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What is the News?
In 2020 the US President imposed a ban on H-1B visa. The current US President decided to reverse the ban. So he allows a 2020 ban to expire on March 31st.
About the 2020 Ban on H1-B skilled workers:
- In 2020, the previous US President signed an executive order suspending the entry of H-1B and other foreign work visa holders.
- This decision was to protect the American jobs after the Covid-19 pandemic impacts. However, the ban did not have its intended impact.
Why did the President then let the executive order expire?
- Though the H-1B visa allows cheap labour in the US, they are beneficial to US companies. It is helpful in getting inexpensive but highly skilled and trained workers.
- Hence, the US President has decided to reverse the ban to allow companies to hire new workers.
Impact of this decision on the Indian IT industry:
- The US government has a cap of 85,000 total H-1B visas for each year.
- Among these, 65,000 H-1B visas are issued to highly skilled foreign workers. The rest 20,000 can be additionally allotted to highly skilled foreign workers having a higher education or master’s degree from a US university.
- Indian IT companies are among the biggest beneficiaries of the US H-1B visa regime. Since the 1990s they have the highest share in the total number of visas issued each year.
- Hence, this decision will mean the availability of a greater workforce for the IT companies.
About H-1B visa:
- H1-B is a non-immigrant visa. It allows US companies to employ foreign workers on the basis of theoretical or technical expertise.
- H-1B visas are generally approved for a period of three years for a person. But many visa holders change employers to extend their US stay.
- Further, most IT companies in the US hire from the pool of H 1B visa-approved workers. As they are already present in the US to keep their costs in check. Such workers are often hired by the companies as subcontractors.
Source: The Hindu