Shares of technology were under pressure on Friday due to concerns related to H-1B visa. US President Donald Trump is considering suspending a number of employment visas including the H-1B, most sought-after among Indian IT professionals, in view of the massive unemployment in America due to the coronavirus pandemic, according to a media report.
Today, shares of TCS, Infosys and Wipro fell 1.41%, 1.63% and 2.26%, respectively, on BSE, while the benchmark index, Sensex gained 0.72% to 33,780.89.
The proposed suspension could extend into the government’s new fiscal year beginning October 1, when many new visas are issued, The Wall Street Journal reported on Thursday, quoting unnamed administration officials.
The H1B visa is a non-immigrant visa that allows US companies to employ foreign workers in speciality occupations that require theoretical or technical expertise. Technology companies depend on it to hire tens of thousands of employees each year from countries like India and China.
Such a decision by the Trump administration is likely to have an adverse impact on thousands of Indian IT professionals. Already a large number of Indians on the H-1B visas have lost their jobs and are headed back home during the coronavirus pandemic. In addition to the H-1B visas, the suspension could apply to the H-2B visa for short-term seasonal workers, the J-1 visa for short-term workers including camp counselors and au pairs and the L-1 visa for internal company transfers, the financial daily reported.
The White House, however, said that no final decision has been made and the administration is considering various proposals.
In the March quarter, Tata Consultancy Services (TCS) Ltd and Infosys Ltd reported marginally lower sub-contracting costs at around 7.8 and 7.4%, respectively, of the reported revenue and they have identified sub-contracting costs among immediate margin growth levers. Another IT firm Wipro Ltd said gaining market share during these times will be a priority over discretionary spends.
From the beginning of the year, shares of IT majors such as TCS, Infosys and Wipro have fallen 5.67%, 5.42% and 15.43%, respectively.
(PTI contributed to the story)