Donald Trump's remarks on H-1B visas triggers another day of gains for Indian IT

US President Donald Trump defended the need to have H-1B visas in an interview to Fox News on Tuesday, November 11.

Trump's remarks has led to a surge in India's IT companies on Wednesday. Gains on the Nifty IT index are being led by the Midcap names, Mphasis, LTIMindtree and Persistent Systems, which are trading with gains between 1.5% to 2.5%. Larger names like Infosys, TCS, Tech Mahindra are trading with gains of 1% each.

"You also do have to bring in talent," Trump said. “You don’t have certain talents. And you have to, people have to learn. You can’t take people off, like an unemployment line, and say, ‘I’m going to put you into a factory. We’re going to make missiles,” the US President added.

The Trump administration has increased the crackdown on immigration in his second term, imposing a $1,00,000 application fee on the H-1B visa, used mainly by the country's largest tech companies, to get in workers from other countries.

Trump's move led to the US Chamber of Commerce suing the administration, but employers have also become less eager to sponsor international students' work visas.

Indian IT companies had also responded to the developments, stating that they have significantly cut down on their dependence to the H-1B visa.

“You can’t just say a country is coming in, going to invest $10 billion to build a plant and going to take people off an unemployment line who haven’t worked in five years, and they’re going to start making missiles. It doesn’t work that way,” he added.

There was also controversy after a raid in September on Hyundai Motor Co. and LG Energy Solutions Ltd.'s electric battery plant in Georgia resulted in more than 300 South Korean workers being detained amid allegations that they were illegally in the US.

The Nifty IT index is up for the third straight day on Wednesday. The index had surged 1% on Tuesday as well on rising hopes of a trade deal between India and the US, and hopes of reduced tariffs on Indian exports. On a year-to-date basis though, the index is down nearly 17% with only LTIMindtree having positive returns.