H1-B visa: Premium processing halted, IT firms to take a hit

BENGALURU: Saturday morning arrived with more bad news for the Indian IT sector, with the United States Citizenship and Immigration Services (USCIS) announcing that it will stop all processing of premium H1-B visas filed on or later than April 3, 2017.

The move comes amid a slew of policy changes in immigration by the Donald Trump administration, whose presidential campaign had as a centrepiece the protection of jobs for US citizens. The past few weeks have seen many in the US, primarily Trump supporters, call for expediting the promised crackdown on H1-B visas.

According to the USCIS statement, the current suspension is temporary, but it might well last for up to six months. H1-B visas are the most popular category for skilled workers wanting to work in the US. ‘Premium’ processing of visas allows such applicants to jump the long queues by paying a fee of $1,225 (about `81,785).

The suspension is likely to have an impact on Indian IT firms, especially big ones that could afford to pay the fee to expedite approval of visas for their workers travelling from outside the US. These firms will find it harder to send in employees based outside the US on a short notice, impacting urgent project deliveries. Planning will now need to take at least three months in advance, the average time taken to process a normal H1-B visa application.

The USCIS issues around 85,000 H1-B visas every year and Indian technology companies are the single-largest recipients.

“This will have a very deep impact on the way things have been functioning till now…,” said Ashok Soota, executive chairman and co-founder of Happiest Minds Technologies.

“The suspension of processing for all H-1B visas is Trump’s gimmick as he wants to prove that he’s fulfilling his election promises. This is not good for Indian IT companies..,” said V K Mathews, founder chairman, IBS Software Services. However, he said that the primary reason why companies imported Indian specialists was due to economic advantages. “These reasons still prevail and I am sure that these restrictions will be lifted in the near future,” he added.

According to Shivendra Singh, vice-president and head of global trade development at Nasscom, the US will still need to import talent. “There is a challenge on the supply side. There is a skill gap in STEM (science, technology, engineering and maths). Indian companies are the ones helping them fill this gap.”