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US senator brands Indian IT majors 'chop shops'

Branding leading Indian IT companies like Infosys as "chop shops" that break stolen cars to sell parts, a US senator supported raising H1-B visa fees for them to raise $600 million to secure the porous US-Mexican border.

world Updated: Aug 08, 2010 21:52 IST

Branding leading Indian IT companies like Infosys as "chop shops" that break stolen cars to sell parts, a US senator supported raising H1-B visa fees for them to raise $600 million to secure the porous US-Mexican border.

"The best part of this border package is it is fully paid for and will not increase the deficit by a single penny," Democrat Senator Charles E. Schumer said during a Senate debate last week.

"The emergency border funds will be paid for by assessing fees on foreign companies known as chop shops that outsource good, high-paying American technology jobs to lower wage, temporary immigrant workers from other countries," he said.

"These are companies such as Infosys. But it will not affect the high-tech companies such as Intel or Microsoft that play by the rules and recruit workers in America," added the senator from New York, seeking unanimous passage of the Border Security Bill.

"This border package will, therefore, accomplish two important goals. It will make our border far more secure extremely quickly, and it will level the playing field for American companies and American workers to compete against these foreign companies known in the industry as using 'outsourcing visas'."

In response to a suggestion from 2008 Republican presidential candidate John McCain for using a part of the stimulus funds for the border package, Schumer said: "I prefer our source."

That "is from these companies which are not, as I say-they are companies whose whole purpose is to bring people in on H-1B and the vast majority of them from other countries who go back to the other countries. That is a better funding source."

"The bottom line is this. I like the H-1B programme, and I think it does a lot of good for a lot of American companies," he said.

But, "there is a part of H-1B that is abused, and it is by companies that are not American companies or even companies that are making something," Schumer said.

"Rather, they are companies that take foreign folks, bring them here, and then they stay here for a few years, learn expertise, and go back. We think we should increase the fees when they do that."

After the Senate passed the bill, Democrat Senator Claire McCaskill also criticised Indian IT companies saying: "A handful of foreign-controlled companies that operate in the United States - such as Wipro, Tata, Infosys and Satyam - rely on H-1B and L visas to import foreign workers to the US."

The proposed bill would hike the fee for H-1B and L1 visas most sought after by Indian IT professionals to $2,000 per application on those entities that have US citizens as less than 50 percent of their employees.