When the S386 bill, which eliminates the per-country cap for employment-based green cards, was passed in the U.S. Senate, it was expected that the Indian community, who have been waiting in the green card queue for decades, would benefit.
This has led these Indians, who have invested anywhere between $500,000 and $1 million or more, to lobby for getting the EB-5 visa out of the S386 bill.
What is happening?
For Indians it was attractive, given that the time period to get an EB-5 is 4-5 years compared to 80 years for an H-1B or L-1 visa, which come under EB-2/EB-3 category. This led to many Indians taking the EB-5 route over the last few years. India reached its cap in FY19.
According to a report by Invest in the USA, a trade organisation, there are estimated to be 5,700 EB-5 applicants with petitions at the National Visa Centre and Unites States Citizenship and Immigration Services (USCIS) as of October 1, 2020.
Deepak (name changed), a techie and an EB-5 investor, has put all his life savings into EB-5 to get a green card for his family. It was a risk, given that he is the only earning member and also has an educational loan to pay off on top of the $500,000 investment he made.
People like Deepak would now be at a disadvantage under the current structure of the S386 bill where applicants would be cleared under a first-come first-served basis. This could be to the detriment of people like Deepak if there are a large number of EB-5 applicants, which will lengthen the wait time for visa approvals.
Mark Davies, Global Chairman, Davies & Associates, said, “The existing country caps are actually working to the advantage of Indians in the EB-5 Investor visa program by keeping them ahead of a long backlog of Chinese applicants.”
“Indians are now the largest applicant group for EB-5 visas and the proposed change would suddenly place these people in a queue behind thousands of Chinese applicants overnight,” he added. Chinese applicants have a wait time of close to 17 years based on their current backlog.
Currently, Indians are the largest EB-5 investors, accounting for about 44.3 percent, followed by Chinese at 36.9 percent. Most of the Indians became investors over the last few years compared to Chinese. EB-5 filings saw a surge from Chinese in 2014-17, immigration experts pointed out.
Pankaj Joshi, managing director, Nysa Global, explained that if the bill is implemented, Indians who did not have the wait period earlier, will now have to wait to get their green card.
It is not clear yet how long the wait for existing investors like Deepak will be, since it would depend on how many Chinese investors have filed before them.
But new investors will have to wait for 8-9 years instead of an average four-year wait now, pointed out immigration experts.
Though it might appear as a short time compared to the longer wait period in EB-2/EB-3 category, under which the majority of H-1B visa holders falls, there are a lot of risks involved, said investors.
There are two key risks the investors might run into.
One. Longer the investment, higher the risk given the uncertainty around them. Saran (name changed), a techie in the US, had invested in a hotel project in New York under EB-5 in 2018. On the back of COVID-19 crisis, the hotel industry was one of the worst hit. “Though I am positive that things would be better in coming months, ambiguity remains,” he added.
Saran is among the dozens of investors, who have invested in various projects. Given that the investment is directly linked to the visa, if the project goes bust, the EB-5 application is rejected as well, especially if they are in the initial stages of processing.
Two. This means that they not only lose the chance to get their green card, there is a possibility of losing the money too. For new investors, who would need to pay $900,000 to $1.8 million depending on the nature and region of investment, there is a lot at stake. The new investment amount came into effect in November 2019 and was increased from the earlier range of $500,000 to $1 million.
So what now?
With increased wait periods and large investment amounts, the US might no longer be attractive for many.
Joshi pointed out that many would move to countries like Canada, Ireland, Portugal and the UK, where processing time for investor visas is anywhere between 3-9 months, much less than the average 4 years in the US.
For those who have already invested, lobbying is the only option. Saran explained that there are close to 100 investors in their group, who are reaching out to Senators and local Congressmen, through calls, voice messages, emails and tweets.
The bill is not final yet and there is not much clarity on what changes the House of Representatives would bring. “So we also don’t know what to lobby for,” quipped Saran. So most of the investors are lobbying against the inclusion of EB-5 in the bill, he added.
“We are also talking to their (Congressmen) assistants and sending letters to our Senators to cut EB-5 out of S386,” Saran added.