The Hindu Business Line : H1-B visa cap may be reached early — `Restriction will bring more offshore work to India'

H-1B visa availability to the US during fiscal 2005, which starts from October 1, is going to be limited, going by the latest data released by the United States Citizenship and Immigration Services.

As of the first week of August, 45,900 H-1B filings had been received subject to the fiscal cap. Of these, 21,000 have been approved. The full quota for the fiscal is 65,000.

This means that the cap will be reached fairly soon, probably much before the fiscal ends, said a source in the IT industry. "Every year, around 20,000 Indian professionals go to the US under various visas, and a significant portion of them from the software industry," he added.

The limit on H-1B visas, meant for temporary professional workers employed in a speciality occupation, is likely to affect Indian software firms, which have a large number of clients in the US.

However, it would bring more offshore work to India from the US. Further, software companies would judiciously use a combination of H (temporary employment in the US) and L (intra-company transferees type visas), said an official of a software firm.

If the cap does get exhausted at an early date, as is envisaged, it would definitely impact all IT firms that are dependent on H1.

This restriction in visa availability would curtail the flexibility to reinforce onsite teams at various stages in the software development lifecycle (system requirement study, testing and implementation phases) if adequate and proactive planning is not in place, according to an official at Satyam Computers.

At Satyam, this risk is addressed through a forward planning process at a project/customer level and applying for visas to minimise the risk.

Associates with valid H1 visas and who are yet to travel are cross-trained on multiple skills as an additional step.

The company also has in place processes - with effective and time-tested service level agreement - that enable acquisition of talent locally in the US itself. Wherever possible and justified, alternate visas (such as L1) are also used, the official said.

The limit on visas would bring more offshore work to India. This means more benefits are passed on to customers. "It would also lead to clients visiting Wipro more often," said Mr Laxman Badiga, Chief Executive, Talent Transformation, Staffing and External Relations, Wipro Technologies.

The company has quite a number of visas - each H1-B visa is valid for six years, he said.

Tough for small players: The limit would, however, affect small firms applying for H-1B visa for the first time, and the competition would be intense, said an industry source.

The H-1B category allows US employers to augment their existing labour force with skilled temporary workers.

H-1B workers are admitted to the US for an initial period of three years, which may be extended by three years.

Ms Anu Sharma, Vice-President (Human Resources), iGATE Global Solutions, said that the restriction on the H1-B visas would drive more clients to get work done offshore. This, in turn, would lower the costs for them.

With many companies operating on the global delivery model, this means more business. iGATE recruits local talent in all geographies, which reduces visa-related risks for its business.

The company's strategy covers proactive hiring, making existing employees H1-ready and ensuring some of the company's employees qualify for the L1 visa programme, she said.

According to an official at Polaris Software, the current restrictions would have an impact on IT companies. However, Polaris has current restrictions well within the buffer for its requirements towards growth of business from the US market.