India concerned over fate of IT companies in US

Some provisions in immigration reforms may hit Indian firms

India concerned over fate of IT companies in US

The US Comprehensive Immigration Reforms Bill and India’s policy to give preference to domestic telecom equipment manufacturers emerged as new irritants in the ties between New Delhi and Washington, even as they prepare for the annual strategic dialogue next month with a series of high-level visits.

New Delhi on Friday conveyed to Washington its concerns over certain provisions in the Comprehensive Immigration Reforms introduced in the US Senate last month by a bipartisan group of eight senators.

Foreign Secretary Ranjan Mathai told his US counterpart Deputy Secretary of State William Burns that certain provisions in the Bill might hit the Indian Information Technology companies doing business in America. Burns, on the other hand, is understood to have conveyed to Mathai the US companies’ concerns over the Indian government’s policy of giving Preferential Market Access to domestic telecom equipment manufacturers.

Mathai and Burns met in New Delhi on Friday to discuss bilateral issues and lay the ground for US Secretary of State John Kerry’s visit to India. Kerry and External Affairs Minister Salman Khurshid are scheduled to jointly chair the fourth strategic dialogue in New Delhi in the latter half of June.

This is going to be Kerry’s first visit to India after he took over as the US Secretary of State, succeeding Hillary Clinton, who along with his then counterpart S M Krishna had in 2010 launched the annual strategic dialogue between New Delhi and Washington.

Official sources said the foreign secretary had taken up with the American deputy secretary of state “matters relating to immigration reforms currently under consideration in the US and sought greater access for highly-skilled non-immigrant categories”.

The provisions in the Comprehensive Immigration Reforms Bill that could hit the Indian IT companies in America, as they seek to put in place a ban on client site placement for the workers with H1B visas, new restrictions on client site placement for the ones with
L1 visas and limits on total percentage of both H1B and L1 workers in the workforce of the US companies.

Burns told Mathai that US companies were looking for clarifications from the Indian government on whether the Preferential Market Access given to domestic telecom manufacturers on security grounds would be limited to government contracts or cover private procurements too.

Though India-US trade rose from $ 86 billion in 2011 to over $100 billion in 2012, the two issues are likely to cast a shadow over bilateral ties. The US-India Business Council – a body of American and Indian businesses – already took up both issues in Washington and New Delhi. Mathai and Burns also discussed commercial aspects and implementation of the India-US civil Nuclear Cooperation Agreement.

After President Barack Obama put in place a new administration following his re-election in November 2012, India and US already exchanged two high-level visits – Finance Minister P Chidambaram’s trip to Washington, Boston and New York and US Energy Secretary Steven Chu’s to New Delhi.

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