Indian Workers on H-1B Visas Could Be Casualties of a U.S. Trade Spat

June 21, 2019, 2:00 AM UTC

With the trade war between the U.S. and China regularly dominating headlines, it’s easy to forget that the U.S. is also engaged in trade disputes with other countries, such India.

Unless, of course, you’re an Indian worker who wants to get a job in the U.S. Because if that’s the case, then your opportunities might be about to get more limited.

Having recently cancelled concessions on the importation of almost 2,000 Indian products—a move that prompted New Delhi to impose higher tariffs on American goods—the U.S. is now reported to be threatening new caps on the numbers of Indians that can get an American H-1B work visa. The U.S. State Department denies that the Trump administration is mulling this.

However, if the report is correct, tens of thousands fewer Indians might be able to get U.S. work visas each year. This could have a big impact on Indian companies with a U.S. presence—the visas allow people to stay there for up to six years—and also on Silicon Valley, where many H-1B-holding immigrants are employed.

Data localization

According to Reuters, the idea is not to explicitly target India with the move—the White House probably lacks the authority to do that—but rather to threaten new H-1B visa limits on countries that have so-called “data localization” laws.

The State Department denied this, saying: “The Trump Administration has no plans to place caps on H-1B work visas for nations that force foreign companies to store data locally.”

Data localization policies force companies to store the personal data of a country’s citizens on servers located in that country. India waded into these waters last year when its central bank, the Reserve Bank of India (RBI), said all Indian transaction data had to be stored in India and nowhere else.

As is generally the case with data localization laws, the given reasons included aiding Indian law-enforcement investigations and providing better security to the country’s citizens. However, the U.S. lobbied against it—after all, many of the affected tech and financial firms, from Visa and Mastercard to Google and Amazon, are American. And when the implementation deadline arrived in October, many of those companies were not ready.

The argument is still ongoing. Just this week, the RBI promised the companies it would “look into” their concerns.

Targeting India

As for how the U.S. H-1B visa cap would specifically target India, that’s a function of how many of the 85,000 such visas granted each year go to people from the country.

The new cap for countries with data-localization laws is reportedly between 10% and 15% of all H-1B visas issued. India isn’t the only country with data-localization laws—China and Russia’s versions are much more restrictive—but as much as 70% of H-1B visas currently go to Indians. That means the cut would disproportionately hit people going from India to the U.S. for work.

The Times of India spoke to several lawyers who mostly said the matter could end up before the U.S. courts if President Donald Trump tries to push through the change by executive order, as the rules for allocating H-1B visas were set out by Congress, and it’s not up to the president to change them. A Democrat-controlled House is unlikely to approve of Trump’s move, they said. However, one lawyer—NPZ Law Group’s Snehal Batra—pointed out that congressional approval might not be required if the overall number of H-1B visas was not being changed.

Ultimately, the move could fall foul of the rule in the U.S. Immigration and Nationality Act that forbids discrimination against any particular country when issuing visas, immigration attorney Cyrus Mehta told the newspaper.

That law was also cited in the judicial pushback against Trump’s “travel ban” against people from majority-Muslim countries.

This article was updated to include the State Department’s statement.

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