H-1B Visa Fee Hike: What It Means for India’s Tech Sector

The US government announced a big change to the H-1B visa program in September 2025. President Trump raised the visa application fee to $100,000. This fee was previously between $1,000 and $5,000.

The White House and Commerce Secretary said this new fee is to prevent companies from taking advantage of the H-1B program. They argue that some businesses use this visa to replace American tech workers with cheaper foreign employees.

Major tech companies like Microsoft and Amazon were immediately concerned. They instructed their employees with H-1B visas to either stay in the U.S. or return immediately as nobody knows what will happen next.

This news created huge problems for India’s tech industry and job market. It’s because about 71% of H-1B visas go to people from the country.

Experts believe this new rule will basically end the H-1B program because its fee is now more than what many H-1B workers earn in a year. But the U.S. government later released some important details that are worth noting for Indian citizens.

What’s Changing in the H-1B Program

This new rule from President Trump starts on September 21, 2025. And it only applies to new H-1B visa applications made after that date. Here are some key details you must know about this visa.

• This new fee only applies to new H-1B visa applications filed on or after September 21, 2025.
• It does not apply to people who already have an H-1B visa or who were approved in the 2025 lottery. They don’t need to pay it while renewing their visa or travelling outside the U.S.

• The $100,000 fee is a single payment for each new visa petition and not a yearly charge.
• The company hiring a new H-1B worker is responsible for paying this fee.

The U.S. government says that these changes were made to stop companies from using the H-1B visa to replace American workers with cheaper foreign labor. This is meant to protect American jobs and wages.

Why the U.S. is Raising the H-1B Fee

The Trump administration stated that some U.S. tech companies were firing American workers while hiring staff from other countries on H-1B visas.

• The White House cited examples of companies that fired thousands of U.S. workers but still got thousands of H-1B visas.
• Officials said that foreign workers are sometimes paid less than American workers which lowers wages. They pointed out that H-1B visa holders now hold more than 65% of some tech jobs.
• They argued that there are enough qualified American workers which points to the higher unemployment rate among recent computer science graduates.

Commerce Secretary Howard Lutnick said that companies should train new graduates from American universities instead of using foreign workers. The government said this new fee would help protect American jobs and make companies less dependent on foreign workers.

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Impact on IT Firms in India

This fee increase is a major blow to India’s tech industry as Indian companies are the biggest users of H-1B visas.

The financial impact is also huge. The H-1B visa fees would jump from $13.4 million to $1.34 billion for the top five Indian tech firms alone. This massive cost would eat up about 10% of their total profits from last year.

This news immediately affected the stock market too. Shares of major companies like Cognizant and Infosys are dropping sharply. Experts are warning of a talent crisis. They say that Indian firms will have to find new ways to hire people for their projects since U.S. companies may start hiring American workers now.

And Indian tech companies are expected to change how they do business due to this:

• This expensive new fee will make it much more costly for Indian companies to send workers to the U.S. This could make it harder for them to win American business.
  
• Companies may now relocate more work to India or other nearby countries. This results in fewer employees being sent to the U.S.
• Clients might ask for lower prices or pause projects due to uncertainty. They could even demand that more work be done from outside the U.S.

India’s main tech industry NASSCOM warned that this sudden change could cause major problems for ongoing projects. They said it would affect jobs worldwide as companies try to deal with the higher costs. Many firms will likely have fewer people in the U.S. and use more remote or nearby workers now.

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Effects on U.S. Tech and Jobs

The new visa fee is also affecting major U.S. tech companies like Apple and Microsoft.

Some experts believe that companies will only use H-1B visas for critical roles due to higher costs. They may now sponsor fewer visas for intermediate and junior positions.

And here’s what will likely happen to these companies

• Salaries are likely to increase if U.S. firms start hiring more American workers to avoid the visa fee. This could hurt profits for companies in Silicon Valley.
  
• Many people in the tech industry worry that a $100,000 fee could stop the world’s best talent from coming to the U.S. One expert has warned that this could slow down new ideas and growth.
• This sudden change in rules caused panic. Tech companies quickly warned their H-1B employees about traveling due to the confusion and fear about the new policy.

U.S. companies that use H-1B workers now have to rethink their visa plans. And many are likely to move their jobs overseas. Supporters like Elon Musk argue the program fills a skill gap. But the Trump administration says this new fee will force companies to hire and train American workers.

Indian Government and Industry Response

India’s government immediately noticed this new fee through its foreign ministry. The ministry said it is looking into the effects of the new rule. It also stressed that both India and the U.S. have a shared interest in new ideas and technology.

The government is asking to talk with the U.S. to find a solution that benefits both countries. It also warned that these high fees could create big problems for Indian families who live abroad.

Prime Minister Narendra Modi spoke about self-reliance shortly after this news. He said that the real enemy of the country is dependence on other countries. This was a clear message about reducing India’s reliance on any single foreign market or visa program.

India’s tech industry and analysts are voicing their concerns. Many experts apart from NASSCOM have pointed out that India’s $283 billion tech industry which gets more than half its money from the U.S. will have to change how it does business.

Experts in outsourcing say companies plan to send fewer employees to the U.S. and instead do more work from offices in places like India and Canada. They expect that projects will slow down because clients are either asking for new prices or waiting for the new rules to be clear.

Shares of Indian tech companies went down on Monday as investors worried about higher costs and possible project delays. The majority of experts agree that if the new policy stays in place then IT companies will have to lower their profit expectations.

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Conclusion

The H-1B visa program is a key part of the tech partnership between India and the U.S. that has helped both countries in their growth and innovation. And this new fees is a big problem for that partnership.

Indian companies will likely rely more on their teams in India and other countries. They will also need to make sure they have a strong group of skilled workers. Tech professionals should focus on learning skills for the future and looking for job opportunities all over the world.

It’s clear that the future of tech collaboration will depend on how well businesses and workers can adapt to these new changes and not just on government policy as the governments continue their discussions.

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