Trump’s H-1B Reforms: India’s Opportunity to Strengthen Atmanirbhar Bharat

A recent report by the State Bank of India (SBI) suggests that potential H-1B visa restrictions under US President-elect Donald Trump could have a silver lining for India, particularly under Prime Minister Narendra Modi’s Atmanirbhar Bharat, or “self-reliant India,” initiative. While stricter visa rules could heighten costs for Indian IT firms in the US, the report envisions a long-term benefit for India’s local economy, pushing for growth in domestic production and self-sufficiency.

H-1B Visa Programme: A Gateway for Indian IT Talent

The H-1B visa programme allows American companies to hire skilled foreign professionals for specialized roles that require specific expertise. According to the US Department of Labour, this visa was designed to bridge the skill gap when qualified US-based workers are unavailable.

Each year, 65,000 H-1B visas are issued, along with an additional 20,000 set aside for individuals holding an advanced degree from a US institution. While many sectors benefit from H-1B visas, the Indian IT industry—often leading in computer-related occupations—constitutes the largest share of recipients.

Data from the US Citizenship and Immigration Services (USCIS) shows that in 2023, 72.3% of H-1B visas went to Indian nationals, primarily for roles in technology, engineering, and architecture. Despite contributing highly skilled talent, the programme has frequently come under scrutiny in US political circles, particularly regarding its impact on American job opportunities.

Trump’s History with H-1B and Potential Impact on Indian Companies

During his previous term, Trump criticized the H-1B programme, arguing that it reduced employment opportunities for Americans. His administration’s policies led to an increase in visa rejections, creating significant challenges for Indian IT firms dependent on these visas to maintain their US operations. A controversial proposal to raise minimum wages for H-1B holders was also introduced but later blocked in court.

With Trump’s anticipated focus on prioritizing American jobs, the SBI report forecasts additional hurdles for Indian companies. “Stricter H-1B rules may increase costs for Indian IT companies in the US, potentially reducing labour mobility and pressuring these firms to hire locally at higher costs,” the report noted. This could ultimately reduce the number of Indians working in the US, encouraging Indian firms to shift focus towards domestic opportunities and talent development.

Modi’s Atmanirbhar Bharat Initiative: A Path to Self-Reliance

Prime Minister Narendra Modi’s Atmanirbhar Bharat mission aligns closely with the potential shifts in the US H-1B landscape. Aimed at promoting self-sufficiency, this initiative encourages local production, increased exports, and a boost in foreign investments within India. With Trump’s H-1B restrictions, Indian firms could be incentivized to focus on expanding within the Indian market rather than relying on overseas business.

The SBI report supports this view, stating, “As the US moves to protect its own workforce, India may see an opportunity to reinforce its domestic production capabilities and make inward investment more attractive.” In this context, Modi’s policy could gain traction as Indian firms consider investing in domestic training, local hiring, and upskilling programs to offset potential US visa limitations.

The Immigration Perspective: Opportunities and Challenges

Ajay Sharma, an immigration expert and founder of Abhinav Immigration Services, points out that Trump’s immigration policies may open new doors for skilled Indian professionals. “Trump’s platform focused on deporting illegal migrants, which could lead to more pathways for skilled legal migrants,” Sharma remarked. He highlighted the potential for Trump’s administration to emphasize a merit-based immigration system, which could create opportunities for Indians who come through legal routes like H-1B or F-1 visas for study.

Previously, Trump indicated interest in a points-based immigration system, similar to Canada’s or Australia’s, that would favor skilled migrants. “If the US moves toward a skills-based approach, it could increase prospects for Indian migrants,” Sharma added. By shifting focus to skilled over family-based immigration, Indian professionals, particularly in IT and tech fields, may find new entryways into the US market.

India’s Response to Potential H-1B Changes

With Indians consistently leading in H-1B visa numbers, any shift in the US visa landscape could have ripple effects on India’s tech ecosystem. In the financial year 2023, for example, nearly 65% of H-1B visas went to computer-related roles, with Indian workers holding a significant share. With median salaries for H-1B holders around $118,000, this programme has been crucial for many Indian tech professionals and businesses.

However, as India’s economy grows and as policies like Atmanirbhar Bharat gain momentum, the country may increasingly support its own IT ecosystem, offering viable domestic alternatives. Indian companies may look to develop technology clusters, improve infrastructure, and tap into the country’s talent pool, reducing reliance on overseas markets and promoting local industry.

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