H1-B visa row: US officials start damage control

Well aware that the visa row could have a direct impact on the fast growing economic ties with India, the Obama Administration has swung into action to initiate talks with the leaders at the Capitol Hill and the business community over the issue.

But there is no unanimity within the Obama Administration on this issue that has the potential to jeopardise the Indo-US business ties, officials privy to the discussion said.

"This is an issue that we have had conversations with leaders on the Hill about. We've also had conversations across the government and we are listening to the concerns that business leaders have indicated and will be continuing our dialogue on this issue," State Department spokesman P J Crowley said.

Corporate America had warned that the passage of the Border Security Bill, which seeks to fund enhanced security measures along the US-Mexico border by raising fees for certain category of visas, would undermine the growing economic relationship between the two countries.

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A senior Obama Administration official noted that this is "not a done deal yet" and the government is looking at it in depth to resolve the issue by talking with the leaders of the Congress, the business community and those within the government.

"There may be varying views about this within the government. We have to decide what our position is," the official told reporters on condition of anonymity.

Another official said several people in the Obama Administration and the Congress are uncomfortable with the funding measure of the Bill, which essentially attacks the Indian companies.

But given the prevailing mood in the country on the eve of the crucial mid-term election, they do not want to be seen in anyway opposing a measure which is strengthening border security, the official observed.

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The main focus of the controversial bill is on strengthening security along the Mexico border. Because immigration has become a major issue in Southern States and there is also the unemployment dimension, nobody wants to be seen to be acting against such a measure, official noted.

Some US analysts have also pointed out that the real problem for US trade and unemployment is China, but because the economic and financial nexus with Bejing is so strong that there is essentially some kind of a fear of taking on China. Hence, a soft and friendlier target India appears to have been hit.

The US would not like to have any adverse impact on the Indo-US economic ties given that Secretary of State Hillary Clinton has emphasised on the importance of building on the economic relationship between the two countries, officials said.

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On her maiden trip to India in 2009 in her capacity as Secretary of State, Clinton made Mumbai her first stop and had her first meeting with the business community of India. This summer, Clinton opened up the Foggy Bottom headquarters of the State Department for the Indo-US CEO's Forum meeting.

In a statement on Tuesday, the US-India Business Council - that represents American companies doing business in India - had urged the Congress and the Obama administration to resist from taking such "draconian" measures.

"We urge the Congress and the Obama Administration to amend this new funding method for border security and any policies that would harm America's economic interest and undermine the burgeoning economic, trade and strategic relationship with India," said Ron Somers, president USIBC, an affiliate of the US Chamber of Commerce.

"It is unfortunate that the Congress passed a Bill that not only links India to border security with Mexico, but also does not take into account the terrible economic impact this will have for the United States," Somers said.

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The new Bill imposes substantial and discriminatory fee increases on global information services companies that utilise temporary, non-immigrant visas (H-1 and L-1) to bring in skilled professionals to serve American companies, he said, adding the USIBC hopes amendments will excise these harmful provisions.

"The value and expertise American companies receive from these services firms strengthen their global competitiveness and help to fuel innovation at home. Moreover, many companies, confronted with higher costs due to the legislation, will be an incentive to move more jobs and businesses offshore," he added.