world · 2026-10-09
US halts visa program for Indian IT firms, Microsoft
Photo: Wikimedia Commons
The US suspended a work visa program for Microsoft and Indian IT firms, accusing them of abusing the system. This hits India's tech industry hard, as thousands of workers rely on US visas for jobs.
What program has specifically been suspended?
The US suspended eight tech firms, Microsoft, Adobe, Cognizant, Infosys, TCS, Wipro, HCL and Capgemini, from the Permanent Labour Certification Programme (PERM), the first step toward a green card. The Department of Labor, announcing the indefinite suspension on Thursday, said it will accept no new PERM applications from them and will not process pending ones.
Are new green cards blocked and existing applications frozen too?
Yes, both. The Labor Department will not accept any new PERM applications from these eight companies, and will not process pending ones either. PERM is the first step toward a green card, so this freezes their path to permanent residency indefinitely.
How big are Indian firms in this visa program?
Very big. In 2024, Infosys had 8,140 H-1B approvals, Cognizant 6,321, TCS 5,274, HCL America 2,953 and Wipro 1,634. Indian nationals account for more than 70% of approved H-1B petitions annually. Microsoft had 4,725, and Amazon, the online retailer, topped all companies with 9,265.
Are the suspensions based on allegations or proven findings?
The suspensions are based on allegations, not proven findings. Labor Secretary Keith Sonderling and Vice President JD Vance announced the indefinite suspension alongside multiple active federal investigations. No findings have been announced, and the companies have not responded publicly. The administration has not presented evidence, only accusations of fraud in the companies' applications.
Are these workers effectively stuck?
Yes, in a narrow sense. H-1B visa holders' ability to switch employers is sharply limited: only 63,865 of 680,000 switched jobs in FY2024, a 9.4% rate versus 20-25% for comparable American workers. Now their green card path through these eight companies is frozen, and pending PERM applications won't be processed.
What is PERM and how is it different from the H-1B visa?
PERM is the first step toward a green card, not a work visa like the H-1B. Through PERM, an employer certifies to the Labor Department that no qualified American worker was available for a job. Once granted, the company can sponsor the foreign worker for permanent residency. The H-1B, by contrast, is a temporary work visa.
Why did Vance single out Microsoft?
Vance said no company in the US has abused the system more than Microsoft. He cited that Microsoft laid off about 6,000 American employees in 2025 while getting approval for more than 6,000 H-1B visas and filing 3,682 PERM applications. He claimed nearly 1,000 of those applications were for roles similar to the laid-off positions. He also noted the suspension came hours before President Trump was to honour Microsoft's CEO Satya Nadella with a National Medal of Science award.
Is there evidence companies defrauded American workers?
Evidence suggests the gap is not from fraud. H-1B workers earn about 11% less than comparable natives, but that gap comes from visa rules that tie workers to their employer, not from companies lying. Workers' pay rises once they get permanent residency, which points to market power, not fraud, in the system.
What happens to Indian workers who can't get green cards?
H-1B workers who don't get green cards can stay only as long as their temporary visa lasts. Switching employers is hard: only 63,865 of 680,000 H-1B workers switched jobs in FY 2024, versus 20-25% for comparable American workers. With PERM frozen, their path to permanent residency is blocked.
Can US tech firms cope without Indian talent?
Not easily. Data suggests a skills mismatch, not just a supply gap. H-1B workers are heavily concentrated in software development, 38.3% versus 4.2% of native workers, and they fill specialised roles that American workers are not readily available to fill. The firms would struggle to find a ready pool of American replacements.
Source: livemint.com