Visa hikes: Is brand America losing its shine for Indian travellers?

India America flag AFP file photo

For decades, the US has been the ultimate dream destination for Indian travellers — whether for work, study, or leisure. But soaring visa fees are testing that loyalty. With costs climbing steeply, questions are being raised on whether brand America is beginning to lose its sheen among Indians, many of whom are weighing other, more affordable global destinations.

What's driving the news?

US President Trump's new rule has raised the H-1B visa application fee from $1,000 to $100,000, sending shockwaves among Indians, the biggest beneficiaries of the programme. The one-time fee for new applications kicks in from the next lottery cycle (March–April 2026) and is not for renewals.

This visa hike comes after the increase in fees for Indians applying for the US visa for tourism, study, or work. Under the 'Big Beautiful Bill' signed on July 4, Trump had introduced a new 'Visa Integrity Fee' of $250 for most non-immigrant visa categories. A typical tourist visa, which used to cost around Rs 16,000, has become more expensive by around Rs 22,000, taking the cost to Rs 38,000.

Is the visa fees hike affecting brand America?

There is anti-US sentiment amid Indian travellers and it is not just from work perspective but also  amid leisure travellers and I see brand America taking a hit, Govind Gaur, Founder and CEO (Chief Executive Officer), WanderOn, D2C (Direct to Consumer) travel tech company, told Moneycontrol.

He added that a lot of people travel back home (India) and many of them go to the US to celebrate Christmas and New Year. For them, travel might be affected. "There is also a lot of uncertainty for Indians living in the US due to the recent changes in visa fees and rules."

Gaur pointed out that due to the visa fees hike a lot of trips to the US were advanced to avoid paying the extra fees. "It is both a panic situation and a chaos due to the recent changes in visa fees and rules."

Over the last year, there has been a slowdown in demand for the US, with monthly arrivals dipping anywhere between 8–15 percent compared to the previous year, said Hari Ganapathy, Co-Founder, Pickyourtrail, a travel agency. "With visa fees now moving up so steeply, this trend could accelerate."

He added, "For many travellers, the decision often sounds like: Should I do my holiday in the US this year, or go to Europe or Southeast Asia instead?"

With the added cost and processing challenges, we are seeing more people lean towards destinations that feel simpler and more affordable, he added.

The recent news around visa fee hikes in the US has raised questions among travellers, and we are seeing that reflected in the kinds of queries we receive, said Mohak Nahta, CEO and Founder of Atlys, an online visa platform.

"Some are choosing to apply sooner to avoid additional costs, while others are waiting to see how the changes unfold. It is still early to measure the full impact. Some may reconsider their plans due to the higher visa cost. There may be some impact on travellers who are more price-sensitive," he added.

On the other hand, Nahta added that current indicators suggest demand for the US remains resilient.

Ganapathy also expects that the US will continue to attract Indians visiting family, studying, or looking for aspirational experiences. "But if the current environment continues, leisure demand could soften further, and we may see the declines we have tracked this year deepen in the coming seasons.”

Is America losing its sheen amid Indians?

The number of Indian travelers visiting the United States declined by 8 percent to 2.1 lakh Indians in June 2025 from 2.3 lakh in June 2024, a drop seen for the first time since 2001—excluding pandemic disruptions. The US National Travel and Tourism Office (NTTO) Preliminary data further shows that Indians visiting the US may further decline by 5.5 percent in July.

Stricter visa processing, higher airfares, global economic uncertainty, and political factors are some of the reasons for the drop in tourist arrivals from India to the US.

The US continues to be a top destination for Indian travelers, particularly for educational and family visits, but factors like visa processing and fees hike have begun to influence travel decisions.

Despite the robust Indian diaspora of over 50 lakh in the US, it could not offset the decrease in arrivals.

In addition, the decline in Indians visiting the US is part of a broader slowdown in international arrivals to the US, which fell 6.2 percent in June 2025, following similar drops in previous months.

Why does it matter?

India ranks as the fourth-largest source market for the US and the second-largest overseas long-haul market after the UK. Indian travelers have fueled steady growth for US tourism for more than two decades. Students, professionals, and families form the bulk of visitors, drawn to academic hubs, business centers, and iconic tourist destinations like New York, California, Florida, and Nevada.

India is one of the fastest growing markets in the world, Brand USA CEO Fred Dixon had said during his India visit in January this year. Brand USA is the destination marketing organisation for the United States. Dixon had also pointed out that Indian travellers contributed $20 billion to the US economy in 2023.

While the uncertainty around travel to the US is affecting the mindset of Indian travellers, Nahta said that they are not yet seeing a major shift in demand for US travel for Christmas and New Year. "These trips are generally planned and budgeted well in advance, so cancellations seem unlikely."

Where are Indians going if not the US?

Gaur pointed out that other international destinations are being preferred more over the US due to the uncertainty around travel to the US.

UK, Europe is more on the minds of Indian travellers along with Southeast Asia, Japan and South Korea also seeing massive advantages.

Nahta on the other hand expects the US growth story to continue while he sees Indians also giving more preference to foreign destinations like Europe which remain top choices for winter travel among luxury holidaymakers and long-haul tourists.

"At the same time, we also see strong demand for destinations like the UAE and parts of Southeast Asia, which are convenient and accessible," he said.