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H-1B visa restriction may affect US IT production: Report

The Center for Global Development (CGD) in a report titled as 'The IT Boom and Other Unintended Consequences of Chasing the American Dream' said that H-1B visa is advantageous for both India and the US.

By: Express Web Desk | New Delhi |
August 8, 2017 2:37:36 pm
H1 b visa, H 1 B visa benefit, US economy, what is H 1B visa, india us workers, Indian economy, indian express news, world news The H-1B visa is a non-immigrant visa that allows US companies to employ foreign workers in speciality occupations that require theoretical or technical expertise in specialised fields. (Representational image)

The restrictions on H-1B visa programme will lead to the Information Technology (IT) sector in the US lose its competitive edge in the market. A top American think-tank said that US IT sector will find it difficult to attract open talents from India and America, PTI reported.

The Center for Global Development (CGD) in a report titled ‘The IT Boom and Other Unintended Consequences of Chasing the American Dream’ said that H-1B visa is advantageous for both India and the US. Gaurav Khanna, fellow at the CGD and co-author of the research paper, said, “It is really important to make sure that the I-T sectors from both countries are allowed to attract the right kind of people, because they really allow for innovation and growth in both the countries.”

The report gives a detailed description of how the H-1B visa programme affects the economies of the both the US and India. Khanna told PTI, “Both the economies have really benefited from the H-1B programme.” He also warned that the IT companies might look for other options and move to Canada if the H-1B clampdown will happen. He said, “What our paper is really trying to stress, is that on average the US is better off because of the H-1B programme. So clamping down on the H-1B programme will basically not allow the US IT sector to attract the open talent from places like India. The US might then lose its competitive edge in IT production.”

He added, “If you think about what happens in India, you know the prospect of migrating to the US and earning such a high wage …it seemed they really encouraged certain students and workers to acquire skills that would be valued by the H-1B programme.”

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The research report examines the relationship between migration and the outsourcing of IT production to India since the early 2000s and says that because of the H-1B programme, US workers are on average better off by about $431 million or $1,345 per additional migrant in 2010. It also includes crucial mechanisms like innovation by businesses, trade with other countries, and the choices made by students and workers to become computer scientists, a PTI report said.

The research also helped to know that the overall productivity is benefitted due to better technology, as a by-product of this immigration of tech workers. Khanna said, “The average worker in each country is better off because of immigration, and US native workers have made big gains because of the H-1B visa programme. Yes, there may be things that can be done to blunt distributional impacts that affect a subset of workers, but overall, this policy has been a net-positive for the US economy and workers.”

“Together, the brain-gain to India under the H-1B programme outweighs any brain-drain,” the report said. Khanna said that the increase in IT sector productivity allowed India to eventually go ahead of the US in software export because of the additional knowledge and skills that the workers learned in US before the expiry of the visas.

The H-1B visa is an employment-based and non-immigrant visa category for temporary workers. It permits US companies to temporarily recruit foreign workers. Indian IT giants like TCS, Infosys and Wipro are among the major beneficiaries of this programme.

(With inputs from PTI)

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