The United States’ decision to replace the long-standing H-1B visa lottery with a wage-weighted selection mechanism has triggered sharp reactions from India’s technology industry, with Nasscom warning that the shift raises legal, economic and operational concerns.
In a statement issued on Wednesday, the Indian IT industry body said the move marks a clear break from a neutral system that has been in place for years.
The concern gains weight as the Trump administration moves away from a random lottery and towards a model that prioritises higher-paid and higher-skilled applicants.
The policy change comes at a time when Washington is tightening scrutiny of both legal and illegal immigration, while also placing the H-1B programme under a sharper lens. Indian professionals form a large share of H-1B visa holders, making the issue particularly sensitive for India’s technology sector.
Nasscom said that if a wage-weighted approach is pursued, a phased rollout with adequate lead time would be “essential”.
It argued that delaying implementation until the FY28 lottery cycle would give employers time to adjust internal processes, ensure compliance and retain confidence in the stability of the US talent and investment climate.
Expressing concern over the design of the new system, Nasscom said that assigning multiple selection entries based on Occupational and Employment Wage Statistics levels risks shifting the focus away from the statutory definition of “speciality occupation” and towards wage ranking.
Such a shift, it warned, could lead to regional and occupational distortions. Wage levels differ widely across locations and roles in the US.
A weighted model could therefore put small and mid-sized firms, startups, research institutions and university-linked employers at a disadvantage, as many of them operate on moderate but market-aligned wage structures.
“Though the intent behind the proposed changes to promote high-skill employment, curb misuse, and protect US wages is well understood, a transparent, trusted visa framework is essential to maintaining the strength of the US technology ecosystem,” Nasscom said.
Under the current plan, the final rule will come into effect on February 27, 2026, and will apply to the FY 2027 H-1B cap registration season.
Nasscom reiterated that the changes represent a departure from the neutral lottery system and raise questions that go beyond policy intent.
While H-1B professionals make up a small share of the overall US workforce employed by Nasscom member companies, the industry body said their contribution to innovation, productivity and job creation across the digital economy is substantial.
According to Nasscom, H-1B petitions at Level I and Level II wage bands often correspond to entry-level roles filled by graduates of US universities in science, engineering and computing.
These roles are a key part of the STEM talent pipeline, allowing early-career professionals to gain industry experience and move into mid- and senior-level positions over time.
Limiting entry-level opportunities through a wage-weighted system could weaken this pipeline, Nasscom warned.
It could also deter international students from pursuing advanced education in the US, running counter to the country’s stated goals of strengthening competitiveness, driving innovation and supporting higher education.
“Further, a sudden shift to a wage-weighted model would introduce uncertainty, increase compliance complexity, and disrupt long-established workforce planning, particularly for smaller and mid-sized firms that align recruitment with academic calendars, client delivery schedules, and product release cycles,” it said.
Nasscom also highlighted the role Indian technology companies play in the US economy.
Its member firms support more than 1.6 million skilled jobs across the country and contribute USD 198 billion to US GDP, an impact larger than that of over 20 US state economies.
“With over 2,64,500 employees directly in the US and a presence in more than 25 major American communities, Nasscom companies help strengthen both established and emerging technology hubs. Notably, more than two-thirds of these jobs are located outside Silicon Valley and New York, fostering inclusive growth in regions such as Texas, North Carolina, Ohio, and Illinois,” Nasscom said.
The industry body stressed that any structural reform of the H-1B programme must preserve predictability, equity and alignment with existing law.
It also referred to a joint US congressional letter issued on October 30, 2025, which noted that Indian nationals, who form the largest share of H-1B recipients, are central to US leadership in information technology and artificial intelligence.
Nasscom said the US must continue to attract global talent to sustain its innovation ecosystem, strengthen its defence industrial base and maintain its competitive position over the long term.
For India, which accounted for 71 per cent of H-1B holders last year, the mobility of skilled professionals also reinforces strategic ties with a key democratic partner in the Indo-Pacific region.
“A balanced, consultative approach will be critical to ensuring that reforms strengthen rather than inadvertently weaken the innovation advantage and global competitiveness of the United States,” Nasscom said, adding that the H-1B programme is about more than filling labour gaps, it is linked to US leadership in sectors that will shape global power in the 21st century.
The latest move adds to existing anxieties within India’s USD 280 billion IT industry, which is already grappling with a record USD 1,00,000 visa fee and concerns over a possible 25 per cent HIRE outsourcing tax.