Indian Tech Companies Get Jittery About Trump's New Visa Cuts Plan

Indian IT stocks declined sharply after a new Bill was tabled at the US House of Representatives

Indian Tech Companies Get Jittery About Trump's New Visa Cuts Plan

New Delhi- India on Tuesday said it has expressed its concern to the USA over a bill to change rules on H-1B visas that will impact the IT industry and Indian techies working in America.

The Ministry of External Affairs said on Tuesday that India had been in touch with the US on the visa law, indicating that the outreach had evoked little impact.

President Donald trump is planning an executive order to overhaul the work-visa programs - including H-1B visas - which are used by tech companies across the country to hire employees, Bloomberg reports. According to the associate consultant we spoke to, these minimum wages depend on the parts of the U.S. you are working in. This would mean that the tech companies which hire foreign nationals at lower salaries, including a huge number from India, will prefer American nationals thereby creating jobs for USA citizens.

These and other technology companies say they depend on the H-1B visa program and others like it to bring in qualified talent for jobs that would otherwise go unfilled.

It is noteworthy, the visa sponsors, who are employers, are sorted by the number of Labor Condition Application (LCA) submitted.

IT analysts reckon that the new law, if and when it passes, will have far-reaching implications not only on Indian companies but on the USA economy as well since most US-based Fortune 500 organisations are "deeply invested and dependent" on Indian IT services providers.

According to ComputerWorld magazine, almost 86 per cent of H1-B visas for computer-related jobs and 46.5 per cent for engineering positions were given to Indians.

Others, such as Indian economist Sonal Varma of Nomura, have indicated the potential harm that further limits on H-1B visas could have on both the USA and Indian economy. Last summer, Assistant Secretary of State for Consular Affairs Michele Bond told India's Zee News that "Indian citizens receive nearly 70 percent of all H-1 B visas issued worldwide". The industry lobby also said that the bill could have loopholes that would nullify the objective of saving American jobs.

"More than 50% of their revenues come from that market".

According to ICRA, Indian Information Technology (IT) services exports for the fiscal year 2015-16 (FY16) stood at $110 billion whereby it grew at 10 year CAGR of 16%.

Other reforms that have been put forward include a proposal last week from Rep. Zoe Lofgren, a Democrat, who is the congresswoman from the district that includes San Jose, which seeks to curtail what she describes as "outsourcing abuse" of the program by adding in higher salary requirements to make the program more competitive.

The Indian government says it has made its view known to Trump and USA lawmakers. The IT lobbying group said that India's IT sector has helped American businesses by providing high-skilled IT solutions in order to innovate, open new markets, and expand operations - creating thousands of jobs for Americans.

STEM is an acronym for Science, Technology, Engineering and Mathematics.

As the government of the United States of America (USA) tries to bring in stringent visa regulation through the H1B visa reform bill, there is increasing confusion among students aspiring for higher education in USA. I am sure they will meet very soon.

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