Wall Street Speeds Up India Expansion

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If you see the job openings, it's for a senior role, a software engineering role in high level.

Yeah.

If you scroll below, there is something related to audits this technology.

Earlier this week, I went job hunting on LinkedIn with side Nayak, Bloomberg finance reporter based in Mumbai.

You can also experiment with other firms like say a Goldman Sachs. Goldman Sachs has an opening in Hyderabad for Corporate Planning and Management Vice President Software Engineering in Hyderabad.

Now, I am not planning a career pivot or a move from New York to New Delhi. We did this so CIDI could show me that jobs in India's finance sector are not what they used to be. City covers the big Wall Street banks, JP, Morgan, Chase, Morgan, Stanley, Goldman Sachs. For years, much of the coverage of the global banking industry and its white collar employees was focused on the US and Europe. But City and I weren't

Wall Street banks don't have a big presence from the retail site. But if you look at the corporate side as well as the investment banking side and the wealth side, basically they have a huge presence. This is your JP Morgan, your Barclays, your HSBC, your Deutsche Bank.

City is on a team of Bloomberg reporters tracking Wall Street's growing reliance on Indian hubs. This is a shift that's accelerated as President Trump Titan's visa requirements and as India's booming wealth management industry and private credit continue to grow.

JP Morgan Chase is hiring credit specialists in Mangalore. Goldman Sachs is hiring analysts to review loans tight to everything from commercial property to yachts. So what began as low skilled, call centered jobs in India have now evolved into a mission critical hub of global finance and technology.

This is the Big Take Asia from Bloomberg News. I'm David Gura in for Wanha. Every week we take you inside some of the world's biggest and most powerful economies and the markets, tycoons and businesses that drive this ever shifting region. Today on the show, Indian based workers once supported American financial services firms now they're increasingly key to their operations. How India's government is encouraging Wall Street firms to expand their footprint in India, and how President Trump's

These firms operations in India were largely to address grievances of customers or initiate sales through phone calls. So, for example, if you're a client based in US and had grievances related to insurance, the chances were that Indians had these call centers would answer these calls and help address these concerns.

But that has changed dramatically over the last decade. Take Goldman Sacks as an example. In two thousand and four, its office in the southern city of Bangalore had three hundred employees, most of whom focused on tech and IT support. Today that same office is home to more than eight thousand employees. Those workers do everything from core financial analysis to risk management, the kind of jobs that used to be done in US cities.

The perception that Indian gccs are providing call center jobs is kind of changing. Gccs that are now offshow centers established by these multinational cooperations or financial services firms now deliver high quality, cost effective services and support their global operations. Call center jobs are now being outsourced to other emerging economies like Philippines. Property prices also are cheap because the value of rupee is depreciating visa either dollar.

So it sounds like there is quite a boom here. How far along are we?

Financial services firms? Banks have a significant employee base in India. The top six US banks in India, that is JP, Morgan, Bank of America, Goldman, Sachs City, etc. Employ about one fifty thousand people in India. We know that Goldman, SAX and Morgan Stanley have more staff in India than anywhere

Is this going to be a bigger magnet? Do you think in the years ahead it.

Is going to be a bigger magnet.

Because most of these colleges as well as tech centers are churning out low cost talent on a large scale, there will be more opportunities for formal and informal workers. This is because there is no dearth of talent from the tech side in India. There's always a lot of graduates every year that get pulled up into these roles, which is why we can see the boom expecting to continue and most of these firms trying to leverage on the talent that is built in India.

According to estimates from the National Association of Software and Service Companies and consulting firm Zenov, employment at gccs in India is projected to jump fifty percent to as many as two point eight million people by twenty thirty. Cdesa's employees at these gccs are breaking ground too. A source told Bloomberg that Black Rocks a Laddin portfolio management platform was developed in India, as was Goldman's Atlas trading system.

We have information from our sources that the technology behind running this zell app was entirely built out of India through Bank of America, Goldman Sachs gccs in Bangalore and Hyderabad. This was kind of inspired by the fintech revolution in India. We have a UPI Unified Payment Interface system in India where there is a bank to bank transfer of payment systems using a QR code. So most of these inspirations were kind of instrumental in making or building the Zell app.

Could you situate this in kind of the broader Indian economy? How important it is that the growth of these gccs the importance of Wall Street's interest in putting some of these higher skill jobs in India.

So gccs are a vital component of the Wall Street firm's global strategies as well as for India's economic growth. They are fostering job creation, skill development, and foreign investment in India that is in turn getting fed into India's GDP growth. Their revenue is expected to search to one hundred and five billion dollars from about forty point four billion dollars in FY nineteen, according to na Scom and Zenov estimates. So this is the kind of impact that

This year, US immigration policy through a ranch in India's workforce overseas, but it also became a boon for their domestic gccs. How that's after the break In late September, President Trump announced it change to US immigration policy with a big price tag, a one hundred thousand dollars fee for an H one B visa application.

The country would rather not have to pay one hundred thousand dollars, but rather, how do you do that? You hire America, So there's an incentive to hire.

The H one B is a non immigrant visa which allows US employers to temporarily hire foreign workers in highly skilled roles engineering, technology, medicine. When Trump made the announcement, the US's financial sector found itself relatively unprepared, as Bloomberg City nayak So.

Indians make up roughly seventy percent of H one B holders. When Trump first announced one hundred thousand dollar visa fee, it was seen as a big blow for Indians.

We had JP Morgan.

CEO Jamie Dimmons say that the announcement caught everybody off guard. Apart from that, we had HSBC stating that the new one hundred thousand, h one B dollar fee in the US was manageable due to their relatively low number of foreign workers compared to other firms.

JP Morgan, APAX CEO and head of Banking Short Leanard joined Bloomberg TV's Menkadoshe shortly after Trump's announcement and expanded on the company's disappointment that how this would impact India's younger workforce.

So, will JP Morgan be moving more jobs to your GCC here.

Yeah, well that's a very good question, and if it was, it would be a shame because it obviously has been a great source of opportunity for Indian students. You know, India producer's two point eight million STEM students every year and they've gone all over the world, including.

In a statement to Bloomberg. A White House spokeswoman said changes to the H one B visa program were necessary to put America first. She said the bank's efforts to move jobs overseas is quote evidence that they were using foreign workers to undercut Americans wages. Though it is a change, it's not like the rug had gotten pulled down from under India's financial industry City says the Indian economy was expanding and the upper class was growing in this.

In the middle of a wealth broom.

The boom had already started post COVID, and Trump's announcement of the visa fee kind of gotten in for these firms, like an incentive to hire more talent inward. Banks that might consider transferring a worker to the US may now be opened to hire them in India itself.

An H one B visa used to cost on average, around five thousand dollars. JP Morgan is among the top ten companies in the US that sponsors the most H one B visas. City says the new visa fee has sparked some chatter among the banks.

Some of the Wall Street banks in India were looking to talk to their counterparts in the US to talk to them about opening more roles in India specialist roles in India to kind of not be impacted by the higher he B dollar fee.

Then there's the math involved in hiring people in India versus in a US city.

Firms know that the salary of an Indian tech engineer is much less than what it is in the US for an entry level role at a US bank's GCC, and engineering graduate in India could earn anything between say three hundred thousand rupees to eight hundred thousand rupees a year depending on the location.

That's between four and ten thousand dollars per employee.

That compass with a sixty thousand dollars annual fee for an Indian on a US visa and up to one twenty thousand dollars for a US citizen in the same role.

So he says, these calculations are driving banks to think differently about the way they balance staffing in their offices in the US and in India.

This has actually accelerated the pivot to India Wall Street banks for hiring anyway, this fee is just a push potentially bringing more jobs to India. So recruitment firms have told us that with the new fee, workers have started to question if a US job is a priority for or most of the employees, as well as the employers. Firms have also realized that this is not going to be cost effective and India, which was already seeing a GCC boom, would now benefit from this.

Trump said the higher H ONEB VISA application fee is to address quote abuse of the program and to compel US companies to hire Americans, but cities reporting shows it could backfire and hurt the US instead.

Senior executives from at least two US banks in India are in talks to consider ways to ramp up their global capability centers in India. This is in response to the H ONEB VISA crackdown. According to sources, some global lenders that had extended offer letters for positions in the US are also looking to either revoke them or create alternative roles at these gccs.

That's bad news for the US job market potentially, but it could be great news for India.

If these jobs are coming to India, it is a boom for the job market. A tech engineer or a tech specialist who has just graduated has more options on the table. He has the option of getting into a startup a GCC of fintech firms. The role is being elevated in the sense that he has to do more jobs that involve research, legal development, specializing, getting into certain spaces that only high skill talent can tap into. That is the kind of opportunity boom in gccs has provided

So the says the government has seen an opportunity and is working on a set of policies to incentivize the financial sector designed to help the GCC ecosystem thrive.

India announces its federal budget on the first of February every year. This is kind of a broad layout that the government has on revenues, taxations, incentives, etc. From our sources, we have found out that there is a GCC policy framework that's going to be in the making so that more US firms or more foreign firms are encouraged and incentivized to build more GCC hubs here. These banks employ a huge workforce in India. Foreign firms bring in a

So they says, it'll be a while before we see how this pans out in India and in the US. As banks recalibrate their global hiring strategies. One thing banks are watching and something that's holding them back from expanding too aggressively is how Trump could retaliate.

So US firms are walking a fine line as then look to shift more of these roles to India. There is a risk that there could be a backlash from Trump and Trump could.

Now target GCC's next.

It could bring GCC's in Trump's crosshairs. When we spoke to our sources, we found that these banks were considering Trump's imposition of tariffs or sanctions on GCC sees as a major risk to their operations. They said that most of these banks and their US headquarters were talking to Trump about the issues and the fact that they were hiring a lot of people in India, so any impact of the government's orders would directly be felt on these.

Banks operations as well.

But that is a story for another day.

This is The Big Take Asia from Bloomberg News. I'm David Gera. To get more from The Big Take and unlimited access to all of Bloomberg dot com, subscribe today at Bloomberg dot com slash podcast Offer. If you liked the episode, make sure to subscribe and review The Big Take Asia wherever you listen to podcasts. It helps people find the show. Thanks for listening, See you next time.