On Friday, US President Donald Trump announced that new H-1B visa applications will require a $1,00,000 payment.
Photo Credit: Reuters
OpenAI CEO Sam Altman is reportedly in favour of the fee hike for H-1B visa applications
On Friday, the non-immigrant Indian tech community in the US was thrown into chaos after the US President Donald Trump signed an executive order to add a $1,00,000 (roughly Rs. 89 lakh) fee for new H1-B visa applications. Even as the White House explained that it will be a one-time fee and not an annual subscription, the decision has rattled the tech corridors from Silicon Valley to Bengaluru, opening a fresh chapter in the global talent debate. While the US government maintains the decision will prioritise high-skill applicants, this is how Silicon Valley leaders have reacted.
The H-1B is a non-immigrant visa that US companies can apply for on behalf of their non-resident employees. It is a temporary visa that allows them to stay in the country and work for up to six years. This class of visa is typically reserved for skilled workers in the science, technology, engineering, and mathematics (STEM) and related fields. Currently, there is a cap of 85,000 on the visas that can be issued in a calendar year.
Typically, when applying for an H-1B visa, the employer has to pay a fee of $2,000 (roughly Rs. 1.7 lakh) to $3,000 (roughly Rs. 2.6 lakh). With the new rule, petitioners will have to pay $1,00,000 (roughly Rs. 89 lakh) per application, making it much more expensive to hire a non-US talent.
Additionally, the new rule also repurposes the wage level system. Divided into four categories, the system was earlier used as a compliance check to ensure employers were not underpaying employees. But now, a higher-paid worker in category IV will also get more entries in the approval process, making it easier for them to get the visa. On the other hand, entry-level workers will find it harder to secure an H-1B visa.
The new rule became effective starting September 21 and applies to all new petitions filed after that. The US government maintains that the decision was made to prioritise high-skill and higher-paid applicants and to reserve the lower-level jobs for US citizens.
According to Pew Research, 73 percent of the approved applicants in 2023 were born in India. Additionally, the majority of approvals each year since 2010 have gone to Indian workers. As a result, any barrier to new petitions disproportionately affects Indian professionals and Indian IT firms that rely on on-site staffing.
Soon after the new rule was made public, several company leaders and veterans in Silicon Valley have reacted to the developing situation. While some have called it a positive move, others have warned that this could lead to a loss of innovation in the US. Let us take a look at some of the statements made on the issue.
"We want all the brightest minds to come to the United States. Remember, immigration is the foundation of the American dream, and we represent the American dream. And so I think immigration is really important to our company and is really important to our nation's future, and I'm glad to see President Trump making the moves he's making,” Jensen Huang, CEO of Nvidia, told CNBC, maintaining a neutral stance.
“We need to get the smartest people in the country, and streamlining that process and also sort of outlining financial incentives seems good to me,” Sam Altman, CEO of OpenAI, told the publication.
Netflix Co-Founder Reed Hastings also responded favourably to the Trump administration's decision, noting in a post on X (formerly known as Twitter), “I've worked on H1-B politics for 30 years. Trump's $100k per year tax is a great solution. It will mean H1-B is used just for very high-value jobs, which will mean no lottery needed, and more certainty for those jobs.”
“That caught everyone off guard,” JPMorgan Chase CEO Jamie Dimon told CNBC-TV18 in an interview. He highlighted that he believed in a merit-based immigration policy and that he would beg President Trump to allow deserving individuals to work in the US. He also expected some pushback on the decision.
Venture capitalist and Shark Tank investor Kevin O'Leary said in a LinkedIn post, “I think what this does is hurt innovation long-term. I agree that it's going to push these really talented people into other countries. My attitude about this is if we educate you at MIT or at Harvard any school, we should give you a free ticket to stay here, get married, form a company, and build American businesses here. Why train them and kick them out?”
Royal Bank of Canada CEO Dave McKay called the decision a “material opportunity” for Canadian businesses. The country attracts a large number of foreign students to its universities for higher education; however, a large number of them move to the US after receiving their degree.
Addressing it, he told Bloomberg, “So from India or from South Asia or from Europe, they'll say, ‘Well, I can't get into the US, but I want to move to North America, I'll come to Canada.' All of that presents a material opportunity if the rules remain the same.”
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