India filed a World Trade Organization (WTO) complaint with the
U.S. on March 3, 2016, over the recent U.S. law increasing H-1B
visa fees. The new law which came into effect on December 18, 2015
requires certain companies to pay an additional $4,000 in
application fees. The fee hike applies to U.S. companies that
employ 50 or more employees in the U.S., with more than 50 per cent
of those employees in H-1B or L non-immigrant status.
The H-1B visa program allows employers to bring up to 65,000
foreign workers to the U.S. each year to fill jobs that require
"highly specialized knowledge." Critics of the
program argue that many companies take advantage of the H-1Bs to
displace American workers by importing foreign workers for lesser
wages. The new law increasing visa fees was passed by the U.S.
Congress as a bipartisan effort under increasing pressure from
interest groups and lobbyists to protect the interests of American
The H-1B fee hike will affect the information technology
industry in India from which huge numbers of H-1B petitions are
submitted every year with the U.S. government. India
generates more than $100 billion from its IT sector that thrives
largely by sending Indian workers to the U.S. and other countries
to develop software and set up computing systems. The H-1B visas
are typically used by thousands of Indian nationals hired by IT
companies operating in the U.S. Analysts say that the fee
hike will bring down profit margins of big Indian IT players - Tata
Consultancy Services (TCS) and Infosys starting this fiscal year in
In its complaint, India has stated that the new U.S. visa
measures seemed inconsistent with WTO commitments the U.S. had
made, because the move treats Indian IT workers in the U.S. less
favorably than their American counterparts. India states that the
new measure to double the cost of visas for these skilled workers
constitutes protectionism and violates the WTO's principles for
The two countries are preparing for bilateral discussions
probably in Geneva where the trade dispute arbiter is based. If no
mutual agreement is reached within 60 days of India's complaint
of March 3rd, India can request the WTO to establish a panel to
review the matter. It is likely this may not be resolved until
after the U.S. presidential election in November of this year.
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