US banks lean on India hubs as Trump pledges visa fees

Core Viewpoint - Wall Street banks are expected to increase reliance on their Indian business support centers due to new fees imposed on the H-1B visa program, which could lead to a deeper presence in Indian tech hubs [1][3][9] Group 1: Impact of H-1B Visa Changes - The new $100,000 fees on H-1B visa applications may drive banks to expand operations in India, particularly in cities like Mumbai, Bengaluru, and Hyderabad, which already employ over 1.9 million people [1][3] - Indian-born workers represented 72.3% of all H-1B beneficiaries in the US fiscal year ending September 2023, highlighting the significance of this visa program for the tech and finance sectors [4] Group 2: Growth of Global Capability Centers (GCCs) - The GCC market has reached a value of $64 billion, with an annual growth rate of approximately 9.8% projected from 2019 to 2024, and is expected to grow to $110 billion by 2030 [5] - The number of GCCs is anticipated to increase from 1,700 to as many as 2,500 by 2030, indicating a robust expansion in this sector [5] Group 3: Employment Trends in US Banks - Major US banks like Citigroup, Bank of America, and JPMorgan Chase are significant employers in India, with Citigroup employing around 33,000 staff, Bank of America over 27,000, and JPMorgan 55,000 [6] - A study indicated that companies often hire more staff abroad in response to restrictions on skilled immigration, suggesting that banks may adjust their strategies accordingly [7] Group 4: Strategic Adjustments and Future Outlook - Banks are likely to recalibrate their strategies for GCCs, potentially adding new job functions in India, but will wait for more clarity on the evolving situation [7] - The new H-1B restrictions are expected to accelerate India's role as a hub for critical business functions, compliance, technology, and innovation for international banks [9] - Despite the potential for expansion, uncertainty regarding further US measures may temper banks' global strategies [10]