What is the reaction to the H-1B visa ban that is bound to come in from the IT majors in particular?
It might look a bit disappointing, but actually our dependence on new visas is a bit modest. Every year, only 65,000 visas are given, and maybe, I am just giving a ballpark number. Maybe a TCS can get 2,000 visas or Infosys gets around 3,000. These guys go to the US in October, so now that has been blocked.
Currently looking at the Covid situation and the kind of growth expected, this year is anyway going to be a washout year. It is unlikely that any new fresh entrant would come to the US. Obviously, there is a lot of travel ban and restrictions and we are not able to fly. So the headline might look a bit stunning, but actually the material impact will not be there, because hardly fresh entrants would go this year anyway, because this is a downturn year for the sector.
Of course, there could be some hit because companies must have pulled back some H1 visas to offshore, and they have to go onsite again and that might be stalled till the year end. Now we have the presidential election in November. Obviously, this rhetoric was expected, because US unemployment rate is around 13 per cent now, though actually computer-related unemployment is only 2.5 per cent. Still Trump would play to the gallery. So that was on the expected lines.
A big chunk of Indian IT employees onsite are already H1-B holders, who are already there in the US. So almost around 4.5 lakh people are there, who have visas. They will not get impacted, because these are usually given for three years, and gradually extended. So that lot will not get impacted. That is the major chunk of the workforce currently onsite. I think it might hit sentiment today for the stocks, but real business impact will not happen.
One more thing is that after Covid, the way work from home has seen traction, we had a point where 100 per cent of the employees were working from home with minimal delivery disruption. So borders might not have much significance in next few years. And this might help companies gradually come through this. Actually physical presence hardly matters for the services sector.
Obviously there will be service lines, which would require them. I am not saying it is completely not required, but we have executed this well during the lockdown through work from home. So the headline might look stunning, but the real impact will not be there on the business.
Any particular companies that perhaps may be an exception to this, or overall you feel the impact is likely to be muted anyway?
That is what I am saying. Almost all companies have almost 50 to 65 per cent local hire in large Tier I IT companies. So even the existing base has people who are there on the visas and who have renewals. All that I mean, who have relevant visas and the order clearly mentions that renewals and all will go on for those who are already in the US. The curbs are on visas for people outside the US. Currently with this Covid and all travel restrictions, travel is hardly going to take place. So I do not think it will have much impact, though sentimentally stocks might fall but the market would expect them to recover fast.
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