More tech work move to Sri Lanka and India if US visas restricted: Virtusa
ECONOMYNEXT – VirtusaPolaris, a US-heaquartered information technology firm with development hubs in Sri Lanka and India, says more work will shift out of America if planned visa restrictions become law.
"Demand for technology services in the US cannot be fulfilled by the labour and industries within the United States," Virtusa Chairman Kris Canekeratne told reporters in Colombo. "The US has to look at access to talented technology professionals globally."
"If some of the legislation like visa regulations were enacted, we believe the work still has to happen and that will result in more work potentially being done outside the shores of the United States as opposed to inside the US."
Virtusa, following its acquisition of Chennai-based IT firm Polaris, has a head count of about 18,500 people, of which about 16,000 may be working directly in technology engineering.
About 25 percent of the staff work onsite, Canekeratne said, with the US bringing about 60 percent of the firm’s business. Of that, typically about half move in and out of the countries they work in.
If visas are restricted, more work will have to be done abroad to keep costs down, Canekeratne said.
Virtusa says quarter on quarter revenues grew 4.2 percent to $217 million, and expects to end the year with revenues of about $850 million, while some of its competitors in consulting and IT services are seeing flat revenues.
The firm has about 3,500 people working in Sri Lanka and may hire about a 500 more people.
Canekeratne said, in the past, protectionist proposals in the US have become diluted by the time they became law.
The ‘Silicon Valley’ tech industry has in general opposed Trump’s protectionism.
US firms are innovative and are quick to satisfy customers in the style of true capitalists, allowing them to lead the change and gain customers worldwide.
Their constant search for innovation and cost savings gave birth to the outsourced, IT-enabled services industry.
In the US, the government stays out of business, allowing them to innovate and disrupt industries, but provides rule of law, property rights and minimum regulation.
Many US firms in technology and other manufacturing have protested protectionist moves planned by the Trump administration. A recent ban on visitors from several Muslim majority countries have been suspended by courts.
US naturalisation laws, as well as strong property rights, have also made many who founded technology and other companies move to the US and make it their home.
But current US President Donald Trump was elected on a protectionist platform that critics say is part of an overall extreme nationalist ideology based on white supremacy, which some have pointed out have many features similar to Nazism. (Colombo/Feb13/2017)