US President Donald Trump banned non-immigrant visas such as H-1B and L-1 till December in an executive order on June 22 (local time). In the order, Trump also extended the ban for issuance of Green Cards till the end of 2020.
This would impact H-1B, H-2, L-1, J visa holders. However, students and optional training programmes, which foreign students can avail after graduation, remain unaffected.
What does the new order say?
The proclamation bans the entry of foreign nationals, including Indians, through skilled worker visas such as H-1B, L-1/L-2, unskilled temporary worker visa H-2B and J visa reserved for scholars, professors and exchange students.
The ban will be effective from June 24 to December 31. This is also applicable for the immigrant visas that are initially banned for 60 days.
Watch: H-1B visa ban | What does it mean for India?
What is the need for this order?
The objective is to improve unemployment in the US, which now stands at 40 million.
In the proclamation, Trump said, “Between February and April of 2020, more than 17 million United States jobs were lost in industries in which employers are seeking to fill worker positions tied to H-2B nonimmigrant visas.”
The order further added that during this same period, more than 20 million United States workers lost their jobs in key industries where employers are currently requesting H-1B and L workers to fill positions.
“The entry of additional workers through the H-1B, H-2B, J, and L nonimmigrant visa programs, therefore, presents a significant threat to employment opportunities for Americans affected by the extraordinary economic disruptions caused by the COVID-19 outbreak,” he added.
Also Read: Prolonged ban of H-1B visa may change IT, tech ecosystem in US
Who is impacted?
The order will not impact those who are already in the US with the valid non-immigration visa and those already in the US.
However it will impact foreign nationals, including Indians, who are applying for a fresh visa. It will also affect those in India with valid skilled worker visas such as H-1B, L-1/L-2 as they will not be allowed entry into the US till the ban is in place.
In terms of Green Cards, this is unlikely to impact those in the US and will affect those applying for Green Cards from outside the country.
Are there any exemptions?
Yes, people who are in essential services in the US will be exempted.
As per the order, this will not affect those who enter the country to provide temporary labour or services essential to the United States food supply chain. The order further states that those whose entry would be in the national interest as determined by the Secretary of State, the Secretary of Homeland Security, or their respective designees.
Also Read: H-1B visas: India tops list of registrants
So, what about the tech sector?
There is no explicit mention of tech workers though the order has stated that those in the “national interest” determined by the respective authorities will be allowed. It is unclear if this would include the tech workforce.
In an earlier interaction with Moneycontrol, Shivendra Singh, Vice President and Head - Global Trade Development, NASSCOM, said that tech workers in critical functions should be considered as essential service given that these employees power critical infrastructure such as hospitals in the US.
So how will it impact India?
This will have a significant impact on Indians given that we are the biggest beneficiaries of the visa. There are about four lakh H-1B and one lakh L-1 Indian visa holders in the US employed in several tech and IT firms.
A Kotak Institutional Securities report said that a ban of H-1B and L-1 visas beyond September will affect the talent supply chain of the IT companies even if the companies have increased their localisation in the US, which is more than 50 percent.
Companies such as TCS, Infosys, Wipro and Cognizant are the biggest beneficiaries of the visa along with the US tech firms such as Google, Facebook and Amazon.
Prolonged ban will have an impact on the tech supply chain in the US as these companies will not have the ability to move resources at the back of the ban. This will also impact the fresh application of visa and also those with valid visa travelling to the US.Click here for our entire coverage of the H-1B visa ban