Is America not a free country anymore?

The Indian Economist, February 2, 2017

By Pradeep S Mehta and Kyle Cote

After a year of election rhetoric by President Donald Trump on immigration has quickly put into action by signing executive orders, proving that he’ll stand on his controversial election promises. Signed on Friday, the executive order makes more than 134 million people temporarily homeless.

What is the order?

According to the orders, the United States bans in-migration from seven majority-Muslim countries: Iran, Iraq, Libya, Somalia, Sudan, Syria, and Yemen for 90 days, suspends refugee admission for 120 days only allowing exceptions for ‘case-by-case’ and indefinite ban on Syrian refugees. As details of the order were vague and issued with limited coordination, Customs and Border Protection agents at U.S. airports were left to interpret on their own how to proceed amongst the chaos.

US President Donald Trump signs an executive order in the Oval Office of the White House on January 30. He may soon be signing one related to H-1B visas | Photo Courtesy Getty Images

Regulation of H1-B visas

Regulations had already been tightening on the movement of skilled labour in businesses and IT to the U.S. due to the Consolidated Appropriations Act of 2016 that increased L-1 and H-1B visa fees for companies with more than 50 employees. Additional bills are being reintroduced in the Congress, such as the ‘Protect and Grow American Jobs Act’. This bill would require workers on the H-1B visa to pay a minimum of US$100,000, up from US$60,000 currently. It also removes the exemption for Master degree holders to cap the number of visas available. Taking stock of the visa situation, India had brought a complaint to the WTO requesting for consultation on U.S. temporary work visa situation, whose dispute settlement has been delayed.

But Mr Trump’s ‘America First’ stance that not only prioritises national security but also American workers is expected to restrict legal work migration into the U.S. even further.
This would affect H-1B visas by altering the program to shorten the duration of stay, limit visas for spouses, reverse training programs for STEM students, and suspend relief for those applying for green cards. Such regulations would require further legislation, but another executive order will achieve a temporary ban targeting professionals.
There’s a looming threat to non-U.S. working professionals caused by investigations of the Department of Labor on the extent of harm caused to U.S. workers by their presence and visits by the Department of Homeland Security to companies, U.S. and foreign owned. This will prove to be detrimental to diplomatic relations with countries like India that have contributed greatly to the U.S. economy.

How does this impact India?

Strengthening that threat further is Mr Trump’s Attorney General pick, Senator Jeff Session, a long-time critic of temporary work visas. While the most recent executive orders pertaining to immigration do not affect India directly, it is indeed a troubling sign of national security concerns that could lead to broader protectionism. If such anti-immigration moves continue, both executive and legislative, it could severely impact India’s economy and employment, considering that Indians account for half of US permanent work migration and 90 percent of Indian IT workers use H-1B visas. Remittances, which hovers around US$12 billion, would also suffer. The more than 150,000 American-educated Indian students looking to use their newly acquired skills in the U.S. economy would be in jeopardy if their practical training programs are taken away.

Many in India are hopeful that relationships between the U.S. and India will continue in a positive trajectory under the leadership of President Trump and Prime Minister Modi.
It could also negatively affect the U.S. economy, as Indian IT companies pay US$22.5 billion in taxes and provide hundreds of thousands of US-based jobs even as it attracts temporary Indian tech workers. The U.S. will sorely need such contributions from India since by 2022 it is estimated that the U.S. will have a shortfall of skilled labour of 17 million whereas India will have a surplus.
Many in India are hopeful that relationships between the U.S. and India will continue in a positive trajectory under the leadership of President Trump and Prime Minister Modi. As such, Indian foreign affairs officers and business community must unequivocally demonstrate to the Trump administration that its skilled and unskilled domestic labour, the kinds of jobs Mr Trump has called to return home, will not fill the gap if Indian professionals are blocked out of the U.S. labour market.

The authors work for CUTS International

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