H-1B visa: 'Serious action' by US will severely hit Indian exports, says CEA

Washington/New Delhi: Chief Economic Adviser Arvind Subramanian has said that ‘serious actions’ by the Donald Trump government against the H-1B visa programme could worry India, as a majority of Indian exports in the service sector go to the US.

According to a report in NDTV, speaking at the Peterson Institute, a top economic think tank in Washington, Subramanian said 40 to 45 per cent of India’s exports are service exports, and 50 to 60 per cent of these go to the US.

India is keeping a close watch on the US visa reforms and the government will be "okay" as long as the visa reforms are manageable, Subramanian said according to the report.

The US has accused top Indian IT firms TCS and Infosys of unfairly cornering the lion's share of H-1B visas by putting extra tickets in the lottery system. 

At a White House briefing last week, an official in the Trump administration said a small number of giant outsourcing firms flood the system with applications which naturally ups their chances of success in the lottery draw.

"You may know their names well, but like the top recipients of the H-1B visa are companies like Tata, Infosys, Cognizant -- they will apply for a very large number of visas, more than they get, by putting extra tickets in the lottery raffle, if you will, and then they'll get the lion's share of visas," the senior official said, according to transcript of the briefing posted on White House website.

Responding to a follow up on why Indian companies were singled out for a mention, the White House response said Tata Consultancy Services, Infosys and Cognizant were the top three recipients of H-1B visas.

Finance Minister Arun Jaitley has already raised the issue of restrictions on H-1B visa twice with the US.

US President Donald Trump has signed an executive order for tightening the rules of the H-1B visa programme to stop its 'abuse' and ensure that the visas are given to the 'most-skilled or highest paid' petitioners.

The Indian IT industry has expressed serious concerns over this as these visas are mainly used by domestic IT professionals for short-term work in America.

The H-1B is a non-immigrant visa that allows US companies to employ foreign workers in speciality occupations that require theoretical or technical expertise in specialised fields. Indian technology companies depend on it to hire tens of thousands of employees each year for their US operations.

The US market accounts for about 60 per cent of the revenue of the Indian IT industry.

Reforming the H-1B visa system was one of the major election promises of Trump. As per several US reports, a majority of the H-1B visas every year are grabbed by Indian IT professionals.

India accounts for the highest pool of qualified IT professionals, whose services go a long way in making American companies globally competitive.