Indian IT firms increase subcontracting amid US visa, AI demand
Indian IT companies are turning more to subcontractors lately, thanks to ongoing US visa issues and a big jump in demand for AI services.
In the latest quarter, all four top IT firms reported higher subcontracting costs, some up by as much as 52%, marking six straight quarters of increases following fiscal 2025.
US $100,000 H-1B fee cited
The spike in costs traces back to stricter US immigration rules, especially a hefty $100,000 fee for new H-1B applications.
With hiring abroad tougher and clients wanting faster AI project turnarounds, companies like TCS, Wipro, Tech Mahindra, and HCLtech are relying more on local talent through subcontractors, even if it means paying extra.
As Aditya Narayan Mishra, MD and CEO of CIEL HR, puts it, "H-1B pressures have surely played a role. The green-card route was also an attractive long-term option for people from India but it has also become less attractive now. Companies will have to hire local talent."