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The Buzz about Visas for Offshore Service Provider Personnel and the Link to On-Shore Hiring
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The press has recently given much attention to the growing difficulty of securing U.S. visas for offshore provider personnel and the impact on U.S. clients. In fact research firm CLSA Asia-Pacific released a report this past week downgrading its outlook for the Indian IT Services Sector citing “the visa issue [as] fundamentally altering the business model for Indian techs.” At the same time, an uptick in onshore hiring by many of the big name Indian providers, including Tata Consultancy Services, Aegis Communications, Genpact, Wipro, and Infosys , is making headlines. The Wall Street Journal India Real Time Blog included an entry in the past week summarizing some of the recent press on these issues .
Why is the current visa process for offshore service providers more troublesome than in the past? According to recent statistics, the rejection rate for applicable U.S. visas has increased from a reported rate of 5% to 40% over the past 18 months. The visa challenge is not limited to the United States: the United Kingdom, Switzerland and Canada also appear to be introducing more stringent caps. Conjecture that the 2012 U.S. election cycle will add greater uncertainty to the U.S. visa process for offshore providers seems to be adding to the unease. Finally, any discussion of the state of U.S. visas for offshore providers would not be complete without mentioning the accusations of visa fraud currently being leveled against Infosys . These accusations cast a further shadow on the current state of visas. All of this news seems to indicate what many clients and sourcing professionals have started to see first hand, the temporary and long term visa process in the United States is impacting offshore providers’ ability to staff their projects.
Despite the CLSA report and glum news about the state of visas for its work force, at least one overseas sourcing provider has refuted the recent publicity. Tata Consultancy has downplayed the impact of overseas visa policies noting the situation is “an irritant” and simply indicates that “staffing of engagements has to be planned better, well in advance…” . Nonetheless, in the wake of the visa issue, many of the Indian sourcing giants seem to be increasing their onshore hiring to bypass visa uncertainty. For example, Tata Consultancy released a statement in mid June noting that it will hire more than 1,200 onshore personnel this fiscal year. Similarly, Infosys has plans to hire 1,500 U.S. citizens and Aegis recently announced plans to hire approximately 10,000 U.S. citizens over the next three years. These announcements are evidence of an increasing trend toward staffing more work locally with U.S. citizens.