Applicants from India for EB-visas may drop by 80 pc: CanAm
Mumbai: Applicants from India for EB- visas are expected to decline by up to 80 per cent if the US gives the go-ahead to hike the investment cap from USD 0.5 million now to USD 1.3 million later this year.
The employment-based fifth preference category (EB-5) visa is meant for high networth investors (HNIs) to earn the green card which offers permanent residency in the US for themselves and their immediate family through a one-time minimum investment of USD 5,00,000 into a new business that creates 10 or more jobs for the Americans.
According to CanAm Investor Services, one of the leading providers of this immigration-linked investment programme, the Trump administration's decision to increase the investment amount has been delayed till September 2018.
"The minimum investment limit is expected to increase from USD 0.5 million to USD 1.3 million. There are multiple proposals in place, one is by the Department of Homeland Security (DHS) that has proposed an increase in the investment amount to USD 1.3 million," CanAm Investor Services vice- president for India and Middle East Abhinav Lohia told PTI.
"Also, the DHS is of the opinion they can change the amount independently without a vote in the Congress," he said, however, adding if the amount is increased without a congressional approval, the regulation will most likely be litigated against.
As per CanAm estimates, the proposed increase in investment can result in a fall of about 80 per cent applications from India, which is expected to become one of the largest applicant countries in the world.
"The number of EB-5 visa applicants from India has more than doubled since 2014 and the country is expected to become the second largest applicant country in the world. In FY17, over 500 Indians applied for EB-5 visas against 354 in FY16," Lohia said.
"Depending on the increase in the amount, the number of applicants from here may fall anywhere from 50 to 80 per cent," he added.
The slump in number of applicants will likely impact new regional centres over the established regional centres.
"A lot of new regional centres will shut down because they will fail to raise the required capital for their projects. So not only will the number of investors come down, it will also cause a substantial fall in the number of regional centres," Lohia said.
As per estimates, the EB-5 market has been growing at 30-40 per cent every year from India.
As many as 500 applications were filed last year from India, resulting in an investment of around USD 300 million.
CanAm saw close to 100 per cent rise in the number of Indian investors - from 50 in 2016 to 97 in 2017 - and is expecting a similar pattern this year.
In India, its target audience includes high net-worth investors and their family.
Additionally, CanAm receives EB-5 applications from young educated professionals in the 25-35 age bracket as well as many upper-class parents from tier 1 and 2 cities who want their children to settle in the US for higher education and rewarding career.
"In India, parents and their children comprise more than 50 per cent of applicant numbers followed by young professionals and HNIs," Lohia said.