The US government has dropped a bombshell. From now on, any new H-1B visa application will cost a one-time fee of $100,000. For years, this visa has been the ticket for Indian tech talent to work onsite in the US. Overnight, that ticket just became super expensive.
hurt, who gets hurt, and who has to rethink their plans?
Why is this important?
India’s IT industry is huge, around $283 billion, with more than half of its business tied to US clients.
In 2024, 7 out of 10 H-1B approvals went to Indians. That shows how dependent Indian firms are on this program.
Analysts estimate the extra fee could cost the Indian IT sector anywhere between $150 million and $550 million a year.
That’s not pocket change.
Who feels the heat?
Indian IT giants like Infosys, TCS, and Wipro already saw their stock prices dip after the news. Investors are worried about rising costs.
Smaller Indian IT firms will feel the pinch harder. Many rely on sending dozens of employees to the US. Paying $100,000 per head is simply not sustainable.
US companies are not smiling either. They depend on Indian IT services and skilled workers to run projects. If costs go up or talent becomes scarce, projects may slow down.
How many companies respond?
Do more work from India – Push projects offshore and rely on remote teams.
Hire more locals in the US – Bring in Americans or green card holders for onsite roles.
Limit H-1Bs – Save the costly visa slots for only senior or specialist roles.
Talk to clients – Try to pass on some of the cost or redesign delivery models.
Use other visas – Explore L-1 or other categories where possible.
Invest in automation – Rely less on people physically being there and more on smart tools.
Lobby for change – Industry bodies like Nasscom are already raising concerns in Washington and Delhi.
The road ahead
This fee is not just about money. It signals that the US wants to rely less on foreign workers. For Indian IT, it is a headache but also a chance. The firms that adapt quickly, by improving remote delivery, building local teams, and using technology better, may come out stronger.
For US clients, the new rule could mean higher project costs in the short term. But it may also force smarter collaboration models with Indian partners.
The bottom line: H-1B has gone from a golden ticket to a very expensive one. Both Indian and US companies will now have to get creative to keep business moving.
Disclaimer
This blog is purely for educational purposes and should not be considered investment advice. Please do your own research or consult a registered financial advisor before making any investment decisions.