Coforge, Wipro Lead IT Losses Amid Trump’s H-1B Visa Reform Proposal

IT Stocks: IT stocks Wipro, Tata Consultancy Services (TCS), Infosys, Tech Mahindra, LTIMindtree, HCL Technologies, Persistent Systems, Coforge, etc. traded in the negative zone on Wednesday, September 24.

Coforge remained the biggest loser to fall 2.15 per cent to trade at Rs 1632 apiece at noon. Wipro traded 1.70 per cent lower to Rs 245 apiece, while Tech Mahindra was down by 1.21 per cent to Rs 1,454 apiece.

The Donald Trump administration in the US has proposed replacing the current lottery system for H-1B visa allocation with a wage-based selection process. Under the draft rule issued by the Department of

Homeland Security, applications offering higher salaries would be given preference when the number of requests exceeds the annual cap of 85,000 visas.

The proposal is designed to prioritize highly skilled and better-paid foreign workers while still leaving room for employers to hire talent across wage levels. According to Reuters, the move is intended to safeguard American workers from unfair wage competition.

Earlier, a wave of panic swept across the IT industry after the Trump administration approved a proclamation hiking the annual fee for H-1B visa holders to a staggering $100,000 with a one-day deadline. The families of H-1B visa holders scrambled to return to US before the deadline end in order to avoid the skyrocket fee. However, a day later, the Trump administration issued a major clarification, saying this fee will be a “one-time” payment for only new applicants, and not an annual fee. It will only be imposed on new applicants and not impact renewals as well as existing visa holders.

This clarification has brought a sigh of relief for H-1B visa and H-4 visa holders for the time being.

The proposal to scrap the lottery system and introduce wage-based selection process could hurt fresher hiring particularly, with startups and Indian IT firms seen as most impacted, says ICICI Securities. The brokerage believes Indian IT companies will partially mitigate it through offshore hiring, local hiring and near shoring.