The IT industry in India is worried as the scramble for H1B visas has begun.

With the United States Citizenship and Immigration Services capping the number of H1B visas at 65,000, the companies are keeping their fingers crossed as the US immigration authorities begins the screening process.

If they don’t get enough H1Bs, Indian firms operating there would have to hire locally, forcing them to pay 50-100 per cent more.

H1B visas allow the US employers to temporarily recruit workers from abroad.

The Indian IT companies would require such visas in large numbers to send people from India.

But this time around it is unlikely that they would get enough numbers. The first 20,000 applications with US master’s degree or higher are exempt from the fiscal year cap.

Reports suggest that the US authority had received about 50,000 applications on the first day itself. It might go for a lottery to pick eligible candidates for the visa.

Mahindra Satyam and Tech Mahindra are seeking some 2,000 H1B visas to support its expansion and supporting the clients in the US. “We are looking at about 1,200 such visas for Mahindra Satyam,” T. Hari, Chief People’s Officer and Chief Marketing Officer of Mahindra Satyam, told Business Line.

Zensar is looking at having 300 H1Bs visas against 100 last year, Ganesh Natarajan, Vice-Chairman and Chief Executive Officer of Zensar, said.

Citing the silent period, Infosys, TCS and Wipro have not indicated the number of visas they would require.

Sanjay Dhawan, Technology Leader of PwC India, said the recent Senate Judiciary Committee’s plans might force some of the companies that do not have a large local workforce to hire more locally, in order to ensure that the current percentage of workforce already on H1B is below 50 per cent.

“This would have an impact on the margins of these companies,” he added.

“The unemployment rate in the US has risen considerably, especially after the economic turmoil, and this in the IT sector is also high. This has also led to an increase in sub-contracting and local hiring,” Harit Shah, Senior Research Analyst at Nirmal Bang Institutional Equities, said.

The flip side

“The flip side for the Indian companies is that local hiring in the US would impact their margins as the salaries are highest by about 50-100 per cent,” Harit Shah added.

(with inputs from Rajesh Kurup in Mumbai and Venkatesh Ganesh in Bangalore)

(This article was published on April 5, 2013)
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