UPDATED 23:53 EDT / DECEMBER 20 2015

NEWS

Indian IT firms enraged over decision to double H1-B and L1 visa fees

India’s prime minister Narendra Modi has taken issue with President Barack Obama over the government’s move to double the cost of working visas for IT professionals, saying it could severely impact Indian IT companies that operate in the U.S.

The proposed increase in H1-B and L1 visa fees stems from a new bill called the “9/11 Health and Compensation Act” that aims to compensate families affected by the 9/11 terrorist attacks. To raise the extra cash, the bill necessitates that companies must pay more in order to secure a working visa to bring foreign workers to the U.S.

Modi’s issue is that Indian IT firms are among the heaviest users of those visas, and many of those have complained that the increased costs of the visa will impact their bottom lines. The change will reportedly cost Indian IT companies “millions of dollars”, as the rely on this work visa for highly skilled IT workers to get their work done in the U.S.  Indian IT companies have complained that the bill is “highly discriminatory and punitive” as the text of the legislation has been written in such a way that such a high fee would have to be paid by only major Indian IT companies, India’s The Hindu reported.

Modi reportedly raised the matter with President Obama during a recent phone call, saying that he “shared with President the concerns of the Indian IT industry and professionals on the proposed legislation in the U.S. Congress relating to H1B and L1 visas.”

Unfortunately for Modi, the issue of H1-B visas in particular has become something of a political hot potato with the upcoming U.S. presidential elections. Some of the candidates are proposing stricter rules on the issuance of said visas, arguing that doing so would boost local employment. In addition, critics say the H1-B visa is used as a way of keeping wages low, because many foreign workers are paid less than what their U.S. counterparts would demand. The flip side of that argument is that numerous studies have pointed to a severe shortage of skilled IT workers, particularly those with skills in Big Data and other nascent technologies. Therefore, the argument goes that the U.S. needs skilled foreign workers to make up the difference.

It’s likely that Modi’s concerns will fall on deaf ears though. Congress has already ratified the proposed doubling of H1-B and L1 visa fees to $4,000 a piece, with the extra money being earmarked as compensation for America’s 9/11 victims.

Photo Credit: India Kangaroo via Compfight cc

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