On Thursday, Vance said the Trump administration wants both foreign and U.S. companies to "employ American workers," adding that firms "cannot lay off American workers and then replace them with foreign indentured servants." He spoke as the Labor Department moved to freeze Microsoft, Adobe, and several large Indian information technology companies out of the Permanent Labor Certification program, which is the process employers use to sponsor permanent residency for H-1B employees. Vance also alleged that Microsoft replaced 6,000 laid-off employees with H-1B visa holders. CNBC sought comment from his office, which did not respond right away.
Diplomatic friction reaches trade negotiations faster than it reaches treaties. Market Briefs covers that link free every weekday.
India's Ministry of External Affairs said Friday that Vance used "terminology that carries painful historical and colonial legacy connotations" and called the remarks "deeply offensive." The ministry added, "Such descriptions are unwarranted and ignore the fact that Indian professionals in the United States are highly educated and skilled contributors to its economy and innovation ecosystem." It also informed citizens that the measures announced by the U.S. will leave current H-1B visas unaffected and will not change the status of H-1B holders or their dependents. "Talent mobility adds value to both economies," the statement noted, and it further said the suspensions "do not advance the shared ambitions of both countries."
The Indian companies named by the U.S. include Cognizant, Infosys, Capgemini, Tata Consultancy Services, Wipro and HCL. Industry body NASSCOM said Indian tech firms have "significantly reduced their dependence on H-1B visas" in recent years and are growing U.S. hiring. Tata Consultancy Services stated that its H-1B applications were in "single digits" over the past two years and that it intends to add 15,000 more employees in the U.S. during the next five years.
India accounted for about seven in ten H-1B beneficiaries in 2025, so the announced halt in PERM filings for the listed companies could complicate staffing for certain roles, even as existing H-1B visas remain valid. Cost pressures may also shift after a federal judge in June blocked the $100,000 H-1B visa fee President Donald Trump imposed last year. If you work in or invest around tech-enabled services, keep an eye on how companies rebalance recruiting and onshore headcount. Changes to who can stay and where teams sit can filter into delivery timelines, margins and, eventually, earnings.
Tariff talks and public remarks are rarely as separate as they look. Join Market Briefs free and follow it.
