Employees of Wipro Limited outside the company's headquarters in Bangalore. Photo: AFP

Various business associations in India have expressed concern over the US government’s move to restrict H-1B and other non-immigration visas until the end of this year. President Donald Trump signed a proclamation late Monday claiming it will help bring down the country’s high unemployment rate amid the Covid-19 pandemic.

Trump said, “In the administration of our Nation’s immigration system, we must remain mindful of the impact of foreign workers on the United States labor market, particularly in the current extraordinary environment of high domestic unemployment and depressed demand for labor…In light of the above, I have determined that the entry, through December 31, 2020, of certain aliens as immigrants and non-immigrants would be detrimental to the interests of the United States.”

The administration claims the move would free up 525,000 jobs for its citizens. The new order, however, will not impact any current visa holders located either inside or outside the US.

The Indian National Association of Software and Services Companies said the new proclamation will cause disruption in the software industry and may lead to more work being performed offshore due to the absence of local talent.

“We urge the Administration to shorten the duration of these restrictions to 90 days. Lengthening these burdensome restrictions on US companies that are trying to recover from the economic fallout of the Covid-19 pandemic will only serve to harm [the] economy,” it said in a statement, Business Standard reports.

The association hopes the Trump administration will rethink its stated plan as it could lead to additional restrictions on visa programs and push up costs.

Indians are the largest beneficiaries of H-1B visas, receiving about two-thirds of the 85,000 new ones issued each year. In addition to Indian IT firms, these visas are also availed by US technology giants such as Google, Microsoft and Facebook. US-based Manpower Group, along with Swiss firm Adecco and Dutch firm Randstad, are among the large subcontractors that supply critical human resources to the global IT industry by availing these visas.

In fact, in recent years US firms have been cornering more H-1B visas – in 2019, seven of the top 10 beneficiaries were US-headquartered tech firms. Indian companies meanwhile have worked at localizing their talent mix in the US, reducing the number of H-1B visas they apply for each year.

In the US, the new proclamation was not well received in technology and business circles. Alphabet and Google CEO Sundar Pichai expressed disappointment. He tweeted, “Immigration has contributed immensely to America’s economic success, making it a global leader in tech, and also Google the company it is today. Disappointed by today’s proclamation – we’ll continue to stand with immigrants and work to expand opportunity for all.”

The US Chamber of Commerce, which represent top technology companies, said the move will hamper economic growth. In a statement, CEO Thomas Donohue said: “Today’s proclamation is a severe and sweeping attempt to restrict legal immigration. Putting up a ‘not welcome’ sign for engineers, executives, IT experts, doctors, nurses and other workers won’t help our country, it will hold us back. Restrictive changes to our nation’s immigration system will push investment and economic activity abroad, slow growth, and reduce job creation.”

Brad Smith, president of Microsoft, believes now is not the correct time to cut the US off from the world’s talent as America needs immigrants more than ever. “Immigrants play a vital role at our company and support our country’s critical infrastructure,” his post read. His post was retweeted by CEO Satya Nadella.

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