‘H-1B impact on remittances to be under $5bn’

MUMBAI: The impact of restrictions on H-1B visas by the United States on remittances by overseas Indians would be within $5bn, according to a Barclays research report. The report also said that the rising trend of global capability centers (GCCs), which includes many US-headquartered firms, is here to stay and would strengthen further amid this likely H-1B overhaul, instead of acting as a drag on services exports. Earlier this month, US President Donald Trump announced two changes for the H-1B visas: a one-time $100,000 fee for new visas, and a wage-based selection process, which replaces the existing lottery-based selection system, favouring higher-skilled and higher-paid applicants by giving them multiple entries in the selection pool.“The impact of these new rules, in terms of likely loss of jobs and dependent livelihoods cannot be discounted, but the effect via remittance is unlikely to breach $5bn (out of a total of $83bn). Other countries (Germany, Canada) have already started showing interest in attracting highly-skilled Indian talent and we expect some redistribution of movement over the medium term,” said Barclays. The US accounts for 62% of India’s IT and IT-enabled services exports, but industry growth has not been driven by US-based employment.