‘Proposed US visa curbs violate trade rules’

India will contest the new curbs on non-immigrant visas being considered by the US if they are implemented as they violate multilateral trade rules more blatantly than the earlier decision to sharply increase visa fees for professionals, a government official said.

“The new Bill completely disregards the General Agreement on Trade in Services as it talks about prohibiting companies from hiring on H1B and L1 visas. GATS does not allow such restrictions,” an official told BusinessLine .

At the World Trade Organization (WTO), New Delhi has already challenged the US decision to impose higher visa fees for workers hired on H1B and L1 visas by Indian IT firms that employ a considerable number of non-Americans.

“Since we have already challenged the US decision to impose higher visa fees, it will not be difficult to challenge the new proposal as both basically are targeted against our IT industry,” the official said.

However, India will first try to sort out the issue bilaterally, with the US Trade Representative’s office. “The Commerce Ministry is studying the proposed legislation and discussing it with lawyers. The issue will be taken up with the US at the highest level and New Delhi will ask Washington to drop the proposal as it is not compliant with global trade laws,” the official said.

The H1B and L1 Visa Reform Act of 2016 that was introduced by Democratic Congressman Bill Pascrell from New Jersey and Republican Dana Rohrabacher from California in the US House of Representatives last week seeks to prohibit companies from hiring H1B employees if they employ more than 50 people, and more than 50 per cent of the employees are H1B and L1 visa holders.The new legislation, if implemented, would affect the US operations of Indian IT companies such as Infosys and Wipro, which employ a high number of Indian IT professionals. For the proposal to get implemented, the US Senate will have to pass the Bill and it has to be signed into law by the US President.

Indian IT companies are already under financial pressure with Washington’s decision in December last year to not just reintroduce the border security cess on H1-B and L1 visa fees, which lapsed in September, but to double it to $4,000 and $4,500 for H1B and L1 visas, respectively.

While the US accounts for close to 60 per cent of software exports from India, the government here argues that Indian IT professionals have had a positive role in contributing to the competitiveness of the US economy.

According to estimates made by IT body Nasscom, Indian IT firms support over 400,000 jobs through their US operations and also paid over $20 billion in taxes to the US Treasury between 2011 and 2015.