Why India may be the winner from Trump鈥檚 H-1B price hike
| Bengaluru, India; and Berlin
When the Trump administration in September raised the fee for an H-1B visa to $100,000, it set off a global race for the highly educated foreign professionals now frozen out of the United States.
In the search for the best and brightest minds on the planet, H-1B visas have proven a magnet of unparalleled success. Holders of the H-1B have been an essential element in building today鈥檚 American tech behemoth. The CEOs of Google and Microsoft had H-1B visas, as did Elon Musk.聽The activities of current and former H-1B visa holders account for as much as one-seventh of the American economy, according to calculations by Michael Clemons of the Peterson Institute for International Economics.
More than three-quarters of H-1B workers are Indian, so shortly after the policy change, Germany鈥檚 ambassador to India made a video with a plea 鈥� and a dig at the U.S. 鈥淲e do not change our rules fundamentally overnight,鈥� said Ambassador Philipp Ackermann. 鈥淗ighly skilled Indians are welcome in Germany.鈥�
Why We Wrote This
When Donald Trump hiked the cost of H-1B visas, Indian professionals looked to be the hardest hit. But with the West shunning immigrants, India may also be the beneficiary of the new pool of job seekers.
Yet in conversations with experts worldwide and with the very Indian talent now set adrift by the H-1B changes, the biggest winner, it seems, might be India itself.
The reasons are many, starting with America鈥檚 unique and virtually irreplicable role in global innovation. But anti-immigration policies also play a part, meaning the workers who acted as rocket fuel for America鈥檚 current economic dominance no longer feel they have any place to go.
鈥淚 definitely want to move abroad, but ... the laws have become very strict,鈥� says Gunjan Malviya, who works for an IT company outside Delhi and was seeking an H-1B visa before the change. Australia is an option, she says, 鈥渂ut Europe doesn鈥檛 seem like a place that鈥檚 growing or accepting outsiders in a welcoming manner.鈥�
鈥淓verything now feels like it鈥檚 come to a halt,鈥� she adds. 鈥淚 don鈥檛 know what my next steps are.鈥�
Less opportunity for Indians in the West ...
In speaking with young Indian talent, one thing becomes abundantly clear. The American Dream is still a powerful force inside India.聽
Nowhere else in the world combines vast amounts of money ripe for investment, a willingness to embrace risk, and comparatively little bureaucracy. The result has been a U.S. tech sector that dwarfs its rivals. And H-1Bs made those startups and tech giants the proving ground for generations of India鈥檚 most ambitious entrepreneurs. It appears those already in the U.S. on H-1Bs should be able to stay, as the increase in visa cost only affects new applications. But the pipeline is now essentially closed.
Working in the U.S.聽had聽been Parmesha Reddy鈥檚 dream since she was 12. She came here to Bengaluru鈥檚 Indian Institute of Science (IISc) to achieve it. But as she walks beneath the campus鈥檚 canopy of gulmohar and mahogany trees, she rubs her hands, unable to mask her worries. 鈥淢y father always wanted me and my sister to settle in the U.S.,鈥� she says. 鈥淗e saw colleagues鈥� children going there, getting jobs, and earning well.鈥�
Even now, weeks after the Trump administration鈥檚 decision, she says, her family has still not come to terms with it.
鈥淣ow, everything we planned for is disrupted,鈥� she says. 鈥淥ur careers are at stake. My father has worked hard for this, and my sister and I have put everything into following this path.鈥�
Neither the United Kingdom nor Germany can adequately fill that gap. First, the opportunities are fewer. While Britain has a strong startup culture, for instance, it lacks the venture capital to build the megacorporations that define and drive the industry. The U.S. has created a dozen tech companies worth at least $100 billion; Europe has none.
But this success has done more than provide opportunity, it has also forged a deep cultural connection. 鈥淭he Indian diaspora has marinated in the H-1B experience, so the gravitational pull [to the U.S.] will be very high,鈥� says Tom Hurd, founder of Zeki, a London-based firm that tracks top research and development talent worldwide.
That puts Europe at an inherent disadvantage. Anti-immigration politics have made it worse.
鈥淵ou say you want to grow the economy, but at the same time, you鈥檙e making it less attractive for people to move to the U.K.,鈥� says Nelli Shevchenko, a senior associate who works on immigration issues in London for employment law firm Sherrards.
Many Indians feel that. 鈥淓urope has always been very reluctant on that 鈥� immigrants as a way to grow,鈥� says Madhavi Arora, chief economist for Emkay Global Financial Services in Mumbai.
That leaves India鈥檚 rising stars unsure where to turn. Prasant Thapa, a graduate student at IISc Bengaluru, had secured admission to New York University for a master鈥檚 in data science. But with no opportunity for an H-1B visa after graduation, he withdrew.
In the crowded cafeteria, he voices his frustration as he nurses a drink and overhead fans churn through the humid afternoon. 鈥淚 look around the world, and there are not any good options, even close to what one could have expected from the USA,鈥� he says.
鈥淓urope seems like a very difficult place to move to because there are already strict regulations on visas, and finding a job is not easy.鈥� So he, too, is considering Australia or Canada, 鈥渂ut nothing is certain yet.鈥�
... But growing opportunity at home
Amid such uncertainty, the country most poised to take advantage could be India itself.
Its challenge is a lack of jobs with the profile or promise of those abroad. But that is changing. India is no longer merely a land of call centers and cost-cutting offshore operations. And the decline of H-1Bs could be an accelerant.
During the pandemic, India became a hub for 鈥済lobal capability centers,鈥� which act as remote headquarters in miniature. They 鈥渁re primed to evolve into innovation hubs,鈥� said Pravin Goel of global investment firm BlackRock during a . 鈥淭his is such a promising ecosystem for domestic startups.鈥�
Just last week, Google announced plans for a $15 billion artificial intelligence data center in India, which will be 鈥渢he largest AI hub that we are investing in anywhere outside of the U.S.,鈥� an executive said at a ceremony in New Delhi.
Mr. Hurd of the talent-tracking firm Zeki happened to be in India meeting with senior government officials and tech leaders when the H-1B announcement was made. 鈥淭hey were delighted,鈥� he says.
The shift is already underway. His data suggest that 36% of the top AI talents globally are in the U.S., with about 6% in the U.K. and another 6% in Germany 鈥� numbers that have remained static during the past decade. India鈥檚 share, however, has jumped from 4% to 7%.
Deepanshu Kumar can understand that. The undergrad at the Indian Institute of Technology in Delhi was disappointed by the H-1B news, but not distraught. He鈥檚 still in his teens, and he sees new opportunities emerging.
鈥淎fter all, it鈥檚 not only Indian professionals who were dependent on the U.S. job sector,鈥� he says. 鈥淭he reverse is also true. U.S. companies were equally dependent on us.鈥�
He doesn鈥檛 see that changing. What might change are the forms the relationship takes.
鈥淚n the longer run, I believe India is going to see more investments and people are going to get jobs within the country,鈥� he says. 鈥淭his could actually be an opportunity for us, if we handle it right.鈥�
鈥淭he question is how we position ourselves going forward,鈥� he adds. 鈥淒o we keep waiting for America to change its mind, or do we start building alternatives here?鈥�
