US Treasury Secretary’s statement raises IT industry’s hopes
US Treasury Secretary Timothy Geithner expects an increase in the number of visas granted to Indians.
Though he did not give any details, the statement could be a boost to Indian information technology companies seeking more H-1 B work visas, an issue the industry has been trying to resolve.
The visiting Treasury Secretary discussed with Finance Minister P. Chidambaram how US business could contribute to India’s infrastructure and investment needs. They also explored ways to improve coordination on bilateral tax matters.
On the fear that outsourcing and jobs for non-US citizens may shrink after the Presidential elections in the US, Geithner said, “We expect significant increase in the visas.”
Experts from the Indian IT industry think this could be a positive message.
“There can be two interpretations: one, there could be an option to increase the cap of 65,000 visas in a year, which could be filled up in the next two-three months (before the year ends). Second, it can also mean removing the bottlenecks,” an IT industry expert who did not wish to be named told Business Line.
IT companies declined comment as they are in ‘silent period’ before their results are announced starting with Infosys on October 12.
Geithner has supported issuing more visas to Indians since last year under the H-1B visa programme, which is offered to highly skilled professionals and students to live and work in the US. Earlier this month, US Secretary of State Hillary Clinton, at a meeting with External Affairs Minister S. M. Krishna in New York, had said the US was going for a broader review of its visa regime, but it would have to await the outcome of the Presidential election next month.
The US had raised the H-1B visa fee to $2,000 per application and L1 to $2,700 per visa application to fund its enhanced costs on securing its border with Mexico under the Border Security Act.
The US Citizenship and Immigration Services (USCIS) in March said it would hike the H-1B visa fee from next financial year.
It listed a fee detail that started from a base fee of $325 to $2,000 for a company that employs 50 or more people in the US and has more than 50 per cent of its workers in the country on H-1B or L-1 non-immigrant status.
For the current year, USCIS is charging $750 for companies with 1-25 full-time employees and $1,500 for those with 26 or more full-time employees.
However, software giant Microsoft recently suggested the US government levy a fee of $10,000 for a new category of H-1B visas and $15,000 for permanent residence or green card.
That could raise around $5 billion over a decade in the country, but would hit Indian IT companies hard.
According to the company, new categories of H-1B and green cards would have an annual quota of 20,000 and restricted to people from science, technology, engineering and math backgrounds.
This augurs well for a large number of tiny, small and medium enterprises, who are doing onsite consulting. “They have been bleeding after the clamp on H1 B visas. A good number of them do 80 per cent onsite jobs and 20 per cent offshore. Shortage of H1Bs is hitting them very hard,” J. A. Chowdary, Chief Mentor of The Indus Entrepreneurs (TiE), said. This would help the IT majors as their implementation of several onsite projects had taken a beating in the last few months.
“Indian IT companies will benefit from this and it is a reinforcement of the talent available in the country,” said Jitendra Das, Director, FORE School of Management.
(With inputs from K.V. Kurmanath in Hyderabad and Venkatesh Ganesh in Bangalore)