New H-1B visa rules to affect Indian techies & IT companies, MEA conveys concerns to US

New H-1B visa rules to affect Indian techies & IT companies, MEA conveys concerns to US
Representational Image. Courtesy: boursier.com

Amid the chaos and plummeting stock of IT companies, India conveyed its concerns to the US over a bill being introduced in the Congress to change rules on H-1B visas which is likely to impact its IT industry and Indian techies working in the US.

“India’s interests and concerns have been conveyed both to the US administration and the US Congress at senior levels,” External Affairs Ministry spokesperson Vikas Swarup said.

The High-Skilled Integrity and Fairness Act of 2017, introduced in House of Representatives by California Congresswoman Zoe Lofgren, calls for doubling the minimum salary of H-1B visa holders to $130,000 from the current minimum wage of $60,000.

If implemented, the bill could have a drastic impact on Indian techies as it would make their recruitment far less economically viable. It will also affect many American Fortune 500 companies that are dependent on Indian talent.

The bill, likely to be signed by President Donald Trump, would make it difficult for firms to use the programme to replace American employees with foreign workers, including from India, with lower wages.

Even as Trump was preparing to issue executive orders on H-1B, the draft of the order was leaked and published by some news outlets on Monday.

According to a copy of the leaked draft order, Trump could reverse his predecessor Barack Obama’s extension of the duration of the optional practical training work visas, which allowed foreign students to stay in the US a bit longer after completion of their studies.

The bill would require that employers first offer a vacant position to an equally or better qualified American worker before seeking an H-1B or L-1 visa holder.

It would also establish wage requirements for L-1 workers and improve H-1B wage requirements to encourage companies to hire qualified American workers and prevent them from using foreign workers as a source of cheap labour.

While many have termed the bill ‘disappointing’ in the Indian context, C.P. Gurnani, MD & CEO of Tech Mahindra, is hopeful that things will improve once Prime Minister Narendra Modi meets US President Donald Trump around mid-2017.

According to Gurnani, India-incorporated IT companies investments is close to $2 billion in the US and India incorporated IT companies are able to create about 100,000 jobs a year in America.

“Similarly we believe that we contribute to America with very high skilled work force because we are reacting to a demand-supply. The reality is that in science, technology, engineering and mathematics, the US needs that smart capital. So it’s a win-win for both India and America,” Gurnani said.

Following the draft leak, shares of major IT companies like Infosys, TCS, Wipro, HCL Technologies and Tech Mahindra fell by up to 5 percent on Mumbai’s stock exchange.

Richard Verma, former U.S. ambassador to India, estimates that out of the 85,000 H-1B visas issued annually, over 70 percent go to Indians.

With IANS inputs

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