Tata Consultancy, Infosys, Wipro Fall in Mumbai on U.S. Visa Cost Concerns
Tata Consultancy Services Ltd., Infosys Technologies Ltd. and Wipro Ltd., India’s largest software exporters, fell in Mumbai trading after the U.S. Senate passed a bill that could double work-visa costs.
Tata Consultancy fell as much as 2.2 percent, the biggest intraday drop since July 13, and traded 0.3 percent lower at 862.10 rupees as of 9:56 a.m. local time. Infosys declined 0.4 percent to 2,853.75 rupees and was the biggest contributor to the benchmark Sensitive Index’s less than 0.1 percent drop. Wipro lost 0.9 percent to 429.10 rupees, making it the worst performer on the Sensex.
The bill, passed unanimously by the Senate last week, would add $2,000 in per-visa fees for companies with more than half of their employees in the U.S. on such visas. Software exporters typically pay about $2,000 per visa application now, Bhavtosh Vajpayee, head of technology research at CLSA Ltd. in Hong Kong, wrote in a note to clients dated today.
“While the margin hit is manageable and not as much of an issue, we remain worried by such direction of visa legislation,” Vajpayee wrote. “The passage of this bill will likely enthuse those supporting employment protectionism and encourage similar pieces of legislation which combine unrelated things and impose non-tariff barriers.”
The Senate fee increases are aimed at helping to fund a $600 million effort to boost security at the U.S.-Mexican border. Sen. Charles Schumer of New York, who’s sponsoring the bill, said the technology-services companies add to unemployment in the U.S. by outsourcing jobs to foreign workers.
Technology companies such as Tata, Infosys and Wipro bring skilled workers from overseas, often from India, into the U.S. to develop software and manage projects for customers in the country. The bill, if approved by the House of Representatives, could cost such companies a total of as much as $250 million a year, according to Som Mittal, president of Nasscom, a trade association for Indian information-technology companies.
To contact the reporter on this story: Ketaki Gokhale at email@example.com.