- EB-5 program allows eligible foreign nationals and their immediate family members to obtain green cards by investing a minimum of $900,000 in a job-creating new commercial enterprise.
Discouraged by the long wait time to obtain a green card, Indian nationals on H-1B visas are increasingly applying for immigrant investor visas in the employment-based fifth preference (EB-5). Created by Congress in 1990, the EB-5 program allows eligible foreign nationals and their immediate family members to obtain green cards by investing a minimum of $900,000 in a job-creating new commercial enterprise.
U.S. Citizenship and Immigration Services (USCIS) data reveals an increase of more than 300 percent in Indian nationals who have received immigrant investor visas. The number of Indians granted an EB-5 visa rose from 174 (principals and dependents) in 2017 to 585 in 2018 and 760 in 2019.
In a recent article in Forbes magazine, Stuart Anderson wrote that the increase in Indian nationals on H-1B visas applying in the EB-5 category, “supplies further evidence that the claim that highly skilled foreign nationals are ‘cheap labor’ is a myth used to unfairly stigmatize such individuals.”
Immigration attorney Neena Dutta told American Kahani that many Indians are and will turn to EB-5s, for the sheer fact of the visa processing time. “If you have a software engineer who works for a startup and has made a ton of money through stock options, why wait 15 years when they could wait only the processing time for the I-526,” the New York-based Dutta said.
Indians endure much longer waits for green cards because the law imposes limits on the number of green cards for immigrants from any single birthplace and because U.S. employers file far more petitions for Indians than the limits allow. According to the Cato Institute Freedom of Information Act, “skilled Indian workers make up 75 percent of the employment‐based backlog, and recently backlogged Indian workers face an impossible wait of nine decades if they all could remain in the line.”
Sheela Murthy, an immigration attorney in Owings Mills, Maryland told American Kahani that green card waits are one of the most common reasons for people to consider the EB-5 category. “It’s a great options for those who have the financial wherewithal or resources to invest,” she said. But it is not just those on H-1B visas that are applying, Murthy said, adding that a lot of Indian students of F-1 visas who are from affluent families as well as those on L-1 visas are taking advantage of this category. Murthy said her law firm has seen an increase in interest well as an increase in petitions in the past three-four years.
The September 2020 Visa Bulletin posted on the U.S. Department of State website which shows the final action dates for employee-based preference cases, indicates that the status for EB-5 visas is current, i.e., numbers are authorized for issuance to all qualified applicants. On the other hand, wait time for other categories in employment-based visas show a wait time of at least 11 years.
According to Bethesda, Maryland-based immigration lawyer and expert on immigration law and process, Prakash Khatri, the surge in petitions for EB-5 category will eventually result in backlogs, if the quota allocated to India exceeds. A maximum of 10,000 visas are available in the EB-5 category, with a maximum of 7 percent allocated to a single country, according to information on the U.S. Department of State website.
“So around 700 visas are potentially allocable to India, assuming there are 12 to 13 countries which are applying in this category,” Khatri explained. “Once there are significant countries applying, India will be restricted.”
Under the EB-5 category, the principal investor can apply for the spouse and unmarried children under the age of 21, for receiving an EB-5 green card under the petition. “However, each family member is calculated as a separate petition, under the per country quota,” Khatri said.
Citing data from last year, Khatri noted that although the total applicants for the EB-5 category were 760, the actual investors would be around 250. “It is not the best investment vehicle,” he said. “But Indians are in an awkward position with backlogs in all green card categories.” In a lot of cases applying for an EB-5 visa could be a “desperation move.,” he said.
The surge in petitions for EB-5 visas despite the increase in the investment amount shows that for those who have made money, this is an easier route to take. Anderson wrote in Forbes that Indian H-1B visa holders, especially those in STEM, have earned enough to accumulate a significant amount of capital. According to a Department of Labor directive, when hiring an H-1B professional, “companies must pay the higher of the prevailing wage or actual wage paid to all other individuals with similar experience and qualifications for the specific employment in question.”
Employers also pay government-imposed fees and attorney costs of between $3,400 and $16,560 for an initial H-1B petition and $6,300 to $28,620 for the combined cost of an initial H-1B petition and an extension, according to the National Foundation for American Policy (NFAP). This is in addition to the wages paid to the H-1B employee, the NFAP said.
However, applying for an EB-5 visa doesn’t come without it’s challenges, Khatri said. Last November, the USCIS made several changes to the category, the most significant being increasing the minimum investment amount from $500,000 to $900,000. Khatri believes that given the current situation of economic insecurity with the Covid-19 pandemic, many Indian nationals will reconsider before investing such a significant amount.
He said many might be considering moving back to India or some other country like Canada or Australia. “With the uncertainties surrounding the Covid-19 pandemic, many Indian nationals are questioning if the U.S. is the best place to raise a family,” he said. Many EB-5 petitions are filed at Regional Centers, Kahrti said, which have their own challenges and risks. As of Dec. 6, 2016, there are 865 Regional Centers approved by the USCIS. Regional Centers are privately-held investment vehicles designed to manage job-creating projects to qualify EB-5 petitions.
However, Murthi said that despite the pandemic and the loopholes and risks, her law firm has been seeing a surge in EB-5 petitions and injuries for the past five-six months.
Bhargavi immigrated to the U.S. in 1997 and has worked with Indian American media since then in various capacities. She has a degree in English literature and French. Through an opportunity from Alliance Française de New York, Bhargavi taught French at Baruch college for over a year. After taking a break and two kids later, she went back to work in the Desi media. An adventure sport enthusiast, in her free time, she likes to cook, bake or go for hikes, biking and long walks.