Trump’s visa hike spurs India’s AI, SaaS talent push for startups
H1-B visa fee impact: Startups will avoid costly sponsorships and instead lean on offshore teams, remote contractors, and gig talent
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Indian startups are set to witness constructive yet testing effects following the Trump administration's latest ruling on H1-B visas. Earlier this week, US President Donald Trump announced an explosive order--a steep $100,000 fee for H-1B visas, widely used by technology companies to hire talent from abroad.
This comes close on the heels of the administration's last month's move to impose 50% tariffs on Indian imports, sending fresh tremors through the Indian economy.
Industry experts told Storyboard18 that the new order poses a significant challenge for Indian startups, particularly those relying on deploying talent onsite at client locations in the US.
According to Kamal Karanth, co-founder of specialist staffing firm Xpheno, "The increased cost of sponsoring fresh H-1B applicants will make it harder for startups—already operating under funding constraints—to station employees abroad. The move will now limit hiring or retaining top talent through international opportunities".
Aditya Narayan Mishra, MD and CEO of CIEL HR, added that many startups will likely scale back US hiring, delay expansion plans, or push roles back to India. "The immediate effect will be a sharp decline in visa-backed hiring in the US. Startups will avoid costly sponsorships and instead lean on offshore teams, remote contractors, and gig talent," he said.
According to the startups data, exclusively shared by Tracxn, shows that 97 Indian startups have operations in the US-including MakeMyTrip, upGrad, Zeta, with many backed by US-based investment firms such as Tiger Global Management, Celesta Capital, Accel, Better Capital, among others.
'Potential turning point'
In hindsight, the H-1B visa fee hike could prove a landmark moment for Indian startups. Ritika Gupta, CEO & Counsellor, AAera Consultants, pointed out, "Startups that promote flexible work culture, equity-based incentives, and speed up skills development could turn this regulation into a competitive advantage".
CIEL's Mishra noted that the change may encourage high-end professionals to stay in India, attracted by strong career stability. At the same time, "It could also rewire where innovation takes place, with more product development and engineering staying rooted in India rather than migrating to Silicon Valley", he added.
Kapil Joshi, CEO - IT Staffing, Quess Corp, believes that startups will step up hiring from the domestic talent pool, skilled in AI, SaaS, and deep-tech. This will also intensify healthy competition for top talent. "Startups may have to offer sharper career growth opportunities, flexible work models, and competitive pay to retain high performers, Neeti Sharma, CEO, TeamLease Digital, said.
Anil Agarwal, CEO and co-founder of Incruiter, added that compensation won't be enough. "Beyond salaries, startups will need to emphasize equity, faster growth paths, flexible work models, and cutting-edge projects to keep top talent engaged".
