US President, Donald Trump has issued a proclamation banning various non-immigrant visas including the H-1B, most sought after by the Indian tech professionals, till this year-end. The move will impact nearly 85,000 workers who were issued H-1B visas this year out of 2,25,000 applicants. Trump has also sought to “reform” the current immigration system to prioritise the employment of local Americans as well as make it more “merit-based”. A White House spokesperson said that the measure would help reserve 5,25,000 jobs for Americans.
Under the new system, the administration would allow the highly skilled and highest-paid workers to avail H1-B visas first and enter the US in place of the lottery system. Monday’s proclamation issued by Trump said that the unemployment rate in US has increased by four times between February-May, 2020. It added that the entry of additional workers through various non-immigration visa programmes like H-1B, H-2B, J and L presents a threat to the employment opportunities for Americans affected by extraordinary economic disruptions caused by COVID-19 outbreak.
Meanwhile, major stakeholders in the US tech industry have opposed Trump’s move which will hurt the country’s economy in the long term by reducing the market competitiveness. Google CEO, Sundar Pichai said that he is disappointed by today’s proclamation and that they will continue to stand with immigrants and work to expand opportunity for all.
“Immigration has contributed immensely to America’s economic success, making it a global leader in tech, and also Google the company it is today,” Pichai said.
How will the ban affect Indian IT industry?
With three out of every four H-1B visa holders Indians, the ban will surely impact the prospects of the H-1B visa applicants from top Indian IT services firms including TCS, Wipro, Infosys, Cognizant. Nearly 3-4 lakh H-1B visa holders are currently being employed by top tech firms in India and more than 60% of engineers in the Bay area are H-1B visa holders.
With Trump supporting stricter immigrant, non-immigrant visa regimes, the Indian IT firms have reduced their applications for H1-B visas considerably since last couple of years with efforts to hire more locals in the US. An annual report of India’s largest IT services provider, TCS said that it has nearly 20,000 US nationals on its payroll.
However, industry analysts fear that a long term ban of H-1B visas which recruit workers for specialist positions in fields such as IT, science will hurt the project deliverability of Indian IT services firms because of shortage in the talent.