The United States has told India it is considering caps on H-1B work visas for nations that force foreign companies to store data locally, three sources with knowledge of the matter told Reuters, widening the two countries’ row over tariffs and trade.
The plan to restrict the popular H-1B visa programme, under which skilled foreign workers are brought to the US each year, comes days ahead of US Secretary of State Mike Pompeo’s visit to New Delhi.
The warning comes as trade tensions between the US and India have resulted in tit-for-tat tariff actions in recent weeks. From Sunday, India imposed higher tariffs on some US goods, days after Washington withdrew a key trade privilege for New Delhi.
IT sector to be hit hard
Most-affected by any such caps would be India’s more than $150 billion IT sector, led by Tata Consultancy Services and Infosys Ltd, which uses H-1B visas to fly engineers and developers to service clients in the United States, their biggest market.
Accordign to News18, The Ministry of External Affairs has sought an “urgent response” from officials on how such a move by the US could affect India, said one of the two government officials, who declined to be named due to the sensitivity of the matter.
The Ministry of External Affairs, as well as the commerce department typically involved in such discussions, did not respond to an email seeking comment.