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BUSINESS

US tells India it is mulling caps on H-1B visas to

deter data rules: report
Two senior Indian government o cials said on Wednesday they were briefed last week on a
US government plan to cap H-1B visas issued each year to Indians at between 10% and 15% of
the annual quota.
By Reuters | • New Delhi |
Updated: June 20, 2019 7:17:38 am
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Most affected by any such caps would be India’s more than $ 150 billion IT sector.

The United States has told India it is considering caps on H-1B work visas for nations that force
foreign companies to store data locally, three sources with knowledge of the matter told
Reuters, widening the two countries’ row over tariffs and trade.
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1Insolvency: NCLT to hear 3 pleas against Jet Airways today

The 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

2
Pompeo’s visit to
Sinha panel forNew Delhi.cap on collateral-free loans to MSMEs
doubling

India, which has upset companies such as Mastercard and irked the US government with
stringent new rules on data storage, is the largest recipient of these temporary visas, most of
3ED arrests 2 former IL&FS executives in PMLA probe
them to workers at big Indian technology rms.
The warning comes as trade tensions between the United States and India have resulted in tit-
for-tat tariff actions in recent weeks. From Sunday, India imposed higher tariffs on some US
goods, days after Washington withdrew a key trade privilege for New Delhi.

Two senior Indian government o cials said on Wednesday they were briefed last week on a US
government plan to cap H-1B visas issued each year to Indians at between 10% and 15% of the
annual quota. There is no current country-speci c limit on the 85,000 H-1B work visas granted
each year, and an estimated 70% go to Indians.

Both o cials said they were told the plan was linked to the global push for “data localisation”,
in which a country places restrictions on data as a way to gain better control over it and
potentially curb the power of international companies. US rms have lobbied hard against data
localisation rules around the world.

A Washington-based industry source aware of India-US negotiations also said the United States
was deliberating capping the number of H-1B visas in response to global data storage rules.
The move, however, was not solely targeted at India, the source said.

“The proposal is that any country that does data localisation, then it (H-1B visas) would be
limited to about 15% of the quota. It’s being discussed internally in the US government,” the
person said.

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NEXT STORIES US tells India it is mulling caps on H-1B visas to deter data rules

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2
Maharashtra:
Sinha panel for doubling cap on Zero
collateral-free rabi
loans to crop,
MSMEs bone dry wells, hunger strikes in
despair

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ED arrests 2 former IL&FS executives in PMLA probe
The US Embassy in New Delhi did not respond to a request for comment. A spokeswoman for
the US Trade Representative’s o ce (USTR) referred questions to the State Department, which
did not immediately respond to a request for comment.

IT sector 

Most affected by any such caps would be India’s more than $150 billion IT sector, including
Tata Consultancy Services and Infosys Ltd, which uses H-1B visas to y engineers and
developers to service clients in the United States, its biggest market. Major Silicon Valley tech
companies also hire workers using the visas.

Stratfor analyst Reva Goujon on Twitter called the move “potentially another big blow to the US
#tech industry amid US-#China economic battle,” a sentiment echoed on social media by some
Indians and their supporters.

India’s Ministry of External Affairs has sought an “urgent response” from o cials on how such
a move by the United States could affect India, said one of the two government o cials, who
declined to be named due to the sensitivity of the matter.

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India’s Ministry of External Affairs, as well as the commerce department that is typically

1Insolvency: NCLT to hear 3 pleas against Jet Airways today

involved in such discussions, did not respond to an e-mail seeking comment.

Since last year, the Trump administration has been upset that US companies such as

2
Sinha panel
Mastercard andfor doubling
Visa suffer cap
dueon
tocollateral-free
regulations inloans to MSMEs
several countries that it says are protectionist
and increasingly require companies to store more data locally.

3
IndiaED
last year 2mandated
arrests foreign
former IL&FS rms in
executives to PMLA
store probe
their payments data “only in India” for
supervision, and New Delhi is working on a broad data protection law that would impose strict
rules for local processing of data it considers sensitive.

While governments the world over have been announcing stricter data storage rules to better
access data in their jurisdictions, critics say restricting cross-border data ows hurts innovation
and raises companies’ costs.

In March the USTR, in a press note https://bit.ly/2YSeQfN, highlighted “key barriers to digital
trade”, citing data- ow restrictions in India, China, Indonesia and Vietnam, among others.

At a US-India Business Council event last week, Pompeo said the Trump administration would
push for free ow of data across borders, not just to help US companies but also to secure
consumers’ privacy.

10 Comment(s)

US H1-B visa

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