Daijiworld Media Network - New Delhi

New Delhi, Sep 22: A new US government order requiring H-1B visa petitioners to pay a $100,000 one-time fee is unlikely to significantly impact India’s large- and mid-cap IT services firms, according to a report released by fund management firm Equirus on Monday.

The restriction, which applies only to new H-1B applicants and is set to remain in effect for 12 months starting September 21, 2025, can be effectively mitigated through strategic workforce planning — including increased local hiring, subcontracting, and offshoring, the report stated.

Equirus analysts estimated that if the fee applies only to new visa applicants, the impact on operating profit margins would be minimal:

• Large-cap IT firms: 7–14 basis points
• Mid-cap firms: 21–39 basis points

However, if the fee is extended to include new and existing H-1B holders located outside the US, the margin impact could be higher:

• Large-cap firms: 26–49 basis points
• Mid-cap firms: 60–109 basis points

Despite the potential costs, the report notes that Indian IT service providers have significantly reduced their dependence on H-1B visa holders over the last 6–8 years. Currently, H-1B holders account for about:

• 25–35% of the workforce at large-cap firms
• 30–60% at mid-cap and other IT service providers

Interestingly, the $100,000 fee is often higher than the annual salary paid to many H-1B workers by Indian IT vendors, making the visa route less economically viable under the new rule.

“We believe common sense will prevail — companies are likely to replace affected applicants by hiring local talent, green card holders, or subcontractors, and will also increase offshoring,” the Equirus report noted.

That said, the firm acknowledged a slight risk to revenue growth in the second half of FY26, as companies will need time to adjust their hiring strategies and obtain necessary client approvals.

The move comes as the US continues to tighten immigration norms affecting skilled foreign workers. Around 71% of all H-1B visa holders are Indian nationals, with major Indian IT players such as TCS, Infosys, Wipro, and Cognizant among the largest beneficiaries of the program.

While the one-time fee may create short-term friction, the long-term structural shift toward increased local hiring and remote delivery appears well underway — suggesting Indian IT companies are prepared to adapt without major disruption.