A needless H-1B misstep

US President Donald Trump’s decision to impose a USD 100,000 annual fee on H-1B visas has proved to be counter-productive as the decision was all set to weaken the country’s technological leadership apart from altering relations with other countries. The decision had virtually forced US technological companies to rethink long-term strategies in hiring exceptional talents from outside the US. Thus, it was a mistake to interpret this very decision as another attempt to force India to dance to the US tune.

As a matter of fact, the decision of the US administration to hike H-1B visa fees was against the long-followed policy of granting 65,000 regular H-1B visas along with 20,000 more such visas for advanced degree holders from US universities. Such a decision was taken to fill the knowledge void to maintain the country’s hegemony in fields such as science, technology, engineering and mathematics.

Now, if the companies, which have provided the US all the necessary support to grow, order the H-1B visa holders to return unable to bear the rising cost, there is a possibility that about 90 per cent of the ongoing work in the above-mentioned fields will come to a standstill. This is why, realising the folly of the decision, the US administration has clarified that the hike in visa fees will only be applicable to new applicants. It has further stated that the hike is a one-time affair, not annual, and that current H-1B visa holders will be allowed to re-enter the country.

It may be mentioned here that during the first half of the ongoing year, major US companies like Amazon and others secured more than 17,000 H-1B visas for foreign nationals who are capable of creating Artificial Intelligence (AI)-driven next-generation platforms, cloud computing, etc. It is no gainsaying that all these companies virtually forced the US government to tone down its decision on H-1B visas within hours of the announcement, as the unusual visa fee had sent shockwaves through the industry.

So, there is no need for India to feel perturbed about the new US H-1B visa policy despite some initial hiccups. It may be explained here that Indians formed the major chunk of US H-1B visa holders. As per records, among all H-1B visa beneficiaries, Indians grabbed 71 per cent, with China coming a distant second at 11 per cent in 2024. This is why at first, it was thought that the decision was a big blow to India and various theories had started floating about Indo-US relations.

Undoubtedly, the decision created some chaotic situations and anxieties among Indians. Many bookings to visit India during the forthcoming festive season were cancelled, as in the absence of clarity, these H-1B visa holders had thought they might have to pay the hiked fees to re-enter the US again. It is good that better sense prevailed in time and the US decided to dilute the suicidal step considerably to keep its position as the front-runner in innovation and technology.