The new hiked fee for the H-1B visa will not impact current applications, but lead to offshoring by companies in the coming months, opined former Infosys CFO, Mohandas Pai, who dismissed US President Donald Trump’s claims that the visa category is “exploited” to replace American workers.
The industry veteran spoke on Saturday about Trump’s latest move in which the President signed a proclamation that imposes a hefty fee of USD 100,000 annually on H-1B visa applicants to safeguard highly-skilled work roles for American citizens.
"It has got limited application, because it doesn't apply to all the H-1B visas which are already approved. So, there could only be impact for anybody applying in the future, which is why new applications will come down. Nobody's going to pay USD 100,000, no doubt about that," Pai said, adding that it may accelerate offshoring in the coming months.
According to the US Citizenship and Immigration Services (USCIS) website, the H-1B programme allows employers in the United States to temporarily employ foreign workers in occupations that require the theoretical and practical application of a body of highly specialised knowledge and a bachelor's degree or higher in the specific specialty, or its equivalent.
So, while the H-1B non-immigrant visa programme was created to bring temporary workers into the US to perform additive, high-skilled functions, Trump claims it has been deliberately exploited to replace, rather than supplement, American workers with lower-paid, lower-skilled labour, a “rhetoric” that Pai says is “misplaced”.
Also Read: Amazon, TCS highest beneficiaries of approved H-1B visas
Arguing that H-1B visas are “not cheap”, the former CFO said the average salary paid by the top 20 H-1B employers exceeds USD 100,000, so it does not amount to “cheap labour”.
"People pay more than USD 100,000 as salaries, they're not cheap. If they pay their staff USD 100,000, they charge their clients USD 150,000-160,000, so all this idea of sending cheap, low-skilled people, that doesn't hold water," he observed.
Pai said he has long been maintaining that Indian IT firms’ dependence on H-1B visas was significantly decreasing over a period of time, since data indicates that many leading American tech companies are in fact among the top applicants for these visas.
An IT industry expert shared that fresh approvals for Indian tech companies ranges from 8,000-12,000 every year. Global tech giants like Amazon, Google, and Microsoft account for significant H-1B numbers to get "the best talent" to the US.
Pai said going forward, companies are likely to increase offshoring.
"Now what will happen is everybody will work to increase offshoring...because it doesn't make sense, first, you don't get talent, second the costs are too high they'll increase offshore. That will happen over the next six months to one year. So, we have to wait and see what happens but right now, but for 3-6 months it will not have any big impact," he stated.
A look at the USCIS website also shows that for the fiscal year 2025 (data as on June 30, 2025), Amazon topped the list of H-1B visa approvals at 10,044.
In that list of top 10 beneficiaries, TCS (5,505) is at the second spot followed by Microsoft Corp (5,189), Meta (5,123), Apple (4,202), Google (4,181), Cognizant (2,493), JP Morgan Chase (2,440), Walmart (2,390) and Deloitte Consulting (2,353). The top 20 list includes Infosys (2,004), LTIMindtree (1,807), and HCL America (1,728).
The US Congress has set a mandated cap of 65,000 H-1B visas with 20,000 additional H-1B visas for professionals who have obtained a master's degree or higher from an accredited US institution.
Industry experts are saying Trump’s move will slow down innovation in the US and ramp it up in India.
The high visa fee will choke US innovation and turbocharge India's thought leadership by pushing the next wave of labs, patents and startups to cities like Bengaluru, and Hyderabad, opined former NITI Aayog CEO, Amitabh Kant.
"Donald Trump's 100,000 H-1B fee will choke U.S. innovation, and turbocharge India's. By slamming the door on global talent, America pushes the next wave of labs, patents, innovation and startups to Bangalore and Hyderabad, Pune and Gurgaon. India's finest doctors, engineers, scientists, innovators have an opportunity to contribute to India's growth & progress towards #ViksitBharat. America's loss will be India's gain," he said in a post on X on Saturday.
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