India to engage US at WTO on restrictions on IT professionals

11 May 2016

India and the United states will engage in consultations on removing the recent US trade restrictive measures, which impair the ability of both US-based Indian companies and Indian professionals to supply services in the US.

An official release today said the two sides will have consultations at the WTO on restrictive tax impost by the US administration on engaging Indian professionals by US-based Indian companies on 11 and 12 May 2016.

''India hopes that the United States will constructively engage with India to address its concerns regarding recent US measures which impair the ability of both US based Indian companies and Indian professionals to supply services in the US,'' the release stated.

The H-1B and L-1 categories of non-immigrants, for which there has been a significant fee hike, correspond with the categories of specialists and intra-corporate transferees, both of which are part of US' commitments under the WTO's General Agreement on Trade in Services. These are also the same categories that are most extensively used by Indian service suppliers, especially in the IT sector, supplying services in the US, the release pointed out.

''India and the US share a mutually inter-dependent and beneficial relationship in trade in services, which is well-documented. While the US accounts for close to 60 per cent of software exports from India, Indian IT professionals have had a positive role in contributing to the competitiveness of the US economy. The increasing volume of services trade has contributed to significant economic growth as well as creation of employment opportunities within the U. The situation therefore presents a win-win relationship for both nations.''

The release said the US fee hike measures for the H-1B and L-1 categories are not only adversely affecting the competitiveness of India's services industry engaged in the US market, but also creating uncertainties for Indian service suppliers. They also run counter to the basic principles of a transparent and predictable trading environment, which lies at the very heart of the WTO agreements.

India is hopeful that deliberations during the WTO consultations shall be constructive and it would result in removal of these trade restrictive measures, the release added.

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