India: Tech shares drop in face of Trump’s visa restrictions

Normally, it takes three to six months for U.S. immigration to approve the visas, but for a fee of US$1,225, companies could speed up the approval process to just 15 days. Source: Shutterstock

SHARES in major Indian IT companies dipped yesterday following the decision by U.S. President Donald Trump’s administration to suspend fast-track processing of H-1B visas widely used by foreign tech workers.

Normally, it takes three to six months for a decision from U.S. immigration, but for a fee of US$1,225, companies could speed up the approval process to just 15 days.

A statement from the U.S. Citizenship and Immigration Services (USCIS) on Friday said the service would be suspended for up to six months from April 3.

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The U.S. shares in Infosys fell 1.2 percent and Wipro’s dropped by 0.2 percent on the back of the news, according to The Business Standard.

New-Jersey based Indian company Cognizant Technology Solutions, which has a significant Indian workforce, saw shares dip by 1.7 percent.

“The impact will call for a lot more forward planning for companies,” research firm Horses for Sources chief executive Phil Fersht told The Economic Times.

“In many cases, H-1Bs are often needed quickly so this will create significant difficulties for Indian IT firms dealing with U.S. clients. I anticipate a huge influx of visa application between now and April 1.”

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The USCIS said the suspension was aimed at tackling a backlog of H-1B visas brought about by the high volume of applications and a surge in premium processing requests in recent years.

But recruitment firm Headhunters India chairman Kris Lakshmikanth told Quartz the move was meant to send a message.

“The U.S. government is clearly telling companies to not depend on the H-1B visa going forward,” he said.