H-1B visa debates roil U.S.-India relations ahead of Trump-Modi meeting. Here’s what to fix

The United States is at a turning point—can it stay ahead in a rapidly changing world, or will it let outdated policies push top talent elsewhere? Nowhere is this question more relevant than in its evolving relationship with India.

For years, Indian talent has contributed to and helped fuel U.S. innovation. Many have taken advantage of what is known as the H-1B visa program, which allows employers to temporarily employ “highly-skilled” international workers in the United States on a non-immigrant basis. Some have come as students, studying and returning home, while others have ultimately immigrated, becoming U.S. citizens and further enriching the United States.

More than 330,000 Indian students are currently enrolled in American universities, and Indian professionals received 72.3% of all H-1B visas issued in FY 2023. In the 2023-2024 academic year, India surpassed China (and all other countries) in sending students to U.S. institutions, reclaiming its top position for the first time since 2009, according to the latest Open Doors Report on International Educational Exchange.

The return of U.S. President Donald J. Trump, combined with the June 2024 reelection of Indian Prime Minister Narendra Modi (albeit as part of a coalition now), sets the stage for even stronger U.S.-India relations. This remains true even amid the public debates about the H-1B visa program among some of Trump’s senior-most supporters—and about immigration’s importance to U.S. business more broadly.

Next week, Modi will visit Trump at the White House. As their nations double down on economic self-reliance—through a respective focus on “Made in the USA” and “Make in India”—the big question is not whether the two nations can coexist but how they can collaborate to build a stronger, interconnected future.

“This is such an important relationship, and it’s such a great opportunity for people-to-people, company-to-company, and government-to-government to make a difference in the world,” said then-outgoing U.S. Ambassador to India Eric Garcetti on the Heard in the Corridor Podcast (recorded on the sidelines of a Milken Institute summit in Abu Dhabi).

The U.S.-India relationship is not a rivalry; it is an advantage. Both countries are leaders in technology, education, and economic development. Working together is not just smart—it is essential for shaping the future. Garcetti described the partnership as “an awakening” for Americans to recognize India’s cultural and economic potential.

And Garcetti’s predecessor, Kenneth I. Juster, recently told ABP Live that even amidst the “speed bumps” of trade, tariff, and immigration issues, Trump will make sure that the U.S.-India bilateral relationship remains “very strong.”

Can ‘Made in America’ and ‘Make in India’ succeed together?

With both countries prioritizing domestic growth, can “Made in America” and “Make in India” thrive side by side? The answer depends on smart policies, investment collaboration, and a shared commitment to innovation that benefit both nations.

What’s the upside? More resilient supply chains, job creation, and access to larger markets. In recent years, India has significantly increased its foreign direct investment (FDI) into the U.S. As the fastest-growing large economy in the world and with a population over 1.4 billion, India is the world’s fifth-largest economy, with a GDP of $3.4 trillion. It’s expected to surpass Japan and Germany by the early 2030s to become the world’s third-largest economy, according to the U.S. State Department’s “2024 Investment Climate Statements: India” report.

Numerous Indian companies investing in the United States are not just expanding their business presence but are also contributing to and becoming part of local American communities. The opposite is also true in India. This is not just about short-term business requirements or “corporate social responsibility”—it is about long-term impact and building businesses and relationships that last.

What’s at stake as both the United States and India seek to build on already strong U.S.-India ties? If the U.S. does not appropriately modernize its immigration and trade policies, top Indian talent that might have helped further drive economic growth in the United States may well take their skills to Canada, Australia, and the United Kingdom.

If India leans too heavily on protectionist policies, it could limit key U.S. investments that drive mutually beneficial innovation and economic growth. At the same time, under both Republican and Democratic administrations, the U.S. has also shown signs of increasing protectionism, particularly in sectors like technology and manufacturing. Measures such as the bipartisan CHIPS and Science Act of 2022 (which aims to bolster domestic U.S. semiconductor manufacturing) and tighter scrutiny on foreign investments reflect a growing trend of economic nationalism on both sides. The challenge lies in ensuring that these policies do not hinder a mutually beneficial partnership while addressing legitimate national and economic security concerns.

How to strengthen the U.S.-India partnership

To keep the U.S.-India partnership strong, both nations need to take action. The United States must update immigration laws to attract and retain top talent while creating investment-friendly policies for cross-border collaboration. At the same time, India needs to remain open to foreign investment and knowledge exchange. Strengthening people-to-people engagement between India and the United States is also critical. The American and Indian people are the magic ingredient in U.S.-India relations in this transformative era.

Garcetti put it simply: “We already have more Indian students in our higher education institutions than from any other country. This exchange enriches both nations, and we need more Americans to study in India to create a two-way knowledge flow.”

Amidst recent headlines about China’s significant advancements in artificial intelligence, the United States would also be wise to not ignore India and the opportunities for partnership. Strikingly, Trump recently said the sudden rise of the Chinese AI app DeepSeek “should be a wake-up call” for America’s tech companies.

India is increasingly stepping into the spotlight as a leader in AI, digital technology, and advanced manufacturing. The United States must recognize this shift and engage with it, or risk losing access to one of the world’s fastest-growing innovation hubs and potential partners.

“India is moving to the center stage of innovation—where design, engineering, and cutting-edge technology are taking over,” Garcetti noted. “It’s a testbed for AI applications across industries and languages.”

The power of investment and collaboration

FDI is no longer a one-way street. Indian companies are contributing to reshaping the U.S. economy. Consider India’s JSW Steel investing in Texas to enhance steel production capabilities, contributing to local job creation. As Garcetti put it, “JSW’s investment is a prime example of how cross-border collaboration works for everyone—strengthening economies while advancing clean energy goals.”

This partnership is about more than trade—it’s about shared values, global leadership, and a vision for the future.

“If you want your life or your business to be about something consequential, come to India,” Garcetti added. “If you want it to be compelling, come to India. And if you want to navigate the challenges of today’s world, the U.S.-India partnership is the place to start.”

Two decades ago, in response to the tragic 2004 Indian Ocean earthquake and tsunami that killed more than 200,000 people, a new type of diplomacy and cooperative partnership was formed by “the Quad”—Australia, Japan, and, critically, India and the United States. As with any partnership, however, the team is only as strong as its component parts and their commitment to work together.

The opportunity for Trump and Modi, and the people of the nations they lead, is significant.

Now is the time for action. The United States and India must both double down on investment, policy reform, and technological collaboration. The future won’t be built by those who retreat—it will be shaped by those who seize the opportunity to innovate together.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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