Industry body Nasscom will take a delegation of senior executives to Washington DC later this month to reach out to the new US administration as well as senators on concerns around clampdown on visas and flow of skilled manpower between the two nations. Also Read - 11th India Game Developers Conference scheduled for November 22Also Read - Reliance Jio, Paytm advocate increased regulation of messages on OTT platforms
“Nasscom plans to visit Washington between February 22 and 24. We are looking at meeting representatives in the new Trump administration as well as engage with Senators and Congressmen,” Nasscom President, R Chandrashekhar told . The delegation will highlight and share information with the new US administration on direct jobs being created by Indian IT companies in the US, and contribution of Indian IT firms in making the US economy competitive.
He added that the process of finalizing meetings and details of members of the delegation are being worked on. The proposed overhaul of popular H-1B visa regime by American President Donald Trump has raised concerns among the Indian IT firms, as any changes in the visa regime may result in higher operational costs and shortage of skilled workers for the $110 billion Indian outsourcing industry.
Indian IT sector, which contributes 9.3 percent of the country’s GDP, is one of the largest private sector employer at 3.7 million people. The US contributes nearly 62 percent of the exports, while EU is the second largest market for the Indian IT Services exporters contributing approximately 28 percent.
Recently, a US legislation (Lofgren Bill) has been introduced that proposes doubling of the minimum wages of H-1B visa holders to $130,000. The current H-1B minimum wage of $60,000 was fixed in 1989 and has since remained unchanged. ALSO READ: Nasscom to meet US lawmakers and policymakers in February and March
“With such large exposure to the US, proposed hike in minimum wages…will be negative for the Indian IT services. Indian IT services companies will need to adopt their business models owing to high dependence on export of low-cost skilled manpower from countries such as India to developed economies,” rating agency ICRA said.
Such protectionist stance by the US could also spell more trouble for IT firms that are already facing strong headwinds from currency fluctuation and cautious client spending. The Ministry of External Affairs has said India’s interest and concerns on the issue have been conveyed both to the US administration and the US Congress at senior levels.
Analysts are of the opinion that Indian companies could easily witness around 60-70 percent rise in salaries of the H-1B visa dependent workforce, which could lead to a 5-10 percent hit on the margins, depending on the total base of employees currently on H1-B visas.
Global tech titans like Google CEO Sundar Pichai, Microsoft chief Satya Nadella, Apple‘s Tim Cook and others have already voiced their concerns on the issue. ALSO READ: Apple to start manufacturing iPhones in India by June
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