Recent modifications to the United States' H-1B visa program are expected to have a "very minimal" overall impact on major Indian IT services exporters, according to Nasscom president Rajesh Nambiar. In an interview with The Economic Times, Nambiar sought to allay initial industry fears, stating that large firms have significantly reduced their reliance on these work visas over recent years.
Local Hiring and Cost Implications
Nambiar explained that a strategic shift towards increased local hiring in the U.S. has already insulated large companies from potential disruptions. He welcomed a specific clarification that international students on Optional Practical Training (OPT) extensions will be exempt from a proposed new $100,000 visa fee.
Another proposed change, which would prioritise specialised, high-salary roles in the annual H-1B lottery, could lead to increased visa costs. However, Nambiar emphasised that companies will primarily use the H-1B route for niche roles. He noted that the one-year window before the revised rules apply to the 2026 lottery gives firms ample time to further accelerate their domestic hiring efforts in the U.S. market.
Startup Challenges and Global Market Shifts
While large companies may navigate the changes smoothly, Nambiar pointed out that startups, particularly in the artificial intelligence (AI) sector, face stiffer challenges. Stricter U.S. visa rules and intense global competition for specialised talent are pushing emerging companies towards hybrid operational models. These models combine local hiring in overseas markets with remote execution and support from teams based in India.
Looking at broader market trends, Nambiar reaffirmed that the United States will remain the largest market for the Indian IT industry. However, he identified newer regions like Germany as growing opportunities for expansion and business.
India's AI Opportunity and Evolving Talent Needs
Beyond visa policies, Nambiar highlighted profound structural changes sweeping the global technology sector, driven by AI and workforce transformation. He stated that India, with its 6-million-strong tech talent base, is uniquely positioned to become the world's largest hub for AI skills. Achieving this potential, however, requires coordinated effort from industry, academia, and the government.
The talent mix within the sector is undergoing a significant shift. Although 65–70% of engineering graduates still specialise in computer science, future demand will favour professionals who blend technical expertise with domain knowledge and AI application skills. The industry onboarded 30,000–40,000 fresh graduates in the first half of the fiscal year, but employment growth continues to lag behind revenue expansion as AI adoption boosts productivity.
Despite rapid automation advances, Nambiar stressed that human expertise remains indispensable. He compared the rollout of AI in large organisations to earlier enterprise software implementations like ERP, noting that significant integration and human oversight will be crucial. "Humans remain central," he concluded.
