IT involved offshore client work from India and sending senior engineers overseas.
• Improved subsea cables and cloud infrastructure significantly reduced communication and data transfer costs, facilitating remote technology services.
• The COVID-19 pandemic accelerated client acceptance of offshore work models among global businesses.
• Historically, Indian IT companies maintained a 70:30 offshore-to-onshore employee ratio, projected to shift to 85:15 by FY27.
• Nearshoring to countries like Canada, Mexico, and Latin America has gained traction as a strategic response to regulatory hurdles.
• HCLTech reported that approximately 80% of its US workforce comprises local hires, significantly reducing its visa dependence.
• TCS opened its eighth AI-driven operations centre in Mexico in August 2025, building a substantial local workforce there.
• Indian IT firms accounted for less than 2% of PERM applications filed between October 2024 and September 2025, indicating low reliance.

Key Concepts Involved:

• H-1B Visa: A non-immigrant visa allowing US employers to temporarily employ foreign workers in specialty occupations.
• Permanent Labour Certification Programme (PERM): A process by the US Department of Labor for employers seeking to hire foreign workers permanently.
• Nearshoring: Relocating business processes or services to a nearby country, often sharing a border or time zone.
• Offshoring: Relocating a business process from one country to another, typically to lower costs for efficiency.