The Trump administration’s new proposal to overhaul the H-1B visa selection process signals a major policy shift that could dramatically reshape how high-skilled immigration works in the United States—especially for Indian nationals, who account for the vast majority of H-1B holders.
What Is Changing?
Currently:
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H-1B visas (capped at 85,000 per year, including 20,000 for U.S. Master's degree holders) are distributed via a random lottery system.
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All eligible applicants have equal chances, regardless of salary, qualifications, or employer.
Proposed Change:
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The Department of Homeland Security (DHS) is now proposing a “weighted selection process”, which would prioritize applicants based on non-random factors, likely including:
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Higher salaries
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Educational qualifications
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Seniority or specialized skills
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Although the specific criteria have not been detailed, the filing makes clear that this change would replace the lottery for the capped portion of the programme.
Why This Matters
1. Impact on Indian Applicants
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Indians made up 77% of H-1B visa approvals in 2022 and 72.3% in 2023.
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While Indians dominate the pool, many of these are junior-level tech workers employed by IT outsourcing firms at lower wage brackets.
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A salary-based or skill-based weighting system could reduce approvals for lower-paid applicants from Indian outsourcing firms.
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However, highly skilled Indians (like PhD holders, AI engineers, and STEM researchers) could benefit and see better odds of selection.
2. Tech Companies Could Lose Their Edge
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Large tech companies like Amazon, Microsoft, Meta, which flood the system with applications, may lose the advantage they currently hold under the lottery.
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A salary-based system could level the playing field, benefitting smaller firms offering competitive compensation.
3. Outsourcing Firms at Risk
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The existing business model of firms like Infosys, TCS, and Cognizant depends on placing lower-wage tech talent in the U.S.
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The proposed reform would disrupt this model, possibly reducing their competitiveness and presence in the U.S. market.
4. Boost to U.S. Economic Value
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A study by the Institute for Progress estimated that switching to a salary-based ranking could increase the economic value of the H-1B program by 88%.
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It would also increase the average first-time H-1B salary from $106,000 to $172,000, potentially curbing wage stagnation and abuse.
Support and Criticism
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Supporters say it’s time the H-1B visa rewards merit, not luck, and aligns more closely with national interest by attracting top-tier talent.
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Critics, particularly from outsourcing industries, warn that this could hurt diversity, limit mid-level skilled migration, and increase costs for tech services.
Prominent analysts like Connor O'Brien of the Economic Innovation Group praised the idea, saying:
"That it is randomly allocated is insane. America deserves better!"
What Happens Next?
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The USCIS is still drafting the rule.
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No final timeline has been announced.
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FY2025 H-1B visas are already allocated, so the earliest this could take effect is FY2026 (application window opening in March 2026).
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The rule could be subject to legal challenges, especially if it appears to disproportionately affect a specific group or sector.
In Summary
The proposed end to the H-1B lottery represents a seismic shift in U.S. immigration policy:
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High-wage, highly educated workers would gain,
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Low-wage tech outsourcing firms could lose out,
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And Indians, while still the largest pool, may face tighter competition unless they are in higher skill brackets.
It’s a clear move toward meritocratic immigration, but also one with deep economic and geopolitical implications, especially for India-US tech relations and domestic labor dynamics in both countries.
