India is poised to turn a headline shock into a long-term prize.
Washington’s abrupt move to slap a US$100,000 charge on new H-1B visa applications has rattled markets, hitting India’s flagship technology shares and trimming both the Nifty 50 and Sensex.
To many investors, it looked like a gut punch to a sector that depends heavily on sending engineers and developers to the US. But history shows that when America raises barriers to skilled immigration, global companies don’t cancel their projects – they shift them offshore.
This plays directly to India’s strengths. The H-1B visa has been a quiet engine of US dominance in technology and innovation. Around 70% of approvals each year go to specialists in computing, data science and other high-end engineering roles.
At any moment, roughly 600,000 to 700,000 of these professionals are working inside the US. Economists estimate their contribution to American output at well over $100 billion annually.
Immigrants who began their US careers on H-1Bs have gone on to found or lead a majority of the country’s billion-dollar start-ups. More than 60% of new PhDs in computer science and engineering in the US are foreign-born, and most stay in America only because the H-1B exists.
Now, Washington wants companies to pay a six-figure premium for each new hire in that pool. It’s hard to imagine a more direct incentive to keep the work where the talent originates.
A decade ago, when visa fees rose and quotas tightened, US multinationals responded by expanding their Indian delivery centers. The pattern repeated during pandemic-era restrictions. This latest hike is larger and will accelerate the same trend.
India is ready. Tech and business-process exports surpassed $200 billion last year, overtaking merchandise trade as the country’s biggest foreign-exchange earner. The rupee has held steady while the dollar has strengthened, making Indian contracts even more attractive to US clients.
Wage inflation that worried some investors during the post-pandemic hiring boom has eased, and every spring, a new wave of engineers, including more than a million graduates, many trained in AI and cloud computing, enters the Indian workforce.
The government is reinforcing that base with tax incentives for software parks, streamlined data-protection rules that reassure overseas clients and heavy investment in data-center capacity and 5G networks.
These steps lower operating costs and remove friction for global firms shifting more work to Indian teams.
For America, the move is counterproductive. The H-1B program has been central to breakthroughs in semiconductors, biotechnology and artificial intelligence, among others.
By importing the world’s best minds, the US has effectively outsourced education costs while keeping the innovation at home. Raising the price of entry undermines that advantage and invites competitors to capture it.
India, with its scale, democratic stability and proven track record of protecting intellectual property, is the obvious destination.
Investors who sold Indian IT shares on the initial headlines may want to rethink their moves. Analysts already expect offshore revenue, where margins are higher, to grow as US clients adjust their staffing models.
Market leaders across the subcontinent have cash reserves to expand quickly and to invest in automation and cloud infrastructure, which will amplify profitability when demand rises. India’s broader macro picture is equally compelling. Services exports generate the foreign exchange India needs to fund infrastructure and energy investment.
As more high-value work stays onshore, ancillary industries from renewable power to cybersecurity will benefit. The result is a deeper, more resilient digital economy that supports sustained growth well beyond the technology sector.
The irony is hard to miss. America’s own success story—its dominance in tech and innovation—owes a great deal to the very visa it is now pricing out of reach. By making it prohibitively expensive to hire the global talent that built Silicon Valley, Washington will send more of the work, and the wealth it creates, overseas.
India is prepared to receive it. The market jitters will fade and the structural gains are likely to begin in earnest.
