US suspends PERM programme for major IT firms, prompting India’s IT sector to plan for shifts

GTRI said India should prepare for possible restrictions extending beyond green card sponsorship to H-1B hiring, skilled worker mobility and outsourcing

A prolonged suspension could complicate talent management, however, could accelerate the shift towards offshore delivery and alternative technology hubs, certainly benefiting India, say industry analysts

GTRI said India should prepare for possible restrictions extending beyond green card sponsorship to H-1B hiring, skilled worker mobility and outsourcing

The US Department of Labor’s suspension of major IT services and tech firms from the Permanent Labor Certification (PERM) programme has sent shockwaves through India’s tech corridor. With the primary route to employment-based green cards frozen for an estimated 100,000-plus professionals and their families, Indian IT companies and IT professionals face critical decisions regarding talent deployment, international operations and long-term career planning. Impact on IT sector The green card controversy might engender confusion for Indian technology firms that rely on qualified specialists operating in the United States. If workers experience holdups in getting their permanent residency, companies may have a hard time keeping qualified people and anticipating their workforce requirements over time. This could result in businesses solidifying their human resources in India while at the same time hiring people in the US according to their business requirements.Addressing the structural impact on IT operations, Abhijeet Kate, co-founder and principal consultant at digiCloud Solutions, said, "Uncertainty around US green card policies could push Indian IT companies to rethink how they deploy talent across markets. While the US will remain a critical market, businesses may increasingly rely on India-based delivery centres and distributed teams to manage costs and reduce dependency on employee mobility." Expressing concern for Indian professionals, Kate said, "For Indian professionals, this could mean greater uncertainty around overseas careers, but also stronger opportunities in India, particularly in technology, engineering and global capability centres." Talent and career pipelines In the case of professionals from India, the doubts regarding green card applications might impede preparations towards fruitful careers in the US. Those who depend on employer sponsorship for their residency must watch over their visa status and job security. However, Indian workers should not lose hope, as at the same time as skills development is highly important in summer study programmes in the US.Reflecting on client deployment models, Lalit Sharma, founder and CEO of Ethane Web Technologies, said, "For Indian IT companies, the bigger concern is not just whether professionals can move to the US, but how dependent their business models are on that mobility. Serving US clients increasingly requires a mix of local presence, domain expertise and cost-efficient delivery from India." He made it clear that "If immigration uncertainty persists, companies may have to rethink how they deploy talent and build client relationships, rather than simply moving more work offshore."Sharma also saw it as an opportunity for India. "For India, the opportunity is to move up the value chain by retaining skilled professionals and building capabilities that clients need, irrespective of where the work is delivered," he said. Shift in recruitment and hiring Businesses can contemplate increasing local hiring in the US for positions that need workers to be on-site and increasing their delivery teams in India. With help from Indian delivery centres and Global Capability Centres (GCCs), companies will be able to carry out technology management, research, analytics and business processes from India. Nevertheless, the decisions will also depend on labour availability, business costs, customers’ expectations and the nature of work. What lies ahead Doubt regarding laws concerning immigration adds to the cost associated with hiring and retaining personnel. Businesses should monitor immigration requirements frequently, develop flexible labour plans and obtain quality legal information for employees affected by policy changes. For India, this situation might open up chances to attract skilled professionals back to the country, preserve human talent and grow startups and GCCs. Nonetheless, this opportunity depends on India’s ability to create decent jobs, offer appealing salaries and ensure vision and career development.

Bengaluru, Oct 9: The US government’s suspension of the Permanent Labour Certification Programme (PERM) for major IT outsourcing companies could have complex and far-reaching implications for India, with the move posing challenges to traditional IT outsourcing while potentially accelerating the expansion of Global Capability Centres (GCCs) and high-value technology work in the country, Karnataka IT and BT Minister Priyank Kharge said on Friday.Responding to the development, Kharge said the suspension of the programme, a critical step for foreign workers, including H-1B visa holders, seeking employment-based green cards, could increase operating costs for Indian IT companies in the United States, make it more difficult to retain skilled employees and reduce flexibility in deploying Indian professionals onsite.However, he said the development could also create opportunities for India as a global technology hub.#WATCH | Bengaluru | On US Green Card Program suspension for major IT firms, Karnataka Minister Priyank Kharge says, "The American administration's decision to suspend Permanent Labor Certification for major IT companies is a complex issue. While temporarily they might not have many repercussions, I think the IT companies of India will have to be better prepared for the way forward, and this will result in higher skill retention rates. It will definitely be more expensive to operate overseas. But I see a flip side of possibly climbing up the value chain, with more high-end jobs coming to where talent is, that is India, and more particularly Bangalore. The most underlying point that needs to be addressed here is the continued failing diplomacy of Mr. Modi. The India-U.S. trade deal has not been fair to us. I don't understand how the deep friendship of Mr. Modi and Mr. Trump is actually helping India."— ANI (@ANI) October 9, 2026Shift could boost high-value work“If moving Indian engineers to the United States becomes more difficult and expensive, more high-value work may increasingly move to where the talent already is available,” Kharge said.India's National Security Comes First, Rajeev Chandrasekhar Says Amid Elon Musk Starlink Approval RowHe said the shift could accelerate the expansion of GCCs in India and encourage global companies to move more research and development (R&D), engineering and product development mandates to Indian cities.The development could also increase domestic demand for senior technology professionals and strengthen India’s position in the global technology ecosystem, he said.India eyes global innovation leadershipAccording to Kharge, India has an opportunity to move beyond its established role as a major provider of IT services and emerge as a global centre for product development, artificial intelligence (AI), deep technology and innovation.He said the implications of the US decision would therefore extend beyond the immediate challenges faced by Indian IT outsourcing companies, potentially influencing how global technology firms distribute their operations and specialised work across countries.Also Watch:Restrictions could accelerate technology expansionThe minister’s remarks highlighted the possibility that restrictions affecting the movement and retention of skilled Indian professionals in the United States could encourage companies to expand technology operations within India, where a substantial talent pool is already available.While the suspension could create near-term challenges for Indian IT service providers with significant US operations, it could also provide an impetus for India to attract higher-value technology functions and strengthen its role in global research, engineering and innovation.(Except for the headline, this article has not been edited by FPJ's editorial team and is auto-generated from an agency feed.)

The US government's decision to suspend several major technology companies from its Permanent Labour Certification (PERM) programme could create challenges for Indian IT exporters while opening new opportunities for technology development in India, Karnataka IT Minister Priyank Kharge said on Friday.In a post on X, Kharge said the restrictions could accelerate the movement of high-value engineering, research and product development work to India.Karnataka, which accounts for approximately 40% of India's IT and software exports, could be particularly affected by changes in global technology hiring.The US government’s suspension of the Permanent Labour Certification Programme for major IT outsourcing companies, a critical step through which foreign workers, including H-1B visa holders, pursue employment-based green cards could have consequences for India that are both…— Priyank Kharge / ಪ್ರಿಯಾಂಕ್ ಖರ್ಗೆ (@PriyankKharge) October 9, 2026 Restrictions may raise costs for Indian IT firmsThe PERM programme forms an important part of the employment-based Green Card process in the United States.It requires employers to establish that hiring foreign workers for permanent positions will not adversely affect the wages and working conditions of American employees.Kharge warned that restrictions could increase operating expenses for traditional Indian outsourcing companies.They could also complicate employee retention and reduce flexibility in deploying skilled professionals to US client locations.According to the US Department of Labor, companies affected by PERM participation restrictions include Microsoft, Adobe, Cognizant, Infosys, Tata, Wipro, HCL and Capgemini.The development comes amid increased scrutiny of H-1B hiring and employment-based immigration programmes by the Trump administration following allegations of misuse. India could attract more GCCsDespite the potential difficulties for outsourcing businesses, Kharge believes the restrictions could strengthen India's position as a global technology destination.If relocating engineers to the US becomes more expensive or difficult, multinational companies may increasingly assign sophisticated technology projects to Indian operations.This could accelerate the expansion of global capability centres (GCCs), which support multinational businesses through engineering, analytics, research and technology development.Kharge said the shift could generate greater demand for experienced professionals and attract additional mandates in artificial intelligence (AI), deep technology and product innovation.Such developments could help India move beyond conventional IT services towards higher-value technology activities.However, the minister cautioned that India must improve its preparedness to capitalise on these opportunities as international companies reconsider their workforce and investment strategies.

Tighter mobility conditions could accelerate GCC expansion, bring more global research and development mandates to Indian cities, and increase domestic demand for senior technology professionals, anticipates Priyank Kharge