India Welcomes US Efforts to Lift Cap on Foreign Workers

By Suryamurthy Ramachandran | July 7, 2008 | 8:08 PM EDT

New Delhi ( - Indian software companies have cautiously welcomed US efforts to increase the number of foreign, skilled workers allowed to fill open jobs in the United States.

The House Judiciary Committee last week passed a bill that would remove the cap on the number of foreign workers allowed to come to this country on H-1B visas.

Under the H-1B visa program, foreign workers with special skills are allowed to work in the United States for three years, and since the visa can be renewed once, the workers often end up staying for six years.

US technology companies say they depend on foreign workers to fill a "job gap," in which key positions are left open by a shortage of skilled Americans available to fill them. The affected companies say the current H-1B visa quota is limiting their output, forcing some companies to consider moving production offshore.

India accounts for some 40 percent of the total number of H-1B visas issued. There are over 750 Indian firms in the Silicon Valley alone.

"This is a positive measure which will boost the growth of software industry," said the head of India's National Association of Software and Service Companies, Dewang Mehta.

The Technology Worker Temporary Relief Bill, introduced by Rep. Lamar Smith (R-TX) removes the cap on H-1B visas, but it adds other restrictions. Mehta said India's information technology industry is apprehensive about the bill's "caveats," which could make the visas harder to obtain despite the proposed removal of the visa cap.

Currently, there is an annual cap of 115,00 on H-1B visas, and unless Congress acts, that number will go down in the next few years.

This year, the quota was filled more than six months before the end of the fiscal year on September 30, with most of the H-1B visas snapped up by high-tech companies. (Other foreign workers who come to the United States on H-1B visas include fashion models, educators, and experts in diverse fields.)

Smith's bill requires that workers coming to the United States on H-1B visas earn at least $40,000 a year in salary and benefits. The company employing the workers would have to show that the median wage paid to its American workers had increased from the previous year.

Indian companies prefer an alternative bill, co-sponsored by Reps. Zoe Lofgren (D-CA) and David Dreier (R-CA), which calls for the cap on visas to be increased to 200,000 between 2001 and 2003, but does not include any new restrictions on employers.

Differences between the Smith bill and the Lofgren-Dreier bill will be worked out in the House Rules Committee, and from there, the legislation will go to the full House for further action. The Senate also is working on legislation to lift the cap on H-1B visas.

Far from taking jobs away from American workers, supporters of the program argue that H-1B workers actually create jobs for Americans by fostering the creation of new products and spurring innovation.

The planned changes in the H-1B category are seen as a result of pressure exerted by Indians living in large number in the United States and President Clinton's recent visit to New Delhi.

See Earlier Story:
Senate Bill Allows More High-Tech Foreign Workers in US (Feb. 2, 2000)