According to Nasscom the US government's move to hike visa fees will significantly increase costs for Indian IT firms. Its estimate is based on the assumption that the increase is $4,500 (on top of the existing fee of $2,500 for H1 visas) and the fact that around 50,000 H1 and L1 visas a year are used by the industry every year.
However, Nasscom admits that the bill is worded in ambiguous language on the quantum of fee increase.
The fees are typically split into what are known as filing fees and fraud fees and the industry body says it remains unclear where there would be an increase of increase of $2,250 in both filing fees and fraud fees or whether $2250 would be the combined impact.
In any case the impact is expected to be substantial.
The bill is also seen to render Indian IT companies less competitive as against their US counterparts like IBM, Accenture and HP. Under the bill's provisions, the higher fees would apply only to companies that employ 50 or more people in the US and only if more than 50 per cent of that company's employees are under H-1B or L-1 status.
For US MNCs, only a tiny fraction of their employees are under these visas while most of the bigger Indian IT companies have well over 50 per cent of their employees in the US under these visas, though most are in the process of increasing their local employee base.
''While we understand the need for the US to protect its southwest borders, it seems that the funding proposed by this bill would be from the Indian IT sector,'' Nasscom said in a statement.