According to the estimations made by Nasscom, the decision to increase the visa fee for US would lead to increase in expenses for the IT firms in India. These estimations were based on the premise that the hike would be about $4,500 to the current fee which is $2500 on the H1 visas.
It has to be noted here that India uses of about 50,000 H1 and L1 visas annually. This fee is divided into filing fee and fraud fee. However, Nasscom has stated that it is not yet clear as to the hike of $2,250 applies to both the above categories or it is combined. In either of the ways, the effect would be significant.
It can also be said that this new bill has been brought about to make the Indian firms less competitive in comparison to its US counterparts such as those of Accenture, HP and IBM. As per the provisions in the bill, the fee is higher only for those firms which place fifty or more of their employees in the United States. More so, this would be applicable if more than half of the employees hold the status of an L-1 or H-1B visa.
However, when it comes to the US based firms, there are only a few employees holding the above status. At the same time, Indian firms have more than 50 percent of their employees holding this status and with most of them spreading their base with local employees.
The above clearly tells that the major part of the funds would be coming from the Indian IT firms where as the US firms using this visa would not be affected. The natural tendency to protect its south-west borders by the US is quite understood. But this would surely have a negative impact on the Indian companies. More so, this proposed hike can be considered as being against the free trade.
In addition to the above, these Indian firms along with the Indian nationals have to pay more than $1 billion as social security. Here, there is no guarantee of either a refund or any form of benefits that could be availed. Such benefits could only be availed if the concerned person has lived in the US for ten years. On the contrary, most of the IT professionals tend to reside in the US for a few months.
Above all, since the bill would raise the budgets of these companies, it can now be said that these firms would look into engaging more of local workers. At the same time, completely removing the presence of the Indian IT sector in the US is also not a viable option since this sector is very vital to the growth of the US economy.
