The US government has suspended several major Indian IT companies from a key program that allows skilled foreign workers to gain permanent residency.
The Trump administration has cited alleged fraud alleging that jobs were given to foreign workers at the expense of American workers.
On this comment of the US Labor Minister, India's Foreign Ministry said in a statement on Friday that these steps do not help in furthering the common ambitions of the two countries.
The Indian External Affairs Ministry also hit back at US Vice President JD Vance's comments.
The Ministry of External Affairs described his comments as inappropriate and extremely insulting.
Vance took aim at Microsoft in announcing the suspension, saying companies should hire the best American workers instead of hiring foreign forced laborers.
On this, India's Ministry of External Affairs said, "America's own history has been created by generations of immigrants. Their labor, entrepreneurship and innovation have contributed to the country's prosperity and progress. Using such words, which reflect the painful and colonial legacy of history, is extremely insulting."
US Labor Secretary Keith Sonderling said, "I am suspending some of the world's largest IT outsourcing companies - Cognizant, Infosys, Tata, Wipro, HCL and Capgemini - from the Permanent Labor Certification Program."
“These are companies that have made this abuse possible for decades,” Sonderling said. I am suspending these companies from the Permanent Labor Certification Program (PERM). Additionally, the Department of Labor is also suspending Microsoft and Adobe from the program due to multiple active federal investigations."
“The Trump administration knows that American workers are the best and brightest in the world,” Keith said during the announcement. These jobs taken away from them should have gone to Americans first and will still go to Americans first, not to foreigners and especially not to foreigners who commit fraud. Today, thanks to President Trump, the Vice President, and the task force, we are removing the head of the snake."
Keith has said in English – We are cutting off the head of the snake. The meaning of this phrase is 'we are striking at the root of the problem' but many people in India are taking it literally and seeing it as derogatory language."
Rezaul Hasan Laskar, international editor of Hindustan Times, wrote on X regarding Keith's comment, "I don't remember the last time something related to India was called 'the head of the snake'."
Indian-American entrepreneur Vivek Wadhwa has written on this announcement of the Trump administration, "America has got the highest free profit in history. Highly skilled immigrants came to America on the basis of their talents. But now America is turning its victory into defeat by showing the best and brightest people out. These companies are not going to abuse Visa. In fact, those who take advantage of the system are those companies who misuse this system in the name of providing employees on contract. Such companies should be closed down."
On Keith's 'The Head of the Snake' comment, Major General Yash Mor, a peacekeeper in the UN, has written, "This is a very low level attack." Hopefully we will give a concrete answer to this, because this kind of language is unacceptable. This is a direct attack on the Indian IT sector and our economy."
This step of the Trump administration is being considered as a big blow for Indian professionals who want to work with these companies in the US.
In the US it is also called Program Electronic Review Management (PERM). This is an important arrangement, under which American employers provide permanent residence to foreign employees. Many Indian IT companies also use this system.
Last month, the US had announced the suspension of Cognizant from this process. However, no details were provided at the time regarding the allegations made against the company, the number of applications affected or the length of the suspension.
Vice President JD Vance and Keith Sonderling made the announcement on Thursday.
"Unfortunately, no company in the United States has abused this system more than Microsoft," Vance said.
In a statement, Microsoft defended its use of the Visa programs and said it stood ready to provide additional information to the administration.
Vance's comments criticizing Microsoft came just hours after President Donald Trump awarded the company's CEO Satya Nadella the National Medal of Technology and Innovation during a summit in Washington.
Only last week, Nadella participated in a luncheon organized at the White House with the heads of other tech companies. In this meeting, security measures for Artificial Intelligence i.e. AI were discussed.
The Mint has written in one of its reports that the US administration's attempt to stop the process of obtaining permanent residence for immigrants working on H-1B visa may not have much impact on Indian IT services companies.
The reason for this is that the process of obtaining permanent residence through this route had already almost come to a standstill.
When filing a PERM application, the employer must advertise the job vacancy, consider applicants, and provide documentary evidence as to why qualified US workers were not selected.
It also has to be proven that hiring a foreign employee will not adversely affect the wages or working conditions of American employees.
According to US Labor Department data, of the total 1,17,849 permanent labor certification applications filed between October 2024 and September 2025, the combined share of Indian IT companies was less than 1,400, or less than two percent.
This is the most recent period of data available.
Infosys Ltd, India's second largest IT services company, has no PERM cases since 2022.
According to the US government's PERM disclosure data for FY 2025, Wipro, TCS and HCLTech received 523, 513 and 393 permanent residence approvals, respectively, during this period.
This number is a small part of the approvals that non-IT companies received. Microsoft was the largest company to file PERM applications in the country in FY 2025. It adjudicated 3,161 cases, more than double the combined figure of the six outsourcing companies.
"I don't anticipate any immediate crisis. PERM is not the same as H-1B or other work visas. Therefore, suspending the green card process does not suddenly take away the ability of existing workers to work," Phil First, CEO of HFS Research, told The Mint.
First added, "If this suspension continues over the medium term, the risks will increase significantly. These companies rely on experienced regional experts, technology professionals, and employees who work directly with customers in the United States. The uncertainty over permanent residence could drive away the very employees companies want to retain most."
