US visa policy changes threaten Indian IT firms' profitability

Moody's has reported that changes in the U.S. H-1B visa policy could put major Indian IT firms at risk. Companies like Infosys, TCS, and Hexaware Technologies heavily rely on these visas. Rising operational costs could hurt their profitability. The H-1B visa program allows U.S. companies to temporarily employ foreign professionals in specialized roles. In 2023, about 75% of H-1B visas granted went to Indians, solidifying India's role as a key source of IT talent. Major Indian IT firms depend on these workers for long-term projects in the U.S., making them vulnerable to any shifts in immigration regulations. Moody's analysis suggests that while TCS and Infosys are better positioned to cope with rising costs due to their high profit margins, changes in U.S. immigration policy could still have a significant impact. Stricter rules may decrease the available workforce and pose challenges for companies that rely on foreign workers. In a move to mitigate disruptions, TCS, Infosys, and Hexaware are gradually increasing their hiring of local staff in the U.S. The latest data shows that Indian firms secured 20% of all H-1B visas issued, with Infosys receiving the most at 8,140 visas and TCS following with 5,274.