CHENNAI: The India's National Association of Software and Service Companies (Nasscom) has raised strong concerns over the US administration’s decision to impose a steep $100,000 annual fee on H-1B visa petitions, effective September 21, 2025. The industry body said the sudden change, announced with barely a day’s notice, creates uncertainty and threatens business continuity for Indian technology firms with operations in the United States.
According to Nasscom, the abrupt implementation timeline leaves companies, professionals, and students little scope to prepare. “Policy changes of this magnitude require a reasonable transition period,” the association said, noting that several firms may have to urgently rework project plans and onshore staffing.
The industry body also warned that the move could have ripple effects on US. innovation and the technology ecosystem. H-1B visa holders have long played a critical role in areas such as artificial intelligence, cloud services, and cybersecurity. By raising costs drastically, the fee hike may discourage firms from hiring skilled foreign workers, potentially slowing growth in frontier technologies.
At the same time, Nasscom underlined that Indian IT companies have already reduced dependence on H-1B visas by increasing local hiring in the US and complying with prevailing wage rules. While this shift cushions the immediate blow, the new visa regime could still increase costs, force more work offshore, and disadvantage startups and smaller firms that cannot absorb the additional burden.
The association has urged Washington to provide clarity on discretionary waivers and exemptions and called for more structured engagement to minimize disruption. The Indian government, through its embassy and trade channels, is also in talks with U.S. authorities to assess the fallout.
According to an industry advisor associated with a large foreign consultancy firm, the new fee poses significant risks for Indian IT services exporters, who may now recalibrate their US strategy.
"Larger companies may pass on higher costs to clients or expand local hiring, while smaller firms could struggle to remain competitive. Offshoring and remote delivery from India may accelerate, but this may not fully address client needs for onsite presence," he said seeking not to be identified due to his employer's media policy.
For the US, the policy could have mixed consequences. While it is designed to protect domestic workers, it may lead to talent shortages in specialised roles, hurt smaller businesses, and reduce the country’s attractiveness as a hub for global innovation. In the long run, this may open opportunities for rival destinations and strengthen India’s position as a technology delivery base, says he.
Nevertheless, Nasscom’s statement reflects the industry’s broader view that abrupt and costly visa changes risk undermining both business continuity and bilateral economic ties. Much will depend on whether exemptions are offered and how companies adapt their workforce strategies in the months ahead.