Business
H-1B: What Trump’s $100,000 visa means for India and US industries
Soutik Biswas and Nikhil InamdarBBC News
Getty ImagesPanic, confusion and then a hasty White House climbdown – it was a weekend of whiplash for hundreds of thousands of Indians on H-1B visas.
On Friday, US President Donald Trump stunned the tech world by announcing an up to 50-fold hike in the cost of skilled worker permits – to $100,000. Chaos followed: Silicon Valley firms urged staff not to travel outside the country, overseas workers scrambled for flights, and immigration lawyers worked overtime to decode the order.
By Saturday, the White House sought to calm the storm, clarifying that the fee applied only to new applicants and was a one-off. Yet, the long-standing H-1B programme – criticised for undercutting American workers but praised for attracting global talent – still faces an uncertain future.
Even with the tweak, the policy effectively shutters the H-1B pipeline that, for three decades, powered the American dream for millions of Indians and, more importantly, supplied the lifeblood of talent to US industries.
That pipeline reshaped both countries. For India, the H-1B became a vehicle of aspiration: small-town coders turned dollar earners, families vaulted into the middle class, and entire industries – from airlines to real estate – catered to a new class of globe-trotting Indians.
For the US, it meant an infusion of talent that filled labs, classrooms, hospitals and start-ups. Today, Indian-origin executives run Google, Microsoft and IBM, and Indian doctors make up nearly 6% of the US physician workforce.
Indians dominate the H-1B programme, making up more than 70% of the recipients in recent years. (China was the second-largest source, making up about 12% of beneficiaries.)
In tech, their presence is even starker: a Freedom of Information Act request in 2015 showed over 80% of “computer” jobs went to Indian nationals – a share industry insiders say hasn’t shifted much.
The medical sector underlines the stakes. In 2023, more than 8,200 H-1Bs were approved to work in general medicine and surgical hospitals.
India is the largest single source of international medical graduates (who are typically in US on H-1B visas) and make up about 22% of all international doctors. With international doctors forming up to a quarter of US physicians, Indian H-1B holders likely account for around 5-6% of the total.
Experts say pay data shows why Trump’s new $100,000 fee is unworkable. In 2023, the median salary for new H-1B employees was $94,000, compared with $129,000 for those already in the system. Since the fee targets new hires, most won’t even earn enough to cover it, say experts.
“Since the latest White House directive indicates that the fee would only apply to new H-1B recipients, this is more likely to cause medium and long-term labour shortages instead of immediate disruption,” Gil Guerra, an immigration policy analyst at the Niskanen Center, told the BBC.
India may feel the shock first, but the ripple effects could run deeper in the US. Indian outsourcing giants such as TCS and Infosys have long prepared for this by building local workforces and shifting delivery offshore.
The numbers tell the story: Indians still account for 70% of H-1B recipients, but only three of the top 10 H-1B employers had ties to India in 2023, down from six in 2016, according to Pew Research.
To be sure, India’s $283bn IT sector faces a reckoning with its reliance on shuttling skilled workers to the US, which accounts for over half its revenue.
IT industry body Nasscom believes the visa fee hike could “disrupt business continuity for certain onshore projects”. Clients are likely to push for repricing or delay projects until legal uncertainties are cleared, while companies may rethink staffing models – shifting work offshore, reducing onshore roles and becoming far more selective in sponsorship decisions.
Indian firms are also likely to pass on the increased visa costs to US clients, says Aditya Narayan Mishra of CIEL HR, a leading staffing firm.
“With employers reluctant to commit to the heavy cost of sponsorship, we could see greater reliance on remote contracting, offshore delivery and gig workers.”
The broader impact on the US could be severe: hospitals facing doctor shortages, universities struggling to attract STEM students, and start-ups without the lobbying muscle of Google or Amazon are likely to be hit hardest.
“It [visa fee hike] will force US companies to radically change their hiring policies and offshore a significant amount of their work. It will also ban founders and CEOs coming to manage US-based businesses. It will deal a devastating blow to US innovation and competitiveness,” David Bier, director of immigration studies at the Cato Institute, told BBC.
San Francisco Chronicle via Getty ImagesThat anxiety is echoed by other experts. “The demand for new workers in fields like tech and medicine [in US] is projected to increase (albeit in uneven ways), and given how specialised and critical these fields are, a shortage that lasts even a few years could have a serious impact on the US economy and national well-being,” says Mr Guerra.
“It will likely also incentivise more skilled Indian workers to look at other countries for international study and have a cascading effect on the American university system as well.”
The impact, in fact, will be felt most sharply by Indian students, who make up one in four international students in the US.
Sudhanshu Kaushik, founder of the North American Association of Indian Students, which represents 25,000 members across 120 universities, says the timing – just after September enrolments – has left many new arrivals stunned.
“It felt like a direct attack, because the fees are already paid, so there’s a big sunk cost of anywhere between $50,000 and $100,000 per student – and the most lucrative route to entering the American workforce has now been obliterated,” Mr Kaushik told the BBC.
He predicts the ruling will hit US university intake next year, as most Indian students opt for countries where they can “put down permanent roots”.
For now, the full impact of the tax hike remains uncertain.
Immigration lawyers expect Trump’s move to face legal challenges soon. Mr Guerra warns that the fallout could be uneven: “I expect the new H-1B policy will bring a number of negative consequences for the US, though it will take some time to see what those may be.”
“For example, given that the executive order allows for certain companies to be excepted, it could be possible that some heavy H-1B users such as Amazon, Apple, Google, and Meta will find a way to be exempted from the H-1B fee policy. If they all get exemptions, however, this would largely defeat the purpose of the fee.”
As the dust settles, the H-1B shake-up looks less like a tax on foreign workers and more like a stress test for US companies – and the economy. H-1B visa holders and their families contribute roughly $86bn annually to the US economy, including $24bn in federal payroll taxes and $11bn in state and local taxes.
How companies respond will determine whether the US continues to lead in innovation and talent – or cedes ground to more welcoming economies.
Indians sharply cut back on overseas travel spending in March, with remittances for foreign trips dropping by more than $212 million from the previous month, according to Reserve Bank of India data. The fall in outbound travel expenditure came amid rising oil prices linked to the Middle East conflict and persistent pressure on rupee, even as travel remained the single largest component of outward remittances under the Liberalised Remittance Scheme (LRS).In March, travel-related remittances fell to $1.09 billion from $1.3 billion in February and $1.65 billion in January. The decline came at a time when the West Asia conflict pushed oil prices higher and weakened rupee to record lows. Amid the situation, Prime Minister Narendra Modi urged citizens to cut down on foreign travel and adopt measures such as carpooling. Lower overseas travel spending could reduce foreign exchange outflows and help ease pressure on rupee.According to the RBI’s data on outward remittances by resident individuals, travel continued to account for the largest share of money sent abroad under the LRS in March. Total remittances during the month stood at $2.59 billion.The RBI tracks overseas spending across categories including travel, studies abroad, maintenance of close relatives, overseas investments, and property purchases. Under the LRS framework, resident individuals, including minors, can remit up to $250,000 in a financial year for permitted current or capital account transactions.Within the travel segment, the biggest component remained the ‘other travel’ category, which covers holiday spending and international credit card settlements. Indians spent $623.05 million under this category in March, accounting for nearly 57 per cent of total travel-related remittances during the month.Expenditure linked to education travel, including hostel and fee payments, stood at $450.16 million. Business travel, pilgrimage, and overseas medical treatment together accounted for $21.39 million.The data also showed a rise in remittances meant for the maintenance of close relatives abroad. Such transfers increased to $389.78 million in March from $266.18 million in February.At the same time, spending under the ‘studies abroad’ category declined. This category includes payments made for educational services accessed remotely without travelling overseas, such as correspondence courses. Remittances under this head stood at $151.71 million in March, compared to $175.68 million in February and $267.42 million in January.For the financial year 2024-25, Indians remitted a total of $29.56 billion under the LRS. Travel made up the largest portion of this amount at $16.96 billion.The RBI figures further showed that investments by Indians in overseas equity and debt instruments rose significantly to $440.22 million in March from $265.99 million in February.Meanwhile, outward remittances for the purchase of immovable property overseas declined to $38.68 million in March, down from $51.36 million a month earlier.
Gold and silver are expected to take cues from developments in the ongoing US-Iran talks this week, with analysts forecasting a largely steady trend for gold prices while silver may continue to outperform amid geopolitical tensions and elevated crude oil prices.Investors are also likely to track a series of economic indicators from the United States, including GDP data, housing numbers, consumer confidence figures and the Personal Consumption Expenditure (PCE) inflation print, as markets look for signals on the Federal Reserve’s next policy move.“Gold price momentum next week looks sideways, while silver still looks positive as focus will again be on the peace negotiations between the US and Iran to end the war,” said Pranav Mer, Vice President, EBG – Commodity & Currency Research, JM Financial Services Ltd.Trading activity in domestic commodity futures markets will be curtailed on Thursday morning due to Bakri Id.On the MCX, gold futures ended the previous week at Rs 1.58 lakh per 10 grams after posting marginal gains, while silver futures settled lower at Rs 2.71 lakh per kilogram.“Gold traded in a range-bound manner last week, posting marginal gains of around 0.40% on the MCX to close near Rs 1,58,670 per 10 grams,” said Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities.He noted that crude oil prices witnessed heavy profit booking during the week and corrected nearly 7% from recent highs, easing concerns around inflationary pressure globally.“At the same time, the rupee recovered from weaker levels of 97 against the US dollar to strengthen near 95.70, which limited upside momentum in domestic gold prices despite stable international bullion trends,” Trivedi added.In international trade, Comex gold futures closed the week 1% lower at $4,523.2 per ounce. Silver futures also weakened, slipping nearly 2% to $76.20 per ounce.“Gold prices moved in a consolidative range over the past few sessions, but ended the week with a marginal loss. Prices were steady amid a lack of fresh direction in the market — be it on the economy front or the US-Iran war front,” Mer said.According to analysts, uncertainty surrounding the geopolitical situation has continued to keep markets on edge, particularly as statements from both Washington and Tehran have frequently shifted.On Sunday, US President Donald Trump said that an agreement between the US and Iran aimed at reducing tensions in the Gulf region and reopening the Strait of Hormuz was close to being finalised.Posting on Truth Social, Trump said the deal had been “largely negotiated” and that only final formalities remained.However, Iranian media disputed Trump’s remarks regarding the full reopening of the Strait of Hormuz, stating that Tehran would continue to maintain control over the key waterway.Analysts said the contrasting positions from both sides are likely to keep bullion prices sensitive to any fresh headlines emerging from the region.Meanwhile, market participants are also expected to monitor comments from Federal Reserve officials after Kevin Warsh formally succeeded Jerome Powell as head of the US central bank on Friday during a period of geopolitical tensions, market volatility and persistent inflation pressures.
Business
Stock market this week: Middle East tensions, oil prices, FII flows & more — what will guide Dalal Street
Dalal Street is heading into the new trading week with global uncertainty firmly in focus, as investors keep a close watch on the evolving situation in the Middle East, fluctuations in crude oil prices and the behaviour of foreign investors. Analysts said that sentiment is likely to remain fragile and heavily influenced by developments in negotiations between the United States and Iran, while movements in the rupee, global equities and the US dollar are also expected to shape market direction in the days ahead.Trading activity during the week is also expected to be shaped by the rupee’s movement against the US dollar, while investors continue to assess the impact of global uncertainty on risk appetite. Markets will remain closed on Thursday for Bakri Id.A key trigger for sentiment emerged over the weekend after US Secretary of State Marco Rubio said negotiations between Washington and Tehran had shown some progress, raising expectations that the ongoing conflict in West Asia could move closer to resolution.Ajit Mishra, SVP, Research at Religare Broking Ltd, said investors would closely track developments tied to crude oil, global currencies and bond markets. “This week is expected to remain highly sensitive to global macroeconomic developments and currency movements. Investors will also monitor crude oil prices, developments in US-Iran negotiations, and the trajectory of the US dollar and bond yields, all of which are expected to influence foreign flows and overall risk appetite,” he said.Apart from geopolitical developments, the Reserve Bank’s decision to transfer a record Rs 2.87 lakh crore dividend to the government for the year ended March 2026 is also expected to remain in focus. The announcement comes at a time when rising import costs and supply chain pressures linked to the West Asia conflict continue to weigh on the economy.According to Mishra, market participants are expected to evaluate how the RBI payout could affect liquidity conditions, fiscal flexibility and government spending in the months ahead.Ponmudi R, CEO of Enrich Money, said market behaviour in the coming sessions is expected to remain sensitive to fresh headlines surrounding diplomatic negotiations and oil prices. “Markets are expected to remain volatile and heavily headline-driven in the coming week, with investor attention firmly focused on developments surrounding the US–Iran situation, broader diplomatic negotiations and movements in crude oil prices,” he said.“While hopes of a diplomatic breakthrough and easing geopolitical tensions have improved sentiment modestly, investors continue to remain cautious as uncertainty surrounding the final outcome of the negotiations remains elevated,” Ponmudi added.He further said investors are expected to watch institutional flows, global equity trends, macroeconomic indicators and the rupee for further market cues. “With global uncertainty still elevated, market participants are likely to remain selective and cautious despite the recent improvement in sentiment,” he said.Vinod Nair, Head of Research at Geojit Investments Limited, said markets would require stronger support factors to build a more constructive setup. According to him, a meaningful decline in crude oil prices, steady foreign institutional investor flows and stable Q1FY27 earnings expectations without major downgrades would be important for sustained momentum.In the previous week, the BSE benchmark index rose 177.36 points, or 0.23%, while the NSE Nifty advanced 75.8 points, or 0.32%.
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