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America's action creates stir in Indian IT sector, Rs 55 thousand crores wiped out from big companies

Tezzbuzz Desk – There was a big fall in the shares of IT sector in the Indian stock market on Wednesday. Investors' concerns increased after the US administration suspended the PERM labor certification filing of IT giant Cognizant. Its direct impact was also seen on the shares of Indian IT companies and the market value of major companies of the sector decreased by about Rs 55 thousand crores. On Wednesday, maximum selling pressure was seen in IT shares. Infosys shares fell by more than 3 percent. Apart from this, shares of Tech Mahindra, HCL Technologies and Persistent Systems also fell by about 3 percent. Shares of TCS, Mphaseis, Wipro and LTIMindtree saw a decline of around 2 per cent.

The US Labor Department has suspended Cognizant's filing under the Permanent Labor Certification (PERM) program. The PERM process is important for companies that want to sponsor foreign workers for employment-based green cards. US Labor Department Inspector General Anthony D'Esposito informed about this action through social media. According to him, cases to possible loss to American employees and alleged fraud are being investigated. The White House Anti-Fraud Task Force is also involved in this investigation along with Labor Department officials.

However, US officials have not provided details about any specific allegations made against Cognizant, the number of applications affected or the duration of the suspension of PERM filings. The information released also did not mention any criminal charges against the company. The authorities have also suspended the PERM filings of Cognizant as well as Cloudera. At present, there has been no detailed reaction from both the companies on this action.

This action has taken place at a time when Cognizant had announced plans to increase its workforce in America. The company had said it would hire 1,500 American college graduates. Apart from this, the company is working on a plan to increase its Frontier Certified Engineer and Frontier Business Operator workforce to 15,000 employees. Company CEO Ravi Kumar S said that Cognizant is focusing on hiring American graduates, creating new job categories for the AI ​​​​era, and creating new opportunities for American workers. PERM certification is mainly to permanent jobs and the employment-based green card process. The H-1B visa allows qualified US employers to temporarily hire foreign professionals to perform specific types of jobs. Therefore, the stay on Cognizant's PERM filing does not directly mean that the company's H-1B petitions have also been put on hold.

Cognizant is headquartered in Teaneck, New Jersey and the company is listed on Nasdaq under the ticker CTSH. The company was established in 1994 in Chennai and has a large presence in India. At the same time, a decline of about 9 percent was also seen in the shares of Coforge, although this decline in the shares of the company was to a different development. After the audit, the news of resignation of the company's Chairman Om Prakash Bhatt was revealed. This action of America has once again raised concerns about American visa and immigration policies for Indian IT companies. Especially for companies that have a significant dependence on the US market and foreign employees.