UK new visa rules: Calm down folks, Indian IT firms won’t be affected

The recent change in UK visa rules announced today which created a panic among Indian IT professionals might not have a significant impact, according to experts in the industry.

“India’s IT professionals are paid more than the current basic that the UK stipulates,” said Kris Lakshmikanth, Chairman & Managing Director at The Head Hunters India; and ‎visiting faculty, Institute of Management, Ranchi.

"Who pays such low salaries, anyways. I don't think any Indian IT firm does," said Lakshmikanth.

Under the new visa rules announced by the UK Home Office, anyone applying after November 24 under the Tier 2 intra-company transfer (ICT) category would be required to meet a higher salary threshold requirement of 30,000 pounds from the earlier limit of 20,800 pounds.



The ICT route is largely used by Indian IT companies in Britain and the UK's Migration Advisory Committee (MAC) had found earlier this year that Indian IT workers accounted for nearly 90 per cent of visas issued under this route.

The changes come just days before British Prime Minister Theresa May lands in India on Sunday for her three-day visit.

"The first of two phases of changes to Tier 2, announced by the government in March following a review by the Independent Migration Advisory Committee, will affect applications made on or after November 24 unless stated otherwise," a UK Home Office statement said.

The Tier 2 ICT category rules apply to most Indian firms. Besides this, the rules also refer to a immigration health surcharge. The quantum of the surcharge will be announced in due course and will be applicable to all Indian IT firms when they make visa applications to the UK.

Lakshmikanth said that the average annual salaries of IT professionals in sales in Indian firms who are sent to the UK would be in the range of 50,000 to 60,000 pounds, and in addition they would get 50 to 60 percent commission. “The current raised income slabs by the UK government won’t affect IT workers from India, “ said Lakshmikanth.

Ramesh Loganathan, former President (Hyderabad Software Enterprise Association HYSEA) and Managing Director, Progress Software and a mentor for startups says that the salaries paid two decades ago for Indian IT professionals were more than what the UK government had prescribed as the basic earlier --  20,800 pounds. “As a market, the UK is large. However, the whole of Europe is comparable to the US where Indian IT has a sizeable presence,’ said Loganathan.

The UK may not be a sizeable market for India compared to the US but what this statement from the UK indicates is not very `inviting’ for the Indian IT industry, said Sanchit Gogia Chief Analyst & CEO of Greyhound Research, an independent IT and telecom research and advisory firm. He said that the change in rules indicates a `sense of protectionism’ on the part of the UK government. “The salaries mentioned are not prohibitive by the Indian IT standards and so that will not be an issue,” said Gogia.

ThoughtWorks India, a global technology consultancy firm, also echoes the same feeling that the raised salary slab will not affect India's IT industry who sends its employees to the UK. Dilkash Tasneem, head, global mobility and immigration, ThoughtWorks India said the increase in salaries as mentioned by changed UK visa rules will not affect the company as the salaries they pay to their employees in the UK is beyond the threshold announced by that government. “The Tier 2 ICT  will now have to pay the health surcharge, but this too only applies to short-term visas which are for a year and not for the long-term visas that are for a three year period,” said Tasneem.

The change in visa rules will help sharpen the Indian IT industry, believe some. Loganathan said that he welcomed the new announcement from the UK with regard to visa fees as it only helps sharpens Indian companies to innovate and come out with new business models. “The number of US visa applications haven’t gone up, but the industry revenues have tripled. This is because the business models have been innovative. So, similar sharp business will come forth on account of the revised UK visa rules," he said.

Meanwhile, reacting to the news, the industry body  Nasscom today expressed disappointment at the decision of the UK government to implement proposed changes to the UK visa system which it believes will affect skilled IT migration.

"Nasscom does recognise that these are changes the UK government has been committed to for some months, and their implementation is not a huge surprise. However, it is important to note that our fast growing and high value tech sectors rely upon an effective immigration policy that attracts high-skilled workers and minimises barriers to the flow of talented people between our two countries," the industry lobby said in a release.

"Indian IT companies play a key role in driving the UK’s growth and prosperity by significantly enhancing productivity and global competiveness of British businesses, contributing to overall growth and job creation of the UK economy," it said.


Updated Date: Nov 04, 2016 22:07 PM

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