Major Indian tech shares took a nosedive on Tuesday on reports that Trump is planning to make changes to the H-1B visa program that allows skilled foreigners to work in the US.
Shares in Tata Consultancy Services (TCS), India's biggest private sector employer, plunged more than 5% on Mumbai's stock exchange, while other top firms like Infosys (INFY) and Wipro (WIT) fell by more than 4%.
TCS and Wipro declined to comment. Infosys did not respond to requests for comment, CNN reported.
India's vast outsourcing industry employs millions of people. Its business in the US, where it provides engineering and other tech services to firms such as IBM (IBM, Tech30), Microsoft (MSFT, Tech30) and Citibank (C), is highly dependent on the H-1B visa.
The former US ambassador to India, Richard Verma, estimated last year that 70% of the 85,000 H-1B visas issued annually go to Indian workers. The visas, which are currently allocated by a lottery system, are hugely oversubscribed -- demand for them in 2016 was three times more than the number available.
Now, that system is under attack on multiple fronts. Three separate bills have been introduced in the US Congress this month aiming to curb the program in various ways.
It is also in Trump's crosshairs. A draft executive order obtained by CNN calls for several changes to US immigration rules, although it was not immediately clear what the specific impact on the H-1B visas would be.
"I think with respect to H-1Bs and other visas, it's part of a larger immigration reform effort that the president will continue to talk about," Trump's press secretary Sean Spicer told reporters on Monday.
Spicer added that Trump will do so "through executive order and through working with Congress."
Silicon Valley lawmaker Zoe Lofgren introduced a bill a week ago that calls for removing the lottery system and replacing it with a preference for companies that can pay the highest salaries.
The Indian government says it has made its view known to Trump and US lawmakers.
"India's interests and concerns have been conveyed both to the US Administration and the US Congress at senior levels," foreign ministry spokesman Vikas Swarup said Tuesday.