Is H1B Visa Reform an Immigration Issue or a Trade Issue?

The increasing number of US administrative measures that affect the H1B visa program, have fueled the international debate about the role of the popular non-immigrant work permit for foreign workers.  At the heart of the debate is the issue of whether the H1B visa is actually a trade issue with some countries and its citizens that rely on the program, rather than a simple immigration issue.

Here are the two sides to the debate:

  • The Immigration Argument

The traditional view is that immigration and issuance of visas is only subject to internal government law and policy.  Each country has sole authority to decide who may visit, work or live in the country.  There is no international rule or treaty that gives foreign citizens the right to enter other countries without a visa, or to work without immigration approval.

Countries or regions can create treaties that grant special immigration status to citizens of those countries, such as the right to travel and work policy in the European Union.  Member states agree to grant these special privileges to each other to facilitate their economic growth and access to a broader work population, with certain limitations.

H1B Debate: The US View

The US administration has taken the stance that the H1B visa has been misused, and is actually displacing US citizens from their jobs.  Therefore, rules and regulations are being tightened to limit the number and type of jobs offered to foreign workers.  The government’s attitude is that it has the right to limit non-immigrant work visas as it chooses, despite the impact on the foreign workers or their country of residence.

  • The Trade Issue

The contrasting point of view when it comes to work visas is that they should be seen as a trade issue between one or more countries.  This side of the debate would claim that a country’s citizens offering work skills are actually a ‘commodity’, which both countries have agreed to exchange along with other commodities or products.

As such, the foreign workers would be characterized as an element of trade, with some other equivalent trade value for each country.  In some cases, this could be explicit, or may be implied based on some historical practices or policy.

H1B Debate: The Indian View

This is the exact stance that India is taking with the reform of the H1B visa program.  Due to the fact that over 70% of all H1B visas are given to Indian IT workers, India claims that their workers in the US are a part of US-India trade relations and agreements.  By curtailing a large percentage of those workers, the US will be undermining a network of trade agreements that both countries rely upon.

This is not just rhetoric by the Indian government, since nearly $10 billion per year is remitted to India by its workers in the US.  In addition, Indian workers gain valuable skills and experience which they can then ‘import’ back home when their visa expires.

In exchange, India is the largest buyer of US military arms and aircraft (one recent order for Boeing of $22 billion), which US companies profit from.  So, this does underscore how important it is for two countries to maintain some equality in their trade agreements to prevent conflict or economic disruption.

What is the Correct Point of View?

Regardless of policy arguments, there could be an economic impact for both the US and India as H1B visa reform continues.  It is conceivable that India could retaliate by reducing its trade volume with the US, or turn to other trading partners.  In turn, US companies could lose out on essential technical skills from Indian workers, that could undermine their products and services.

Feel free to share your opinion about this issue in the comments section, and how you think this issue could be resolved between the US and India in the future.

  • February 22nd, 2018
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