Last month, Elon Musk, the owner of Tesla and X and a close adviser to US President-elect Donald Trump, the American legal immigration process as being “ridiculously slow and difficult.” Musk, who emigrated to the US as a student decades ago, has built a global empire.
Both India and the US would benefit from a more open bilateral visa regime. Indians and Indian-Americans are key drivers of US growth, particularly in the tech sector, where they play an outsized role and have even more to contribute. companies employ 4.25 lakh people in the US and have made $40 billion tangible investments in the American economy.
Similarly, the US continues to be India’s source of foreign direct investment (FDI), with American companies like Google, Microsoft, and Amazon leading the way in job creation in India. For instance, Apple is expected to up to 6 lakh direct and indirect jobs by the end of this financial year.
If the US wants to continue attracting the best and brightest, its immigration system needs an overhaul. For example, in 2023, the employment-based green card backlog a record 1.8 million cases, leaving new Indian applicants with seemingly a lifetime wait. Similarly, India’s visa system, with its manifold regulations and intrusive demands, remains restrictive for American researchers. The current visa policies of both countries are not conducive to the exchange of ideas and talent, which hinders economic growth.
Corporate and academic cooperation
People-to-people ties have been at the heart of US-India relations for decades. To ensure that these ties deliver tangible economic benefits, both countries need to adopt more open policies. Making it easier for Indians and Americans to get short-term work visas would allow each country to harness the other’s talent in the short run while ensuring their return to the home country in the long run. This would also maximise the potential for corporate and academic cooperation, ensuring that India-born talent continues to contribute in the US economy while eventually making their way home.
Fostering two-way talent exchanges could be mutually beneficial. Programmes like the US-India Initiative on Critical and Emerging Technologies (iCET) and the US CHIPS and Science Act of 2022 emphasise the need for technology development and exchange in critical fields, partially through workforce education and training. These frameworks can act as platforms to address talent needs and strengthen bilateral collaboration.
The increasing presence of US global capability centres (GCCs) in India also presents a significant opportunity. With over 1,700 , India’s human resource advantage can facilitate the rapid expansion of these companies, enabling them to contribute not just in software but also in areas such as hardware, biotech, and pharmaceuticals.
However, to fully realise the potential of its large tertiary-age population, India needs to augment the capacity and quality of its higher education system. Currently, India lags behind its peers, such as China and Brazil, in higher education enrollment. The US, with its comparative advantage in providing high-quality tertiary education in English, can help fill this education and skills gap.
Recent changes in India’s education now allow foreign universities to set up campuses in the country, opening new markets for international higher education institutions. Notably, universities such as Deakin University and the University of Wollongong have already established campuses in India.
India has a large talent pool with a strong preference for STEM courses but lacks a robust research and development (R&D) ecosystem. US universities, which excel in R&D, present a unique opportunity to leverage India’s talent to address global and bilateral challenges. Given these recent policy changes, exploring innovative models to facilitate greater participation of American universities in India’s higher education and research landscape would be worthwhile.
To bolster collaboration in higher education, the Indian central and state governments must reduce regulatory approvals and make it easier for American universities to operate. One approach is to launch a programme similar to the Smart Cities Mission, but with the goal of setting up “universities of the future”. Initially, one university in every state could be designated as a hub for foreign collaboration, with the programme expanded as other universities see the benefits. Additionally, India should consider establishing new university cities, addressing two critical needs: ensuring more cities generate jobs and decongesting existing urban centres while meeting the growing higher education demands of its burgeoning young population.
India currently hosts a relatively number of expats, particularly highly educated foreign nationals who could contribute to its development in areas ranging from science to corporate governance. Attracting and retaining such talent from abroad would benefit India immensely. To achieve this, India needs to foster a more open environment that promotes academic freedom, supports research collaboration between Indian and foreign universities, and ensures the financial viability of research projects by easing regulations that complicate international grant proposals.
National security interests
Another key area of national security interest for both countries is the semiconductor sector. India has a comparative advantage in chip design, with around 19 per cent of the based in the country. With a large pool of engineering graduates entering the workforce annually, India is well-positioned to meet the growing demand in the US semiconductor industry.
In recent years, the Indian startup ecosystem has witnessed significant growth in deep technology ventures. With over deeptech startups, India now has the sixth-largest deeptech ecosystem globally.
However, Indian deeptech firms face challenges similar to those of other industries—particularly limited access to capital due to the substantial wait times for returns on investment. In 2023, funding for Indian deeptech startups by 77 per cent compared to the previous year. Increased access to patient capital from the US could address this challenge and create mutually beneficial opportunities for both nations.
There are several areas for collaboration between the US and India, many of which align with their shared domestic and national security interests.
Nonetheless, both countries face challenges that need to be dealt with, that too at a time when both countries are more populist, protectionist, and historically inward–oriented.
The new governments in both India and the US must prioritise these measures to sustain the continuity and accelerate the exchange of ideas and human capital, ensuring long-term benefits for both economies.
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