The Trump administration has announced a steep hike in fees for H-1B visas, sparking concern among global tech companies and Indian policymakers. The annual cost for an H-1B visa is set to rise to $100,000 per worker per year, a dramatic jump from $2,000 to $5,000 per application currently. This amounts to a whopping ₹88.1 lakh per annum.

India’s Foreign Ministry said the policy could have “humanitarian consequences”, disrupting families and affecting the strong people-to-people ties between the two countries. Nasscom, India’s IT industry body, warned that the abrupt rollout of the policy would disrupt onshore projects, create uncertainty for professionals and students, and cause ripple effects across the global job market.

The policy, which takes effect immediately, could have far-reaching consequences for India, the largest beneficiary of the programme.

What is the H-1B visa?
The H-1B visa allows US companies to hire skilled foreign professionals in specialised fields such as technology, engineering and finance. Each year, 65,000 visas are offered, with an additional 20,000 reserved for workers holding advanced degrees. The visas are typically valid for three to six years, and nearly all costs are borne by the employer.

Why is Trump raising fees?
The move is part of a wider immigration crackdown by the Trump administration, aimed at reducing both legal and illegal immigration. Commerce Secretary Howard Lutnick said the goal is to train American graduates instead of “bringing in people to take our jobs.”

Critics of the H-1B programme argue that it allows firms to suppress wages and sideline American workers. Supporters, including Elon Musk, say it is crucial for attracting global talent and keeping the US competitive in innovation.

How are US companies reacting?
Big firms such as Microsoft, Amazon and JPMorgan have warned their H-1B employees not to leave the US until further clarity emerges. Internal emails advised visa holders currently abroad to return before the new fees kicked in.

Some analysts believe the cost increase could push companies to move high-value jobs overseas, potentially hurting America’s leadership in fields like artificial intelligence. Smaller tech firms and start-ups, in particular, may struggle with the additional costs.

Impact on India
India accounts for 71% of H-1B visa holders, far ahead of China at 11.7%. Indian IT service providers like Infosys, Wipro and Cognizant rely heavily on the programme to send skilled workers to the US. Following the announcement, shares of these firms dropped by up to 5% in New York trading.

Financial and geopolitical consequences
Costs for companies: The new fee could cost firms millions annually, especially those with thousands of H-1B employees. Amazon alone had over 12,000 approvals in the first half of 2025.

Strain on US-India ties: The decision comes on top of Trump’s recent move to double tariffs on Indian imports, partly in response to New Delhi’s purchase of Russian oil.

Innovation risk: Analysts warn that while Washington may collect a windfall in fees, in the long run, the US risks “taxing away its innovation edge” by discouraging foreign talent.

What happens next?
The legality of the move has been questioned. The American Immigration Council argues that Congress only allows fees to cover processing costs, not to generate revenue. Lawsuits could follow.

At the same time, Trump has signed an executive order creating a “gold card”, offering US permanent residency to individuals who can pay $1 million,a policy many see as favouring wealth over merit.

For India, the fee hike is likely to reshape its IT industry’s US strategy, force companies to reconsider onshore deployment, and intensify lobbying efforts in Washington. Policymakers in New Delhi are now weighing the long-term impact on India’s skilled workforce, which has been a backbone of the H-1B programme for decades.