US visa fee discriminatory, impacts Indian IT companies: Jaitley

Taking a strong stand over the visa fee hike, India’s Finance Minister Arun Jaitley termed it as “discriminatory” and underlined that this move by the US adversely impacts Indian IT companies and professionals. Mr Jaitley is in Washington DC on a week -ong visit from April 13 to attend the Spring Meetings of the International Monetary Fund (IMF) and the World Bank and other sessions. He is accompanied by RBI Governor Raghuram Rajan and Chief Economic Advisor Arvind Subramanian.

“India’s concern over the hike in the H-1B and L1 visa fee, which is discriminatory and in effect is largely targeted at Indian IT companies,” he said.

Congressional leaders have decided to impose a special fee of $4,000 on certain categories of H-1B visas and $4,500 on L-1 visas.

In a bilateral meeting with US Trade Representative Ambassador Michael Froman on April 14, Mr Jaitley also stressed on the need for early conclusion of Totalisation Agreement which would benefit Indians working in US. Due to the lack of a totalisation pact, it means that US workers working in India, too, are not permitted to claim their social security contributions when they leave. However, the problem is much bigger for India given the huge number of Indian working in the United States.

It is estimated that around $1 billion is deposited by Indian workers to the US social security system. India has been making a strong case for a totalisation agreement at meetings during high level visits.

Many of the high skilled workers stay in the US for a period of three to seven years and contribute about 15 per cent of their salary to the US social security system. As there is no totalisation pact in place, the workers lose the entire social security contributions unless they complete 10 years of mandatory contributions. India at present has 14 totalisation pacts with countries. Some of these include major countries such as Belgium, Germany and France and has recently also signed a social security agreement with Canada.

However, the US has been arguing that their social security system was not compatible with that of India. The social security system in India is administered by the Employees’ Provident Fund Organisation.

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