Tag Archives: visa

Immigration Blog, India Business, India-US Relations Blog

The Good, The Bad, and The Ugly

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A draft of a new US immigration law likely to be announced this week, holds mixed fortunes for international IT services companies and American businesses.

Globally competitive firms with offices in America, often send a number of foreign skilled workers on H-1B Visas to service American clients.  This helps boost operating margins and reduces costs on to American consumers.  The number of these Visas are currently capped  at 65,000 per year.

The legislation is seeking to increase the cap on H-1B Visas to 110,000, with an extra 25,000 for those who have earned advanced STEM degrees in the US.  This part of the bill has been warmly received by businesses and America’s friends and partners overseas.

However as part of a deal to create a pathway to citizenship for over 11 million people living in the U.S. illegally, other proposals in the bill will dictate to employers that they must pay workers on the highly skilled program on par with onshore workers and require businesses to advertise open jobs for 30 days on a U.S. Department of Labor website before they could bring in a foreign workers.

The result is that many U.S. business who have a significant contingent of overseas employees would be forced to pay significantly higher fees and endure larger operating costs.  For service based businesses like IT management, most of the operating costs are purely from labor.  Changing the pay rules may in effect drive many onshore companies out of business entirely, lowering tax revenues and in effect driving operations offshore completely.  In a growing migration to cloud based IT management, that possibility is ever more likely.

Concern is also being voiced that these provisions have been made for the specific purpose of targeting Asian individuals in the United States and overseas, and that campaigns for comprehensive immigration reform will merely descend into a vote-bank exercise for future elections.

Immigration Blog

The H-1B conundrum

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A new legislation intends to check H-1 B related frauds

Guest post by Madhu Nair

Ever since the 2008 economic crash, Americans have been accusing the H-1 B visa as an instrument used to steal their jobs. The United States is battling a high unemployment rate and the voice for a pro-American job policy is increasing day by day. With critics crying foul over the provisions of the policy and its abuse by technology majors, America’s H-1B visa policy has run into troubled waters.

According to a recent report, Senator Chuck Grassley, a ranking member of the Senate Judiciary Committee, has introduced a legislation which aims to eliminate fraud and abuse of the H-1B visa policy. The legislation intends to make reforms to increase enforcement, modify wage requirements and ensure protection of visa holders and American workers. Grassley says that the legislation will not only benefit American workers, but also help U.S. companies to get quality specialized workers from abroad.

Grassley adds, “Somewhere along the line, the H-1B program got side-tracked. The program was never meant to replace qualified American workers, but it was instead intended as a means to fill gaps in highly specialized areas of employment. When times are tough, like they are now, it’s especially important that Americans get every consideration before an employer looks to hire from abroad.”

The legislation, if passed, may affect jobseekers from India and elsewhere. The recently passed H-1B and L-1 Visa Reform Act of 2013 ensures that an H-1B application filed by a company employing 50 or more U.S. workers will not be accepted unless the employer attests that less than 50% of the its workforce are H-1B and L-1 visa holders. This, in addition, to the legislation introduced by Grassley could mean trouble for companies who seek cheap and quality workers, largely from developing economies. A recently published article had also highlighted that many of the H-1B hires do not belong to the “best and the brightest” category. This further pushed the need to reform the policy which has gained a political face of late.

With a cap of 65,000 H-1B visas a year, Indian companies were seen scrambling for approvals with over 50,000 applications being filed on the very first day of screening. Market analysts say that the cap on visas and other such compulsions will impact the margins of companies adversely. The increasing unemployment has also forced companies in the U.S. to take to sub-contracting and local hiring. This further adds pressure on companies to take to other means in order to achieve their ambitions.

While a short-term impact looks imminent, it would be better to come out with options to avoid such situations in the future. The global economy changed remarkably after the 2008 crisis with the world turning towards developing economies to pave the path ahead. India, with its growing young and abundant workforce, has an edge over other countries in reaping the benefits. But it would be rather cynical to neglect developed economies while doing so. The only way forward is to find a middle ground where countries can work together for a sustainable future.

Immigration Blog

H1B applicants not the best?

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Guest post by Madhu Nair

By definition, the H1B is a non-immigrant visa issued by the U.S. allowing companies to recruit foreign nationals in specialty occupations under the Immigration and Nationality Act. The act, practiced by a number of multi-national companies, has been their gateway to some of the best talents in the world. Aspiring workers from emerging economies like India and China have been quick to catch in on the rush. The practice gave companies an edge over their peers as it reduced their working capital, increased efficiency and scaled up their businesses. For employees, on the other hand, this was an opportunity to realize and live the American Dream.

But if a recent report is to be believed, the quality of H1B workers does not fit the category of “the best and the brightest”. Norman Matloff, professor of computer science at the University of California in Davis along with the Economic Policy Institute, published a study which compared U.S. and foreign IT workers’ salaries, rates of PhD awards, doctorates earned and employment in research and development to determine if H1B visa holders had skills beyond those of U.S. IT workers. As per Matloff, the study did not give any indication of exceptional talent among the H1B holders. He says, “We thus see that no best and brightest trend was found for the former foreign students in either computer science or electrical engineering,” He further writes, “On the contrary, in the CS case the former foreign students appear to be somewhat less talented on average, as indicated by their lower wages, than the Americans.”

Nevertheless, managers at top companies insist they still are not able to source the best minds domestically, forcing them to look beyond boundaries. For Peter Cappelli, professor of management and director of the Center for Human Resources at the Wharton School, this does not sound reasonable enough. In a Wall Street Journal article in October 2011, he argues, “Some of the complaints about skill shortages boil down to the fact that employers can’t get candidates to accept jobs at the wages offered. That’s an affordability problem, not a skill shortage.”

For countries such as India and China, who account for a major share in the H1B program, this should set alarm bells ringing as it may affect their nationals directly. Coming to India, the number of H1B visa approvals saw an upward trend for the year 2012. In the fiscal year 2012, 130,000 H category visas were issued as against 114,000 issued in FY 2011, an increase of 15%. The year, however, saw a 26% increase in denial rate with respect to the number of applications. The rise in denials was mainly attributed to the growing concerns over the business models used by Indian IT consulting companies. This led to heightened scrutiny by the consulate officials which saw the number of approvals go down.

With U.S. still recovering from the 2008 crash and Eurozone yet to come out of the sovereign debt crisis, the current scenario does not look good either. While there is no immediate threat to H1B workers, a relook at the quality of education may perhaps save them the axe. India and China both boast of a large number of highly skilled workers. However, with the current report out, officials and analysts in the U.S. may hesitate to hire anybody from these countries.

The solution, however complex it may be, lies in accurately nipping the problem at the source. There is a need for governments to work together towards a future void of any such conflicts that may lead to a human resource problem. The interests of US’ domestic workers need to be protected, whereas those of H1B applicants also need to be carefully studied. A pragmatic and sensible solution will not only prevent discontent among many, but also lead to a better environment at workplaces.

 

Immigration Blog

Will A New Bill Aid International Students with Ph.D.s – and Others?

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The Wall Street Journal has reported that House Judiciary Committee Chair Lamar Smith (R-TX) plans to introduce legislation to provide extra green cards for certain international students. (Find article here, registration required.)

As described, the legislation would likely have a positive impact on skilled immigrants.

For several years there has been great interest in the high tech community in exempting graduates of U.S. universities from employment-based green card quotas. In particular, the focus has been on individuals with advanced degrees from U.S. universities in science, technology, engineering or mathematics (STEM) fields. Some high tech executives have referred to such legislation as stapling a green card to the diploma of certain international students. In fact, a bill by Rep. Jeff Flake (R-AZ) is called the STAPLE Act (H.R. 399).

What Would New Legislation Likely Include?

The Wall Street Journal summarizes the likely contents of a new bill aimed at international students with Ph.D.s: “Rep. Lamar Smith (R., Texas), chairman of the House Judiciary Committee, said he plans to introduce legislation providing up to 10,000 visas a year to foreign students graduating from US universities with doctorates in engineering, information technology and the natural sciences.”

It is unclear from the description whether the intention is to create a new category or an exemption from the current 140,000 annual quota for employment-based green cards.

Which Universities Would Be Eligible?

A key question in any proposed legislation is whether degrees from all universities will allow international students to qualify. One concern expressed by lawmakers is a “diploma mill” could come into operation seeking to attract students by offering a way to gain a green card easier. For that reason any legislation is likely to restrict degrees to those obtained from universities in operation for a number of years and possibly only “research” universities. The definition of research universities and how many would be included in such a definition will remain an issue.

Which Degrees Would Be Eligible?

Another issue is whether legislation would be restricted to only Ph.D.s or to include recipients of masters degrees as well. Based on the Wall Street Journal article, it appears Rep. Smith would like to limit any bill to Ph.D.s. only.

A related matter is Ph.D.s in which fields. Members of Congress have focused on degrees in science, technology, engineering or mathematics (STEM) fields. It is possible Rep. Smith’s legislation would be narrower. In the interview with the Wall Street Journal, Rep. Smith mentioned engineering, information technology and the natural sciences as eligible areas.

Job Offer

It is likely any legislation would require the individual receive a job offer from an employer before being eligible for a green card.

Labor Certification

One of the most burdensome aspects of the employment-based immigration process is labor certification. That is a process that can cost employers several thousand dollars and can take 6 months to two years to gain approval from the U.S. Department of Labor. The process is meant to show no other qualified American is available to fill the job. Proving that often involves paying for advertisements and showing the results to the Department of Labor. Any exemption or special visa would be much more desirable if the applicant did not have to endure the labor certification process.

Likely Impact

Legislation limited to Ph.D. recipients would have a two-fold impact. First, it would likely allow for a green card to be received in a timely fashion for such individuals without regard to country of origin. (One assumes any legislation would exempt the recipients from the per country limit.) Even individuals who earn a Ph.D. could wait years for a green card in the employment-based second preference category if they are born in India or China. Second, adding extra visas to the employment-based immigrant category would free up numbers even for individuals who are not eligible, thereby reducing overall waiting times by a modest amount.

Rep. Smith’s bill would be notable because a bill introduced by the chairman of the committee with jurisdiction, in this case the House Judiciary Committee, has a far greater chance of moving through the legislative process than bills introduced by other members of Congress. Once introduced, it will be legislation worth watching.

 

India-US Relations Blog

India and America: common values, shared success

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By Richard G. Lugar

As Secretary of State Clinton’s recent trip to India demonstrated, these are exciting times for India, and for the India-United States relationship. India has liberalized and opened its economy, unleashing the entrepreneurial talent of its people and using its strong technology base to establish leading positions in such fields as telecommunications, information technology and pharmaceuticals.

America and India, for too long estranged during the Cold War, have developed steadily closer ties built on a uniquely strong foundation: both countries are stable, multi-ethnic democracies with a deep tradition of religious tolerance.

With a well-educated middle class that is larger than the entire U.S. population, India can be an anchor of stability in Asia and a center of economic growth. It is already the world’s second-fastest growing major economy, and bilateral trade with the U.S. has more than tripled over the past 10 years. I have worked to build a strategic partnership between the United States and India that will benefit both sides as India plays an ever-larger role on the world stage.

I am also excited by a new opportunity to match India’s entrepreneurial zeal with America’s current need for investment and jobs through the Startup Visa Act, which I introduced earlier this year. The bill would allow an immigrant entrepreneur to receive a two-year visa if he or she can show that a qualified U.S. investor is willing to invest in the immigrant’s startup venture. Many of India’s smartest and most entrepreneurial individuals are already here studying at our universities, so helping them stay to invest in their ideas would create jobs and help all Americans.

The bill would also apply to those already in the U.S. on unexpired H-1B visas, and entrepreneurs living outside the United States who already have a market presence here. If this legislation is enacted, it will help more Indians take part in the great American tradition of immigrant business success.

Another concern of Indians abroad is Pakistan, a concern I share. I believe the U.S. should use its influence to promote stability in the region, which could lead to a Pakistan that is more likely to cooperate and trade with India. That’s one of the reasons I co-sponsored the 2009 Enhanced Partnership with Pakistan Act.

The bill emphasizes economic assistance over military aid, and contains incentives for Pakistan to stabilize its democracy. It requires the Secretary of State to certify every year that Pakistan is meeting specific benchmarks of conduct, namely, that it is cooperating to dismantle supplier networks of nuclear weapons-related material, that it is making “significant efforts” to combat terrorist and extremist groups and that such groups are not receiving support from Pakistan’s military or spy service, and that it is not letting terrorist groups use Pakistan’s territory to stage attacks on other countries.

On that score, the bill specifically mentions Pakistan-based terrorist groups that threaten India as well as the United States and Afghanistan, including al Qaeda, the Taliban and Lashkar-e-Taiba, which conducted the 2008 Mumbai attack. The legislation aims to encourage Pakistan to re-orient its armed forces to a mission more focused on counter-terrorism and counter-insurgency than regional conflict, and calls for a cut-off of assistance if the security forces are deemed to be “subverting the political or judicial processes of Pakistan.” In short, India has much to gain from the success of this legislation.

All this is part of a larger strategic engagement between India and America, which took a major step forward three years ago with the passage of the US-India nuclear cooperation agreement, a step that I strongly supported. The legislation lifted a three-decade American moratorium on nuclear trade with India and opened the door for trade in a wide range of other high-technology items, such as supercomputers and fiber optics.

Some critics called the deal a set-back for U.S. non-proliferation efforts, since India remains outside the Nuclear Nonproliferation Treaty (NPT). I argued, however, that it actually provides incentives for the United States and India to deepen their cooperation in stopping proliferation, and confers numerous other benefits outside the nuclear realm by paving the way for broader economic and strategic collaboration.

The remarkable deepening of US-India ties over the past decade is only a start, as the relationship has still not reached its full potential. If Indians and Indian-Americans continue to contribute their ideas, their energy and their commitment, I am sure that even more exciting days lie ahead.

(Senator Richard Lugar is the Republican leader of the U.S. Senate Foreign Relations Committee.)