Statement from Som Mittal, President of NASSCOM, the High Tech Association of India

WASHINGTON, Aug. 6 /PRNewswire-USNewswire/ -- The U.S. Senate recently passed legislation to increase funding for U.S. border security efforts. The money to pay for this increase would come primarily from raising fees on H-1B and L-1 visas for highly skilled workers. While we understand the need for heightened border security, we believe that the extra fees will produce negative consequences for both U.S. and Indian companies.

Indian companies use only a fraction (less than 12%) of the total number of H-1B visas issued each year. But U.S. companies, which use the bulk of these visas, would remain unaffected by the legislation. This is simply unfair to foreign companies.

In addition, the higher fees will have a negative impact on the substantial investment that Indian companies have been making in the U.S., will reduce the number of Americans that Indian companies employ and will lead to an increase in the off-shoring of technology endeavors that would have otherwise occurred in the U.S. The legislation sends the message that foreign workers are not welcome.

Indian firms and Indian citizens pay in excess of $1 billion a year to the U.S. in the form of Social Security taxes with no benefit or refund. Much of that revenue will be lost to the U.S. Treasury if this bill becomes law.

The bill is also an indirect form of protectionism and runs contrary to the Obama administration's oft-repeated goal of opening markets and doubling U.S. exports. The adoption of these provisions by the U.S. hinders the free movement of people essential to the promotion of free trade. The legislation will also lead to diminished inflow of Indian talent to the U.S., which helps to drive U.S. tech innovation and to spur the U.S. economic recovery.

What's more, provisions like these are contrary to the spirit and rules of the World Trade Organization and the General Agreement on Trade in Services.

While the full details of implementation are not available, we estimate the impact on Indian companies could be as high as $200 million to $250 million dollars per year.

We are working with the government of India to protest this legislation and we hope that the U.S. will reconsider the bill for the sake of international trade and economic recovery.

Statement from Som Mittal, President of NASSCOM, the High Tech Association of India

SOURCE NASSCOM, Delhi