H-1B Squeeze: Indian IT's Onsite Model Is Being Redesigned

The Trump administration's layered H-1B restrictions — $100,000 fee proposals, wage-weighted lottery, OPT/STEM-OPT fee proposals and tighter compliance scrutiny — are dismantling the traditional Indian IT onsite pathway. Indians took roughly 70% of the 406,348 approved H-1B petitions in FY2025, with computer-related roles at 62%. The sharpest signal: H-1B registrations by the top six Indian IT firms collapsed 92% for FY27 to 1,763. Senior, highly paid engineers are relatively insulated under wage-weighting, but early-career workers and the volume-based IT services staffing model are being squeezed hardest. The emerging model is US local hiring for client-facing roles plus a much larger India-based engineering and delivery footprint. Key signal: H-1B registrations by TCS, Infosys, HCLTech, Wipro, LTIMindtree and Tech Mahindra plunged 92% for FY27 to 1,763 from 21,919 a year earlier. For hiring leaders, this matters because for CHROs and GCC leaders, this is not a visa story — it is a demand relocation story. Work that used to travel on H-1B is being pulled back into India: engineering, AI, data science, cloud, cybersecurity and product development. That means aggressive competition for senior India-based talent, upward pressure on compensation for scarce skills, and a structural shift in how IT services firms price and staff US engagements. Firms still running an onsite-heavy pyramid need to re-plan talent supply now. The winners will be those who build India-based delivery depth in high-value skills before their competitors finish the same math. Teksands view: The 92% collapse in Indian IT H-1B registrations is the number to watch. It confirms the body-shop model is dead, not dying. For recruiters, the implication is blunt: the same engineers who would have been deployed to the US are now competing for India-based roles — but only the high-skill ones. Junior, generalist profiles face a double squeeze: fewer onsite slots and more competition. If you are hiring in Bengaluru, Hyderabad or Pune for AI, cloud or cybersecurity, expect a deeper but more selective candidate pool. Screen for depth, not pedigree.