US immigration crackdown: How Indian IT giants have long prepared for this moment
Source Entity
Akash Mandal
The US has suspended PERM green card processing for several major IT firms, including TCS and Infosys. However, industry experts suggest the impact will be limited as these companies have already pivoted to local hiring and offshore delivery models.
The Evolving Landscape of US-India IT Relations
A Strategic Pivot in Business Models
For decades, the Indian IT services sector relied on a model that involved sending experienced engineers to the United States on H-1B visas to manage client relationships and execute complex projects. However, facing years of tightening US immigration regulations, these firms—including giants like Tata Consultancy Services (TCS), Infosys, Wipro, and HCL Technologies—have proactively diversified their operational strategies. By increasing local hiring in the US and Europe and establishing robust delivery centers in alternative global hubs, these companies have significantly reduced their structural dependence on US work visas.
Analyzing the PERM Suspension
The recent decision by the US administration to suspend the permanent labor certification program (PERM) for eight major technology and outsourcing firms marks a significant policy shift. While the move directly impacts the pathway for H-1B visa holders to transition to permanent residency, data suggests the immediate operational impact on these Indian majors will be limited. Records indicate that these firms accounted for fewer than 1,400 of the 117,849 PERM applications filed in FY25, representing less than 2% of the total volume. This suggests that the 'green card' route for these specific companies had already slowed to a trickle long before the official suspension.
The 'India-First' Upside
Industry experts, including Zerodha’s Dinesh Pai, have pointed to a potential silver lining for the Indian ecosystem. As the US creates barriers to importing human capital, the natural economic response for global corporations is to export the work to where the talent resides. If US companies find it increasingly difficult to bring talent into the American market, they are expected to shift more high-value projects to India. This trend could further bolster the growth of Global Capability Centers (GCCs) and domestic AI startups, effectively turning a regulatory hurdle into a catalyst for Indian digital infrastructure development.
Historical Context and Resilience
This regulatory action, announced by US officials including Vice President JD Vance and Labor Secretary Keith Sonderling, follows a long history of US immigration scrutiny. Indian IT firms have learned to navigate these cycles by maturing from simple 'body shopping' operations into comprehensive managed services providers. Because the current suspension does not affect existing visas or green cards, the immediate workforce stability of these firms remains intact. The industry is viewing this not as a crisis, but as the acceleration of an existing trend toward decentralized global delivery.
Future Trends and Outlook
Moving forward, the shift toward offshore execution is likely to deepen. As Indian IT giants continue to invest in local talent in the West while simultaneously scaling their domestic delivery capabilities, the reliance on the green card pathway will likely diminish further. While the current suspension creates anxiety for individual professionals in the US, the structural resilience of the major IT firms suggests they are well-positioned to maintain their client commitments. The long-term trajectory points toward a more distributed global workforce, where proximity to the client is increasingly achieved through digital connectivity rather than physical relocation.