Will Indians Drop Out of US Universities to Avoid More Debt

Students from India will be hardest hit by $100,000 fee for US H-1B temporary work visas

September 20, 2025

Students from India in the United States face a harsh new financial reality. Starting tomorrow, upon graduation, their chances of getting a temporary professional work visa for foreigners with special skills, known as H-1B visas, will be reduced to near zero.

This is because a company hiring a foreigner on an H-1B visa will have to make a “payment of $100,000” to the US government, according to an Executive Order issued by President Donald Trump. The order applies to 85,000 new H-1B visas issued each year. Those on existing H-1B visas, which last a total of six years, are exempt from the fees.

Each year, since 2010, a majority of H-1B visas were issued to workers born in India, according to a study by the Pew Research Center. In fiscal 2023, Indians accounted for roughly three-quarters of workers approved for the visas. Those born in China accounted for 12%, while no other birthplace accounted for even 2%.

Given rising number of students from India, and the fixed number of work visas, the chances of a student from India finding work on the visa was very low: one in 15, as pointed out in a Global Indian Times story. This low prospect was for a science, technology, engineering and math (STEM) graduate with a US Master’s or PhD degree. The US job prospects were far lower for Indians earning an undergraduate, advanced social science, and MBA degrees in the US.

In 2024, there were 422,335 students from India in the United States, according to a US government report. Most of them are pursuing advanced degrees. The vast majority fund the $200,000, required for fees, boarding, and other expenses for a two-year MS degree, by borrowing money. They secure loans from banks in India, at annual interest rates of over 8%, by putting up their apartments and homes as collateral. Some parents, especially those who do not have adequate collateral, sell their jewelry and borrow from relatives and friends to fund their children’s US education. The assumption was that, upon graduation, the students would find well-paying jobs in the US, on practical training visas and work visas, which will help them to repay the loans.

Up until today, companies in the U.S. appear to have managed the size of their engineering and other technical workforce largely by combining the supply of foreign, mainly Indian, graduates of U.S. universities and the hiring flexibility provided by H-1B visas,

This swing skilled labor capacity provided by foreigners was evident from hiring and lay off data. In 2022, for instance, the top 30 H-1B employers hired more than 34,000 new H-1B workers, according to a report by the Economic Policy Institute. In 2022, and the first quarter of 2023, the top 30 H-1B employers also laid off at least 85,000 employees on H-1B visas.

While the visa system enabled companies to hire skilled foreigners on a temporary basis, some students from India found work and were thus able to repay their education debt. The level of debt repaid depended on the length of their employment on the visa. But this potential option, of finding work to repay education debt, no longer exists for Indian and other foreign students.

(Image: Courtesy Wikimedia Commons.)

The goal of the $100,000 fee, the Trump Administration says, is to halt the “abuse of the H-1B visa.” The number of foreign STEM workers in the US “has more than doubled between 2000 and 2019, increasing from 1.2 million to almost 2.5 million, while overall STEM employment has only increased 44.5 percent during that time,” according to Trump’s executive order. “Among computer and math occupations, the foreign share of the workforce grew from 17.7 percent in 2000 to 26.1 percent in 2019. And the key facilitator for this influx of foreign STEM labor has been” the H-1B visa.

This year, the top employers securing H-1B visas were mainly the major American technology companies: Amazon, with 10,000; Microsoft, 5200; Meta Platforms, parent of Facebook, 5100; Apple, and Google 4,200 each; also JP Morgan Chase, Walmart, and Deloitte, with roughly 2,400 each.

There were some outsourcing firms among the top ten H-1B visa beneficiaries, including India’s Tata Consultancy Services, with 5,500 visas, and Cognizant Technologies, 2,500. Infosys, Wipro and the other Indian outsourcing companies were also big users of H-1B visas.

In 2023, the median annual wage of a foreigner working on an H-1B visa was $118,000. In addition to such salaries, few companies will pay $100,000 in H-1B fees to hire a foreign graduate from even a top US university. This is because the fee sharply boosts the labor costs of the companies.

If Amazon were to hire 10,000 new H-1B employees in 2026, it would incur an additional $1 billion in cost to pay the fees. The financial hit will be even bigger for the relatively smaller companies, including the Indian outsourcing companies. Assuming it hired 5,500 on H-1 B visas in 2026, Tata Consultancy, for instance, would have to pay $550 million in fees. This would slash its operating profit by at least 8%; its total operating income in fiscal year 2025 was $7.2 billion on $30 billion in revenues.

In the past, healthcare systems and universities have hired foreign STEM graduates. Given budget cuts, they are unlikely to pay $100,000 in fees to hire foreign graduates on H-1B visas. At best, some of the major technology companies will pay the fee to hire a few PhDs from the top universities in artificial intelligence, robotics, computer science, data science and bio-technology. Overall, the chances of a student from India finding work on a H-1B visa is now close to zero, down from the previous one in 15.

Some US immigration lawyers say that the $100,000 H-1B visa fee will be ruled invalid by the courts. This has raised hopes of finding work visas among some students from India. But, so far, the Trump Administration’s immigration policies have been largely upheld by the US Supreme Court.

Some university officials believe that students will be hired on practical training (OPT) visas upon graduation. This too has raised hopes of finding work in the US among students from India. But the chances of securing an OPT visa was one in three, even for Indians with STEM degrees. This is estimated from data from fiscal year 2023 when there were 69,000 Indians working on OPT visas. More important, it is likely that the Trump Administration will restrict issuance of practical training visas, perhaps by mandating a large fee.

In July, before the start of this academic year, there were clear signs that students from India should avoid enrolling at US universities. This was because the Trump administration was hinting at restricting the issuance of H-1B professional work visas. "I don't want companies to fire 9,000 American workers and then to go and say, ‘We can't find workers here in America.’ That’s a bulls--- story," U.S. Vice President JD Vance said at Winning the AI Race, an AI Summit in Washington DC. The Vice President questioned why some U.S. technology firms claim they need "overseas visa programs to find workers," when "the college-educated employment rate for STEM graduates in this country seems to be declining."

Earlier this month, the new academic year just began at US universities. Typically, students pay fees per semester, prior to the start of a semester. Before the next semester’s fees are due, it likely makes sense for almost all indebted students from India to return home and avoid incurring additional debt to pursue an US education.