President Joe Biden takes over at a critical juncture for the world economy and America. Policy analysts and economists are busy debating what will be the direction for the Biden administration, will he take bold steps and undo the acrimonious policies and messaging of his predecessor or will the changes be more gradual and some hard to undo.
Immigration is one such issue which creates much emotion and always takes centre stage in the presidential elections. While it affects different interest groups, for India the debate is mainly about H-1B/L1 visa—a non-immigrant visa, meant for mobility of highly skilled individuals.
Over the years the debate for comprehensive immigration reforms continues to elude any legislative discussion. These reforms would address general immigration, families, highly skilled, temporary work permits, green cards, citizenship, etc. A divided House and Senate and many diverse political interests have prevented this in the past, leading to frequent tweaking of laws and extensive use of administrative orders to bypass the legislative process.
From India’s viewpoint, the tech sector has contributed significantly to its economy, simultaneously enhancing competitiveness of U.S. corporations. Mobility of highly skilled professionals across borders is important for a global delivery model. This movement is often misconstrued as immigration and misinterpreted as taking away U.S. jobs. Data shows that the U.S. unemployment rate almost doubled from 4.1% in January 2020 to 7.9% in September, while the unemployment rate in tech areas was hovering at 3%-3.5%. As recently as October 20, there were over 650,000 job vacancy postings.
Indian tech companies have made significant shifts in their business models over the last decade which have reduced their visa requirements. Through local hiring in key markets, academia, community engagement, and acquisitions, India-centric companies are evolving as global multinationals. The nature of work has changed and a majority of the repeatable jobs are getting automated. The focus is far more on agile adoption of new digital technologies to make their customers competitive. The pandemic accelerated “work from anywhere” which has become universally accepted and is also likely to change on-site requirements.
The success of innovation in the U.S. is widely attributed to its culture of diversity, ability to attract the best in the world, and focus on meritocracy. This is further evidenced by the fact that many large corporations such as Microsoft, Google, and Adobe, have Indian-born CEOs. Knowing how to tap foreign talent is a U.S. strength. But continued restrictions on skilled talent mobility is hurting the competitiveness of U.S. companies.
The recent negative signals given by the Trump administration have led to foreign students preferring other destinations, thereby depriving the U.S. from accessing this talent. The per country cap on green cards has created issues for some of the brightest having to leave the U.S. due to the prolonged uncertainty. Green cards will hopefully be a priority item in both the Biden administration and Congress. In fact, the bill to lift the per-country cap on green cards was co-introduced by Vice President Kamala Harris and almost got passed in the last session.
The Biden administration has announced its intent to invest “significant political capital” in reforming the nation’s immigration policies to create a welcoming environment and stimulate economic growth. Through its initiatives to attract the “best and brightest” applicants to the U.S., the Biden administration can expand the country’s economy, make the U.S. more competitive in global markets, and incentivise foreign talent to seek employment in the U.S.
The success of innovation in the U.S. is widely attributed to its culture of diversity, ability to attract the best in the world, and focus on meritocracy. This is further evidenced by the fact that many large corporations such as Microsoft, Google, and Adobe, have Indian-born CEOs. Knowing how to tap foreign talent is a U.S. strength. But continued restrictions on skilled talent mobility is hurting the competitiveness of U.S. companies.
It is believed that China, over the last five years, has made tremendous progress and, in fact, leads in deployment of digital technologies. The U.S. could lose its edge in technology if access to highly skilled resources in new technologies is restricted.
The new administration understands this and may be much more favourably inclined towards immigration and undo irritants like the executive order banning the entry of H-1B visa holders, restrictions on working of spouses, increase in fees, unnecessary scrutiny and delays, etc. Many of the key players on immigration and trade in the Biden administration are likely to be old hands who had served under Barack Obama and understand the importance of these changes.
However, we need to be cautious in our expectations. Covid-19, a large debt, distress in several sectors, Big Tech policies, and other priorities will need to be tackled on a war footing. Moreover, Democrats have always focussed more on labour rights, position of unions, climate change, issues of human rights, etc. and these will start getting attention. The dynamics of the Congress will also need to be watched, particularly those members who haven’t changed their stance on mobility of highly-skilled talent.
Indo-U.S. bilateral engagement has continued to strengthen over the last few years and the Indian government will be putting in place its strategy on strengthening this engagement. We cannot, however, take the Biden administration’s favourable disposition on India for granted. Indian policymakers, trade associations, and industry will have to reposition the country’s stance on several issues. This will mean a bit of give and take which, hopefully, is already in the works.
Views are personal. The author is former president and chairman, Nasscom.
(The story originally appeared in Fortune India's February 2021 issue).