Trump admin calls H-1B visa 'a scam', signals overhaul: Here's how it may impact Indians

US Commerce Secretary Howard Lutnick

In a signal that the Donald Trump administration is planning a significant overhaul of the popular H-1B visa program, US Commerce Secretary Howard Lutnick recently said that hiring American workers should be the "priority" of all great American businesses.

In an interview to Fox News, Lutnick called the H-1B visa program a "scam" that allows foreign workers to take American job opportunities.

“The current H-1B visa system is a scam that lets foreign workers fill American job opportunities. Hiring American workers should be the priority of all great American businesses," Lutnick said, in one of the harshest criticisms of the program used extensively by US tech firms to hire foreign workers from countries like India.

The commerce secretary also questioned the economic rationale behind current green card allocations. “We give green cards. The average American makes $75,000 a year and the average green card recipient $66,000 a year. Why are we doing that? It’s like picking the bottom core," he explained.

The remarks underpinned a conscious push by the Trump administration to tighten US immigration rules and reshape the H-1B system.

Lutnick confirmed that he had been directly involved in the plan to eliminate the existing lottery-based allocation of H-1B visas and replace it with a wage-driven model.

“We’re going to change that programme because that’s terrible. We’re going to change the green card," he said, adding, “That’s the gold card that’s coming. And that’s we’re gonna start picking the best people to come into this country. It’s time for that to change."

The Trump administration had already signaled a significant overhaul of the visa program, with officials confirming in July that plans are underway to scrap the annual lottery.

Under the new framework, US would prioritize higher-paid and highly skilled applicants for the limited annual quota of 65,000 regular and 20,000 advanced degree H-1Bs. In short, the H-1B visas would be issued on the bases of salaries offered to applicatns, starting with the highest.

The White House argues the move will protect American workers and prevent companies from replacing them with lower-cost foreign employees.

Lutnick and President Trump have repeatedly stressed the need to attract “the best and the brightest,” rejecting the current random lottery as inadequate.

At the same time, critics, including sections of US industry, warn that the wage-first system would disadvantage startups, small firms and international graduates.

Elon Musk and other high-profile business leaders have defended the contribution of H-1B workers to American innovation.

During Trump’s first term, denial rates for H-1B applications rose sharply as his administration tightened scrutiny, restricted entry-level roles and imposed more frequent compliance checks. The revival of those measures, combined with new wage-based rules, signals a return to hardline immigration enforcement.

For India, which accounts for over 70 percent of H-1B recipients, the impact of an overhaul could be severe.

Analysts warn that limiting visas to only the highest-paid applicants could prompt US firms to expand offshore operations in India or lean more heavily on remote work.

While top-paid Indians may still secure visas, mid-level workers, fresh graduates and those employed by smaller firms will find it much tougher to qualify.

The administration’s parallel push for a “Gold Card” residency scheme for wealthy investors also signals a broader shift towards investment- and skill-based migration, potentially sidelining traditional pathways like the H-1B.

For Indian students and professionals, a revamped system would mean fewer opportunities to work and settle in US.