Indian Tech Stocks Slump Nearly 3% After Trump Imposes Hefty H-1B Visa Fee

Sector under pressure as $100,000 fee on new H-1B visas clouds margins and business model

Indian IT firms saw a sharp drop Monday after President Donald Trump’s administration announced a new $100,000 fee on applications for new H-1B work visas, a move that could upend the traditional model many companies use to supply skilled labor to U.S. projects. The visa-sensitive Nifty IT index fell about 2.6–3%, led by large caps such as Infosys, TCS, Wipro, and mid-tiers including Persistent Systems.

What The Policy Does & Why It Matters

• The new fee applies only to new H-1B visa applications and not to renewals or holders of existing visas.
• India is a major beneficiary of H-1B visas: over 70% of approved H-1B beneficiaries in recent years have been Indian nationals.
• India’s IT sector gets about 57% of its revenue from the U.S. market, making it particularly exposed to disruptions in U.S. worker mobility and visa policy.

Market Reaction

• Major IT stocks such as Infosys, TCS, Wipro, and HCLTech dropped around 2–3%; mid-tier firms saw steeper losses, Persistent Systems led with about a 4% drop.
• The broader Nifty IT sub-index slumped nearly 3% as all 10 of its constituent stocks registered declines.
• The benchmark indices (Nifty 50, BSE Sensex) moved down modestly, dragged by the tech sector’s slide.

What This Means for Indian Tech Firms

• The cost structure for on-site (U.S.) project delivery may increase substantially; firms will need to revaluate how many employees they can send abroad vs doing work offshore or nearshore.
• Pricing pressure could rise: some clients may demand cost pass-throughs or renegotiations if labor costs increase.
• Risk to project timelines: with uncertainty around visa issuance, some work may have to be paused or delayed, especially where presence in the U.S. is required.

Risks & What to Monitor

• Legal and regulatory pushback: Some industry bodies and affected companies are expected to challenge the fee in court or seek exemptions.
• Clarifications from U.S. authorities: The initial confusion (e.g. over whether renewals or existing visas were affected) has unsettled markets. How the rule is implemented will matter.
• Client behavior: Some U.S. companies might accelerate hiring U.S. nationals or green card holders, or hot-swap roles away from H-1B substitution.
• Margin and revenue impact: Especially for mid-tier firms with less cushion, profitability may be squeezed if they cannot offshore work or reduce dependence on on-site staffing.