Upset over rigid data localisation rules, US warns India with H-1B visa caps: Report

Amid intense tariff wars, the US has issued a stern warning to India over rigid data localisation rules. According to a Reuters report, the Donald Trump administration has conveyed to Indian authorities that, “it is considering caps on H-1B work visas for nations that force foreign companies to store data locally.” New Delhi has been adamant on strict data storage rules, which has reportedly peeved companies such as Mastercard. The Reuters report said that there is no current country-specific limit on the 85,000 H-1B work visas granted each year and an estimated 70% go to Indians.

Meanwhile, an official statement issued earlier this week said that the Narendra Modi government and the Reserve Bank of India (RBI) will address all the concerns of technology and e-commerce firms around India’s data storage and protection norms and new legislation that are in the pipeline.

“All the companies who were represented in this meeting put forth their concerns related to the data storage requirements and processing related guidelines issued by the RBI. Deputy governor of RBI B.P. Kanungo, assured the industry representatives that the Reserve Bank of India will look into this," the statement said.

It should be noted that the RBI had in April last year asked payments firms to adhere to data localisation norms, suggesting these companies had to store data on Indian servers only. H-1B visa programme is popular programme under which skilled foreign workers are brought to the United States each year.  

In a related development, the Trump administration's decision to rescind work authorisation for H-4 visa holders, a large number of whom are the spouses of high-skilled Indian IT professionals, is yet to get a final shape as the rule making process is incomplete, an official has said. Under the previous Obama administration, certain H-4 workers were allowed to get employment authorisation. However, US President Donald Trump, soon after coming to power, said that he plans to rescind such a rule. The proposed rule is yet to be formally notified and the Trump administration has delayed the notification a number of times in the past two years.

(With agency inputs)