The move by the U.S. to restrict non-immigrant visas, including the H-1B, until the end of 2020, is “misguided and harmful to the U.S. economy,” Indian software industry body Nasscom said.

Noting that virtually every segment of the American economy, including manufacturing and medicine, employ skilled workers from other countries for innovation and productivity, Nasscom urged the U.S. administration to shorten the duration of curbs to 90 days.

“Lengthening these burdensome restrictions on U.S. companies that are trying to recover from the economic fallout of the COVID-19 pandemic will only serve to harm our economy,” it said.

It added with very few exceptions, Indian nationals and others, who are granted new H-1Bs or L-1s as well as other visa types after June 23, will not be allowed to enter the United States until the proclamation expires.

“American workers are facing greater challenges than they have in years, but that does not mean that talent shortages do not continue to exist,” Nasscom said, pointing out that despite national unemployment trends across the economy, the National Foundation for American Progress found that the unemployment rate for computer professionals actually dropped from 3% in January 2020 to 2.8% in April 2020.

The Confederation of Indian Industry expressed disappointment with the order, stating businesses across the U.S. rely on temporary visas to supplemen local hiring efforts and enable highly-skilled and talented professionals from across the world to enhance U.S.’ competitiveness globally.

Mildly negative

As per research agency ICRA, the move will be “mildly negative” for the Indian IT services sector considering their high dependence on such visas.

Currently, Indian IT Services is the major beneficiary of the H-1B visa programme. USCIS issued a total of 3,88,403 H-1B visas during FY2019 (October 2018 to September 2019 period) including fresh and renewals of which the share of India stood 71.7%, ICRA said.

Reiterating the critical role played by highly skilled non-immigrants, Nasscom said without their continued contributions to the U.S. economy, the economic pain would worsen, industry would slow and the timeline for a treatment and cure of COVID-19 would lengthen.

“Moreover, the people who come to U.S on H-1B and L-1 visas pay taxes and contribute to their communities and to local economies in myriad other ways as well,” it said.

Nasscom added that coming on the heels of the problems created by the coronavirus crisis and the USCIS and DOS office closures that have delayed the processing of visas and made it difficult, if not, impossible at times to travel to or from the United States, this new proclamation “will prevent our companies and thousands of other organizations from accessing the talent they need from overseas”.

As per a recent CII report, 155 Indian companies have invested nearly $22 billion in the U.S. economy and generated or safeguarded 125,000 jobs, while also funding research, innovation, CSR and reskilling programmes in the U.S.

“Even though our companies have hired tens of thousands of Americans and invested billions of dollars in recent years, they, like others in the sector, utilize such high skilled individuals to service their clients. This new proclamation will impose new challenge and possibly force more work to be performed offshore since the local talent is not available,” Nasscom said.

Nasscom further pointed out that thousands of U.S. corporations, universities, medical facilities, research institutions, directly and through their associations have asked the President not to take such action because of the harm it would do now and going forward, as the country reopens and recovers. Such sentiments were also echoed by dozens of Republican and Democratic members of Congress and governors, it said.

Business groups including Nasscom, the U.S. Chamber of Commerce, the American Medical Association, Compete America, the National Association of Manufacturers, and the Association of American Universities had written to the President that policies such as these undercut the ability to grow and create jobs, inhibit the provision of critical infrastructure services, and add burdensome new regulatory requirements and costs.

It also expressed hope that the Administration will rethink its stated plans to move forward on a series of regulatory changes that would place additional restrictions and costs on visa programmes while doing little more than amplifying the harm already being done to the U.S. economy.

“In this time of COVID-19 crisis and recovery, the Administration’s policies that impact American businesses should follow the oath taken by healthcare professionals: first do no harm,” Nasscom said.