IT Firms: Tata Consultancy Services, Cognizant & Infosys See Higher H-1B Visa Rejections Over American Technology Firms

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| March 8 , 2019 , 12:16 IST

Tata Consultancy Services, Cognizant and Infosys have seen the highest rejection in the extension of H-1B work visas during 2018 as the Trump administration tightened procedures for the grant of these visas, a move that is seen to have favored American technology firms over Indian IT services firms.

India’s top IT services companies Infosys and TCS were among the most affected. Bengaluru-based Infosys saw 2,042 rejections, followed by TCS at 1,744. The numbers were put out by the center for immigration studies, a US think tank, after an analysis of the H-1B data.

Six outsourcing companies - TCS, Infosys, Wipro, Cognizant and the US arms of Tech Mahindra and HCL Technologies accounted for nearly two-thirds of the rejection of extensions for the top 30 companies, the think tank said analyzing US Citizenship and Immigration Service (USCIS) data.

The six firms got just 16% or 2145 H-1B work permits, less than the 2399 visas that Amazon, the world’s largest online retailer bagged in 2018.

The H-1B visas, the work permit used by the majority of technology professionals, is initially given for three years with an opportunity to extend for a similar term.

The major US-based firms, such as Microsoft, Amazon, and Apple, increased their H-1B workforces during the year, while net reductions were imposed on the big Indian outsourcing firms, such as Cognizant, Tata, and Infosys, the think tank said in its study on March 6.

TCS, Infosys, Wipro, and Cognizant declined to comment. HCL Technologies could not comment immediately.

Experts are of the view that “increased scrutiny or adjudicatory standards” for Indian IT services companies could impact the growth of businesses especially at a time when Indian IT firms have drastically reduced fresh H-1B work petitions.

Shivendra Singh, Head of Global Trade Development at National Association of Software and Services Companies, the software lobby, said, “there are data points that say there is a skill shortage in the US.

"If there is a challenge to the process of bridging the gap then it is going to impact the competitiveness of the economy. That is something we have been highlighting for some time” Singh added.

In January, the US introduced a new rule effective April that will include work visa petitions of US advanced degree holders for the lottery of the first 65,000 caps of H-1B visas.

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This would favor US companies looking for Indian talent over Indian IT services companies that largely employ those holding a bachelor’s degree.

However, legal experts point out that with Indian IT companies being the largest consumers of the H-1B visas, it follows that the increase in (overall) rejections will result in an increase of absolute numbers for the Indian IT companies.

“I do not think it is targeted at certain companies or any nation,” said Poorvi Chothani, Managing Partner, LawQuest, a global immigration and employment law firm.

“The USCIS in October 2017 had instructed its officers to conduct the same level of review for extension of non-immigration visas similar to that of new petitions and the rejections could have gone up because of this,” said Chothani.

She also pointed out that some of the rejections may also be influenced by the current administration's Buy American Hire America diktat conceding, however “that it is hard to determine.”

This trend of US favouring US companies over Indian ones is not a new phenomenon according to outsourcing industry experts.

“Protectionism happens without making any policy changes to favour their own companies. This slant is not unusual. This has happened under President (Barack) Obama, not just under (Donald) Trump,” said Sid Pai, founder of Siana Capital, who has led outsourcing deals of over $ 20 billion in the past.

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“It is not just in the US, even Singapore and Australia have this slant to support their companies and their interest” Pai added.