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The US administration has suspended Microsoft, Adobe and six major IT companies from the PERM

ICICIdirect Research 09 Oct 2026 DISCLAIMER

News: The US administration has suspended Microsoft, Adobe and six major IT companies including TCS, Infosys, Cognizant, Wipro, HCLTech and Capgemini from the PERM (Permanent Labor Certification) programme, which is a key step for employment-based green-card sponsorship. The suspension blocks new applications and processing of pending PERM cases for the targeted companies, with the administration citing alleged misuse of the immigration system. The development does not directly affect existing H-1B work authorisations, but restricts the pathway from temporary work visas to permanent residency. According to the US Labour Secretary, the companies had collectively sought nearly 3 million foreign workers since 2009, including more than 230,000 H-1B approvals and over 100,000 permanent labour certifications. 

View: The development is negative for Indian IT stocks in the near to medium term, primarily through sentiment and longer-term talent-retention concerns rather than an immediate revenue impact. Importantly, Indian IT companies have very limited dependence on the PERM route, accounting for less than 2% of the 117,849 PERM applications filed between October 2024 and September 2025; Infosys had no PERM cases since 2022, while Wipro, TCS and HCLTech received only 523, 513 and 393 permanent-residency approvals, respectively. Thus, the direct financial impact should remain limited initially as existing H-1B employees can continue working and Indian IT companies have already been reducing dependence on H-1B visas through localisation and offshore delivery. However, if prolonged, uncertainty around permanent residency could increase attrition among experienced US-based talent and force greater reliance on local hiring and offshore delivery, creating potential cost and margin pressure over the medium term. Moreover, any extension into broader work-visa restrictions would pose a more material risk. 

Impact: Negative

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