Suspension on expedited H-1B visa to affect IT companies: Nasscom

New Delhi: Industry body Nasscom on Sunday said that US' decision to temporarily suspend the expedited premium processing of H-1B visas will lead to process delays for Indian IT firms too.

However, Nasscom feels that the move will not be a significant impediment for the over USD 110 billion outsourcing industry.

The US has announced that from April 3, it would temporarily suspend the 'premium processing' of H-1B visas that allowed some companies to jump the queue, as part of overall efforts to clear the backlog.

The suspension came even as New Delhi pressed for a fair and rational approach on the matter from a trade and business perspective.

"The current issue of the temporary suspension of premium H-1B processing will create some process delays for the companies ? Indian and American -- but is not a significant impediment," Nasscom said in an emailed statement.

By paying an additional premium of USD 1,225, companies could get an H-1B application processed within 15 days, whereas a standard process takes 3-6 months. The temporary suspension of the fast-track processing of the H-1B visas widely used by the Indian IT industry may last six months.

The decision was announced just hours after top Indian officials -- Foreign Secretary S Jaishankar and Commerce Secretary Rita Teotia -- held meetings with officials and lawmakers in the US to view the H1-B visa issue as a trade and services matter, and not an immigration one.

It also puts pressure on Indian IT companies as any changes in visa regime may result in higher operational costs and shortage of skilled workers for the Indian outsourcing industry.

In the past few weeks, there have been proposals to overhaul the popular H-1B visa regime through various legislations which have added to the worries of the Indian IT sector that is battling slower growth, currency fluctuation and cautious client spending. The US accounts for over 60 per cent of the Indian IT export revenues.

Nasscom said it will work with the US Embassy in India to ensure that movement of professionals is not hit by such process issues.

"This has happened in the past for a couple of months to clear the backlog and we will work with the US Embassy in India to enable mobility of skilled talent is not impacted due to process issues," Nasscom added.

Gartner Research Director DD Mishra, however, said the move will have an immediate impact on the capability of Indian IT companies to respond to urgency, thereby impacting some agility and speed.