Have Received No Official Communication from US on Capping Number of H-1B Visas, Clarifies Govt

New Delhi: The Indian government is engaged with the United States Congress on H-1B work visas but has not heard anything official from Washington on capping such permits for Indians, the country's foreign ministry said on Thursday.

Reuters reported on Wednesday the US had told India it was considering caps on H-1B work visas for nations that force foreign companies to store data locally, according to sources familiar with the matter.

India foreign ministry spokesman Raveesh Kumar said there had been no official communication on the H-1B issue, but did not elaborate. The government remained in talks on the issue of data localisation, Kumar said.

The US plan to restrict the popular H-1B visa programme, under which skilled foreign workers are brought to the United States each year, comes days ahead of US Secretary of State Mike Pompeo's visit to New Delhi from June 25-27.

It also comes as trade tensions between the two nations have resulted in tit-for-tat tariffs in recent weeks. From Sunday, India imposed higher tariffs on some US goods, days after Washington withdrew a key trade privilege for New Delhi.

The Reserve Bank of India (RBI) in April last year asked payment firms to ensure their data are stored exclusively on local servers, setting a tight six-month deadline for compliance. That deadline was said to have been missed by some foreign firms, including credit card giants Visa and Mastercard.

Sources in the commerce ministry said no communication on the visa cap has been received from the US.

IT industry body Nasscom cautioned that any move by the US to limit visas for tech workers will weaken American companies that depend on these work permits to fill skills gaps and put jobs at risk.

Nasscom also highlighted that Indian nationals accounting for a large chunk of approved H-1B visas is a "testimony" to their skill-set, and pointed out that a "vast majority" of these visas were being sponsored by global and US multinational companies.

The statement came after a report said US was mulling 10%-15% cap on H-1B visa for nations that compel foreign companies to store data locally. Such a move gains significance amid a row between the US and India over trade and tariffs.

Nasscom - which represents Indian IT majors like TCS, Infosys, and Wipro as well as smaller tech firms - noted that there is no official confirmation yet on the development from the US government on the matter and that it is awaiting clarity from official channels.

"If US policy makes it more difficult to hire advanced tech workers, it will only weaken the US companies that depend on them to help fill their skills gaps, put jobs at risk, creating pressure to send technology services abroad," Nasscom said in a statement.

Such a move, if implemented, would have a major impact on the over $150 billion Indian IT sector that gets a lion's share of its revenues from the North American market. Indian IT firms use H-1B visas to send staff to client locations in the US.

However, increasing visa scrutiny over the past few years has compelled Indian IT services companies to ramp up local hiring in the US.

Nasscom said in April this year, the number of unfilled jobs stood at 7.5 million in the US. Of these, 67% - or two in every three jobs - required specific technical skills.