When Donald Trump sneezes, the Indian IT industry often catches a cold. His latest wheeze—a $100,000 annual fee for H-1B visas—may sound like a punishment aimed at India, but in reality, it could be the best wake-up call for New Delhi. And if there’s one voice we ought to heed in this moment, it is that of industry veteran Mohandas Pai, who has been blunt in his prescription: invest heavily in India’s own IT ecosystem, from R&D to next-gen skills, or watch our brightest techies continue dreaming of Silicon Valley while the nation pays the price. Trump’s tantrums are hardly new. Peeved over India’s defiance—be it “Operation Sindoor” or refusing to let him take credit for diffusing tensions with Pakistan—he has already slapped tariffs left, right, and centre. Now, with the H-1B fee hike, he wants to permanently slam the door on Indian tech talent. But perhaps he has done us an inadvertent favour: forcing us to confront our addiction to exporting brains instead of nurturing them. Let’s start with the numbers. India’s IT sector already contributes 7.5% to GDP, with projections to hit 10% by FY25. Exports could cross $224 billion this fiscal, and $300 billion by FY26, according to NASSCOM. With 76 crore Indians now online, the domestic market itself is primed for a digital boom. Yet, despite this promise, the industry bleeds talent, struggles with wage inflation, and underinvests in R&D. The irony? We produce the engineers who drive innovation in Google, Microsoft, and Meta—but back home, we are content with being back-office coders. Pai is right to demand a reset. India cannot continue celebrating the “Infosys boys made good” story while ignoring that our education system produces graduates of whom only 51% are employable for core tech functions. Cloud computing alone requires nearly four million professionals, but we barely have 1.5 million trained. Cybersecurity has a talent deficit of 700,000. These are not just gaps—they are gaping holes in a sector we claim as our crown jewel.
Meanwhile, the costs mount. Employee expenses have risen 206% over the past decade, outpacing revenue growth. Attrition rates remain stubbornly high, forcing firms to depend on expensive lateral hires. Add compliance burdens—from India’s data protection laws to the EU’s GDPR—and margins keep getting squeezed. The government’s initiatives—Software Technology Parks, 100% FDI, and the National Policy on Software Products—are good, but piecemeal. What India needs is not tinkering at the edges but a bold, coordinated push that mirrors what China did with hardware or Israel with cybersecurity. The opportunity is staring us in the face. The future is not in legacy outsourcing but in AI, cloud, SaaS, cybersecurity, and data centres. Already, global hyperscalers like AWS and Microsoft are betting big on India’s digital expansion. Our own SaaS startups—from Kissflow to Neysa—are proving that product-first models can thrive here. Data centre capacity could quadruple by 2030, drawing billions in investment. If the Modi government can provide the capital, the infrastructure, and the policy support, the private sector will do the rest. Most importantly, investing at home addresses the brain-drain problem at its root. Why should a young engineer from Bengaluru feel her future lies only in California when she could build world-class products from India? Why should we celebrate when Sundar Pichai becomes Google CEO, instead of asking why he had to leave India in the first place? Trump’s $100,000 fee may keep our talent out of the U.S., but unless we create opportunities here, they will simply migrate to Europe, Australia, or Canada. India has the brains. It now needs the vision. Pai has thrown the gauntlet: invest big in R&D, overhaul curricula, incentivize product innovation, and give young techies a reason to stay. Trump’s door is closing, but perhaps that is the push we needed to finally open our own.
