Restrictive skilled-immigration policies in developed countries threaten India's services-led growth model. Examine in light of recent U.S. H-1B and PERM measures.

India's services-led growth depends on skilled workers moving abroad: India-born workers received about 72% of approved U.S. H-1B petitions in FY2023 [2]. In September 2025 the U.S. imposed a $100,000 fee on new H-1B petitions. In October 2026 it suspended several firms, including Indian IT majors, from the PERM green-card programme [1]. The threat these measures pose is real but gradual, not existential.

How the measures threaten the model

• IT-services delivery: about 65% of approved H-1B petitions are for computer-related jobs [2]. The fee raises the cost of every new on-site deployment, and H-1B registrations fell after it was imposed [1].
• Talent retention: the PERM suspension blocks the permanent route (PERM → I-140 → green card). Firms can no longer use it to keep senior staff in the U.S. [1].
• Remittances and the rupee: India received about $120 billion in 2023 [3]. Advanced economies have overtaken the Gulf as its main remittance source [4]. Fewer new entrants slowly erode this formal dollar cushion for the current account.
• Policy uncertainty: the fee came by executive proclamation and has been contested in court [1]. Workforce planning becomes a gamble.

Why the threat is limited

• Workers already in the U.S. keep earning and remitting, so the damage is cumulative, not sudden.
• OECD competition for talent: most OECD countries are easing routes for the highly qualified, for example Germany's Opportunity Card [5].
• Alternative corridors: the India–Germany Migration and Mobility Partnership provides 3,000 job-seeker visas a year under a treaty [6].
• Offshoring: Global Capability Centres move high-value work to India itself.

Way forward

• Seek binding GATS Mode 4 commitments in the India–U.S. trade deal. A treaty commitment is harder to reverse than a proclamation.
• Fully implement the Germany partnership, as both sides committed at the 7th Inter-Governmental Consultations [7], and replicate it with other countries.
• Track shifts in remittance sources through the RBI Remittances Survey [4].

U.S. curbs raise costs and uncertainty for India's IT exports, remittances and talent pipeline, but the erosion is slow and can be managed. India can keep its services-led growth on course by diversifying destinations, putting mobility into treaties and moving up the value chain at home. Doing so would turn brain drain into brain circulation, in line with SDG 10.7 on orderly and safe migration.