New visa laws could hit India’s IT industry in the coming months. On Thursday the US Senate passed a bill that drastically increases fees for two key work visas- the H1B and the L1, with prices for both up $2000. The higher fees could surge costs for Indian companies, which use the two visas to place thousands of employees at their American offices. US lawmakers expect the proposed fee hike to raise money for security along the country’s Mexican border. But for the bill to become law it will have to be approved by America’s lower house and president Obama.
The Indian government has changed its own policy on foreign IT workers here. A clarification from the home ministry says the minimum $25,000 a year requirement is back for international workers in IT and IT-enabled services. Also reinstated is the cap on the number of foreign workers. They can only constitute 1% of an organisation’s workforce and even then their numbers can’t exceed 20. The new rules apply only to Indian firms hiring within country and not to employees at their foreign locations.
IT firm TCS has won a contract from Pricewaterhouse Coopers. TCS will now handle back office operations for PwC’s American and British arms. It bagged the contract soon after PwC laid off at least 500 of its own IT employees at its Florida office. Many of those laid off were Indian nationals. The size of the TCS deal is unknown.
London-based Standard Chartered bank reported its profits for the first half of the year. And India’s now its single-biggest contributor racing past Hong Kong. Profits from Indian operations shot up 19% to $624 million before tax. Overall, Standard Chartered Plc posted a 10% gain in operating profit to $3.12 bn.
Some may call them financial weapons of mass destruction, but credit default swaps are back on the agenda in India. On Wednesday the RBI once again proposed introducing the instruments in local markets. It’s inviting comments to its draft guidelines until the fourth of October. At present, those guidelines demand users buy a CDS only if they have an underlying exposure. That effectively prevents CDS’s from being used a trading instruments. CDS’s allow lenders to insure themselves against defaults by borrowers. They were widely blamed for worsening 2008’s financial meltdown.
Reliance Industries announced it was acquiring another American shale gas operation. It has agreed to pay $392 million for a 60% stake in a venture with Carrizo Oil & Gas. The field lies in the gas-rich Marcellus region in the eastern United States. This is RIL’s third American shale gas field purchase in five months, but the first in which it’s got a majority stake.
A new study from consulting firm KPMG says companies in the Asia-Pacific region prefer China as an outsourcing destination. According to the report forty percent would rather go to China against thirty for India. KPMG surveyed two hundred eighty six executives from companies in the Asia-Pacific region for the study.
Under pressure from several governments, BlackBerry company RIM is holding its ground. This week it announced it didn’t have codes that can decrypt data sent via BlackBerrys. Authorities in countries including India are demanding RIM share technology that will allow them to intercept and read BlackBerry messages.
The Tata group has set up a five-member panel to find someone who can fill Ratan Tata’s shoes. The most talked about candidate so far is the 53-year old Noel Tata. His half brother Ratan steps down as Tata Sons chairman in December 2012.