India’s largest IT services companies are facing one of their toughest years in the United States talent market.
The top seven Indian IT services firms together secured just 4,573 new H-1B approvals in FY 2025, marking a 10-year low and reflecting a significant shift in US visa dynamics, rising scrutiny, and changing global delivery models.
Sharp Decline in H-1B Allocations
Over the past decade, Indian IT companies have relied heavily on the H-1B visa to deploy skilled workers onsite for major US clients across banking, healthcare, manufacturing, and retail.
But FY 2025 data shows a dramatic decline in approvals, indicating a tightening environment under evolving US immigration policies.
The combined approvals for FY 2025 are less than half of what these firms typically secured annually during the mid-2010s, when numbers often ranged between 10,000 and 15,000.
The fall highlights stricter scrutiny by US authorities, a growing preference for local hiring, reduced filings due to changing work models, and heightened competition from other global tech and consulting firms.
Why the Numbers Plunged
Industry experts attribute the slump to several overlapping factors. Regulatory tightening in the US over the years has increased oversight on outsourcing-heavy H-1B employers, with immigration authorities demanding more evidence of specialized skills, client-site documentation, and strict wage compliance.
This high level of scrutiny has narrowed the approval rate for companies dependent on large-scale onsite staffing.
At the same time, Indian IT majors have been pushing toward local hiring, investing in US-based talent and expanding their delivery centers across the country. This shift has reduced their reliance on H-1B visas and consequently lowered the number of applications they file.
The industrywide adoption of offshore execution, hybrid work, and AI-driven delivery models has also diminished the need to send large teams onsite.
In addition, the political climate in the US has become more sensitive to foreign worker programs, influencing visa adjudication trends in subtle but significant ways.
Impact on Indian IT and Global Operations
The decline in H-1B approvals is prompting Indian IT companies to further recalibrate their global talent strategies. Many are expected to accelerate US hiring, which may increase their cost structures.
More project execution is likely to shift offshore, with India continuing to serve as the backbone for large transformation programs.
Companies are also expected to expand operations in Canada, Mexico, Poland, and Eastern Europe to diversify their talent pools.
As the cost of onsite staffing rises and visa unpredictability continues, firms are investing heavily in automation and generative AI to balance productivity and workforce needs.
Despite the fall in visa approvals, the US remains the most critical market for Indian IT companies, contributing between 50 and 60 percent of their total revenues.
Their ability to adapt to these changes while sustaining client relationships will determine their competitiveness in the years ahead.
What Lies Ahead
With the FY 2026 H-1B cycle already underway, companies are watching closely to see whether this downward trend continues or stabilizes.
The outlook will depend on US policy decisions under the new administration, the speed at which global tech spending picks up, and how quickly enterprises adopt AI and cloud technologies.
For now, the historic low of 4,573 new H-1B approvals stands as a clear indicator of how sharply the US visa landscape has shifted for the Indian IT industry.
