India terms H1B visa fee hike discriminatory

“It is inexplicable to our companies to bear the cost of such a highly discriminatory law,” Commerce Minister Anand Sharma said in a statement.

Both Houses of the US Congress have passed legislation that would raise fees for H1B and L1 visas, which outsourcing companies use to send workers to the US for project work. The fee hike would only be levied on companies where over half of US-based employees use work visas. The US has sought to increase the visa fees to raise resources to fund heightened security on the US-Mexico border.

Shooting off a letter to the US Trade Representative Ron Kirk the Commerce Minister said: “It is estimated that the Bill will have an additional cost implication of over $200 million annually and an adverse impact on the competitiveness and commercial interests of Indian companies sending professionals to undertake projects locally for American customers in the US.

“Though the need of the US government to strengthen their border security is understandable, it is inexplicable to our companies to bear the cost of such a highly discriminatory law.”

Sharma pointed out that the Indian software industry was already deeply burdened in the absence of a totalisation agreement, requiring them to pay more than $ 1 billion every year to the US government in the form of social security, with no benefit or prospect of refund.

Sharma said the Bill would impact primarily companies of Indian origin, which account for less than 12 per cent of the total visas issued by the US.

While the United States companies use these visas in larger numbers, they will not be liable for the increased fees and Indian companies will be affected as they are more likely to cross the threshold of 50 per cent of the employees being on H1B and L visas, the minister pointed out.

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