Clinton, Krishna discuss US visa fee hike

New Delhi: External affairs minister S.M. Krishna raised US visa fee increases that have hit India’s information technology (IT) companies with US secretary of state Hillary Clinton when he met her in New York on Monday.

add_main_imageKrishna said the 45-minute bilateral discussion was “positive and productive”, according to PTI. The two, who are in New York for the United Nations General Assembly meeting, also discussed India’s improved trade ties with Pakistan and the Wisconsin gurudwara shooting.

Krishna said he didn’t expect any immediate action with the US presidential election due to be held on 6 November.NextMAds

“The US elections are here. It would be too much to expect any assurance from that side,” he told PTI.

In August 2010, the US nearly doubled fees for companies sponsoring foreign workers on H-1B and L-1 work visas as part of the US Border Security Bill. This was in order to help fund costs of securing the US-Mexico border. Since then, the Indian government and the National Association of Software and Service Companies (Nasscom) lobby group have been trying to convince the US to reverse its decision.

The fee increases have forced some Indian IT companies to send fewer workers to the US, according to Alok Shende, an analyst with Acentius Consulting. They either hire American workers at higher cost or send more of the work out of the US, he said.

“This is a sector that earns millions of dollars for the Indian economy and there will be a shift in employment from India to the US,” said Shende. “There’s been a change of the status quo and the change has not been good for India or Indian firms. So it’s good that Krishna is trying to...see what the US government can do.”

India has also threatened to bring up the issue at the World Trade Organization (WTO) later this year, though some analysts said such a move would be largely symbolic.

“It can be taken up in the WTO as a practice restrictive to international trade,” said independent consultant Eshan Joshi, formerly head of immigration at software company Infosys Ltd. “But immigration is a matter of sovereign rights, and each country has sovereign authority—so there is limited (scope) in terms of what pressure they can impose.”sixthMAds

More pressing than the issue of visa fee hikes, according to Nasscom head Som Mittal, is the number of H-1B visas issued each year, which is down to 65,000 from 185,000 in 2005.

“This year H-1B visas were exhausted within three months of opening, which clearly shows that there’s a large demand,” said Mittal. “So, from a US perspective, if the visa numbers are increased, it could start impacting US industry itself because there is a shortage of tech resources.”

Given that the US is in the midst of election season, it’s unlikely the Krishna-Clinton visa talks will have any immediate effect, said Ganesh Natarajan, global chief executive of Zensar Technologies.

“But what could happen is you’re sensitizing the government that these issues do need to be addressed, so when the next administration moves in, they are cognizant that economic growth needs to be stimulated, and that this needs to happen,” he said. “These talks are always good at any time—and perhaps could lead to a more tolerant administration from January onward.”

PTI and Reuters contributed to this story.