Us Green Card Shock For Indians Waiting 20 Years Govindraj Ethiraj The Core Report

TITLE: US Green Card Shock For Indians Waiting 20 Years | Govindraj Ethiraj | The Core Report CHANNEL: The Core DATE: 2026-05-26 ---TRANSCRIPT--- Good morning. It’s Tuesday the 26th of May and this is Kovindraj broadcasting and streaming weekdays from Mumbai, India’s financial capital. This of course is a holiday shorten week. The markets are closed on Thursday and we will have a special edition on that day. And our top stories and themes. The scent of a deal sends oil prices down, markets up. Why oil markets are now nearing minimum operating levels. Modi’s crystal say India balance sheets were strong going into conflict and what that means what the new green card rule means for Indian visa holders in the United States and oil prices rise for the fourth time in [music] 15 days. [music] This is [music] a call report with Govind Raj at

the United States and Iran are closing in on a deal that could reopen the straight of Armas according to officials who spoke on Sunday even as President Donald Trump insisted he would not rush into an agreement. Officials told Reuters that nothing is ready to be signed as negotiators work through precise language on key issues and final approval could still take several days. Bloomberg reported also quoting Iran’s semiofficial Tasnim news agency saying the draft deal could still collapse because the US is blocking several clauses including Thran’s demand that its assets be unfrozen. Meanwhile, oil prices fell nearly 6% to twoe lows on Monday. Brent crude futures were down $6 roughly to about $97.50 a barrel. At this level, we’re close to the $95 a barrel figure which many analysts here are using as a base case to estimate impact on business and economy in coming months and much more on that shortly. Meanwhile, more worryingly, oil markets are nearing minimum operating levels in Asia with Europe likely next and the United States potentially facing shortages by July according to market strategist Jeff Curry who spoke to CNBC on Monday. According to M headline, global inventory figures can be misleading as much of the oil stored worldwide cannot be used immediately. A large portion of that oil is needed to keep pipelines and storage systems running safely, leaving only a smaller share available for the market. Asia is already close to these so-called minimum operating levels, he told CNBC in Singapore. Reuters is meanwhile reporting that in April and May, Indian refiners raised imports from Venezuela, Brazil, Angola, and Nigeria to make up that shortfall as well as continuing to buy Russian oil. Also quoting data from Kepler. Keeping with the general optimism over the weekend on the prospect of the deal, something that we were expecting, the Nifty50 was up 312 points to close at 24,031 and the Sensex was up 1,073 points to 76,488. In the broader markets, the Nifty midcap and small cap indices were up.9 and 1.3% higher. The rupee strengthened for the third consecutive session and that was its longest winning streak in a month thanks to Reserve Bank interventions and of course a fall in crude oil prices. It closed at 95 rupees 23 pes up 1.5% since Wednesday according to Reuters. On Wednesday, the rupee had hit a record low of 96 rupees 96 by say that’s almost 97 rupees to a dollar. Reserve Bank of India Governor Sanjay Malotra said in an interview to the Mint newspaper that the currency may now be undervalued following its recent slide versus the dollar. The rupee is down about 6% this year thanks to record foreign outflows from local stocks. Gold prices meanwhile rose by about a percent on Monday following that optimism for a breakthrough in US Iran peace negotiations which weakened the dollar and lowered oil prices and thus of course softening the inflation outlook. Spot gold was at about $4,559 per ounce on Monday morning according to Reuters. And then the price hikes back home state fuel retailers increased diesel and petrol prices by 2.7 and 2.6 6 rupees and this is the fourth hike in May since the hike started which is since the 15th of May. [music] Rating agencies Moody’s along with its India partner Ikra and separately Crystal ratings have put out impact assessments of the war on the economy and companies at this point. Chrysler has said the protracted conflict in West Asia has been goating domestic companies to realign supply chains, navigate pricing issues, manage higher fuel and freight costs and content with of course a depreciating rupee. From a credit quality perspective, Crystal says its analysis shows India Inc. will remain resilient on the back of strong balance sheets, steady domestic demand and governmentled capital expenditure, enabling it to navigate profitability pressures stemming from the lingering geopolitical uncertainties. It says it stress tested 34 sectors which account for 65% of its rated corporate debt. It assumed supply chain disruptions could last for 9 months this fiscal compared to 6 months in the base case with crude oil prices averaging $110 per barrel for this fiscal versus a base case assumption of $95. Remember we pointed out earlier that the current price of $97 is close to the base case assumption of most analysts for their forward projections. Now, Crystal says that based on their results, they infer that the prolonged supply chain disruptions could shave off corporate operating profitability by about 200 basis points this fiscal as opposed to a pre-conlict expectation of 12 basis points with some sectors seeing a more pronounced impact. It also said that of the 34 sectors tested, 22 would see operating profitability being culled more than 10% thanks to higher inventory costs and inability to fully pass on the burden to consumers. And for companies, managing costs and profitability will be a bigger challenge than achieving topline growth. It also says that credit profiles would be cushioned by controlled gearing levels and sustained domestic demand and thus credit quality of only eight sectors accounting for 10% of their rated corporate debt would be materially impacted. Meanwhile, Moody’s rating says credit conditions for Indian non-financial corporates remain underpinned by a strong starting position, robust balance sheets, and favorable long-term growth prospects. However, the conflict in the Middle East says Moody’s will weigh on near-term earnings and cash flows for energy intensive and fuel dependent sectors. It also says that India’s heavy reliance on imported crude oil and liqufied natural gas and certain petroleum products exposes companies to higher input costs, currency volatility and supply chain disruptions. I spoke with Vikash Halan, a Moody’s managing director and K. Ravi Chandran, executive vice president and chief ratings officer of IKRA who’s also Moody’s India partner and affiliate. And I began by asking them if companies had stronger balance sheets and thus better prepared what was the bad news or the flip side from our perspective because there is a bad news that’s why we were talking about all the stock absorption the bad news is that we have energy disruption at the same time when we are looking at Elino and its impact on potential consumption slowdown with the energy disruption of course you’re going to see a degree of inflation which may have cascading impacts on both interstates consumption discretionary spending which can have also impact on government spending. So that is the risk that we are highlighting but because the kind of corporates that we rate in India which are the cream of the crop so to speak and how they have managed their balance sheet over the last 3 four years what we highlighting is that there is an ability to absorb those shocks. So there is clearly the bad news but the good news is they have the ability to absorb the shop. And what does that say in terms of India Inc.’s let’s say the propensity to invest in capital expansion or new projects or anything along those lines again going back a few years you will see that there is a section in that report where we’re talking about the slowdown in the growth rate of the capex that the corporates are spending on and this is excluding the infra part by the way so these are all the corporate side that we are looking at and that is not surprising given that the level of uncertainty that we have you know seen over the last four or five years with one shock after the other. Investment decision tends to thrive when there is a high degree of certainty whereas in this case the level of uncertainty is certainly trying to move money away from investment probably return capital to the shareholders or also trying to look for other destination. So things like the AI and data center or new energy you will probably see money going in those direction and that’s where even globally that’s the trend we are seeing a lot more capex away from traditional industries and more on some of the industries that are on the horizon right and I’m going to come back to a larger question on how Moody’s is looking at India right now Vikash but Ravich then so 26 27 outlook and within that which sectors are looking better given all of what we’ve has talked about and which are perhaps let’s say under more pressure. Yeah. So even under the current challenging times we believe there are a couple of themes where you know the outlook would be fairly be good. Number one being defense you know defense is one area where India is trying to invest more and a lot of private sector participation you know is happening over here as a result position of both PSUs as well as private sector you know they are at the high level. While there’s always concern around the working capital cycle and you know liquidity related you know issues in general payment certainty is there. So because of that you know there is good visibility on the orders. Second area is on the capital goods power sector especially has been seeing lot of investments on the you know the renewable energy area as well as transmission systems and and also the distribution side of the value chain. Because of that there’s huge demand for capital goods like you know transmission towers and transformers and rectifiers and so on so forth. Capital goods you know is playing a important role you know in the current construct and third is on the hospitality side. Hospitality you know is a space where you know it’s going to be a steady sector. A lot of investments are happening especially from the private equity players and many of these chains are investing in different cities and they’re adding beds and modernizing their equipment and so on so forth. At the same time you know the penetration of insurance is increasing in the sector. As a result you know the value that you derive from every patient is increasing and as a result overall it’s a good you know story for you know hospitality sector as well. While this industry is subsidized but subsidy has not been to the extent the industry would have liked because of the you know there is pressure on margin as well as on the liquidity also because of the ATF price impact and also depreciation. you know this business is highly backed and we believe there could be huge cash losses in the current year despite retail price increase and petrole still there is a large gap to cover so from that point of view this year you know could be very challenging year for the OMC’s perhaps government needs to give them more time even if good prices were able to correct to you know $780 in a postwar scenario perhaps government needs to give OMC’s more time to absorb these losses you know in a steady environment so these are three exposures addition to that we have a negative outlook on you know the micr finance sector in the financial sector space and paper and print media and so on so forth there are about nine sectors where we have negative officials the major ones would be you know the ones I’ve already discussed right and what’s your best case and worst case assuming let’s say the war or even if there is some resolution to the war but let’s say oil prices remain high there is not much movement of energy through the state of assuming all of that stays as it is or the impact is as it is what’s the impact do you see on balance sheets going into next year and if assuming that’s the bad case then what’s the good case or the better case base case about $95 for the group you know the companies in this fairly large and their ability to borrow money from the banking system and capital markets is fairly you know at a good level and also some of them are owned by sovereign while the case of you know sector and alien sector perhaps there is pressure which could be emanating if you know the group price average group price were to go beyond $100 you know at that point in time you know losses could is so used that you know it could eat away some of their net worth and you know the financial flexibility which these companies are enjoying. So everything would depend upon how long the you know conflict you know sustains. If it is let’s say 3 to 6 months from here on you know credit quality will be mostly be contained but in case if it be prolonged then you know because of marginal pressure as well as additional debt that will put pressure on the credit matrix and you know ratings could be under pressure in the near ter. What we have seen over the last three months is not really the actual level of shortage because there was a lot of reserve draw down bears a lot of seaborn crude that made its way through refineries. So we haven’t really actually felt the impact the full impact of the disruption but if this lasts for a long period of time there was analysis that was done by some of the equity houses around you know how much reserves are needed to keep the reserves operational because the pipelines the containers everything needs to be operational and we can run out of that at least the point of no return by September by certain analysis so if this last long a you don’t have that much seab bond crude that is available. We the reserve have a limited amount of time that you can do or draw down on. So if this lasts for long there only option left after that is demand destruction. Other than demand destruction you won’t be able to balance the energy demand and supply right and I mean I’m assuming the demand moderation could perhaps happen because we are raising prices now every week for the last four weeks in India. you know that’s not going to solve and it’s not just India across the world. Yeah. Yeah. And the demand destruction or demand moderation as you say will mean that you actually need to put in actual rationing you need to mandate work from home you need to restrict air travel. So there is all those measures you know somewhat similar to what we saw during the co when we saw demand declining by 10 million barrels all of a sudden right and that is the amount of destruction that we may need moderation that we may need to balance the markets right and yeah so we definitely need to do more we are looking at inflationary conditions now and rate hikes seem imminent what do you feel we should be heading towards and what could be ideal at least in the next few months yeah From standpoint, you know, suddenly there are pressures which are evident already the market indicators like overnight index swap they’re indicating that you know there’s a need to raise rates by at least 100 basis points if not more but at the same time you know policy makers will look at growth impact so it’s going to be a carefully thought out decision which will be datadriven RB has articulated that if need be you know they would also look at that as one of the tools but you know I would believe that would be a lost resort you know we will try all other you know tools available you know whether it in terms of liquidity enhancement measures or you know dollar strengthening measures those tools will be used first before the rate hike comes into the picture okay Vash last word what’s the Modi’s outlook for India given all of this and your call on rates I mean I can’t take a call on the rate per se but the general direction is if inflation goes up you would expect a tightening cycle to follow that’s the extent of my knowledge on the rate hike but when it comes to our outlook for corporates in India uh we continue to remain fairly comfortable with where the credit stands over the last six or seven quarters. We have seen net upgrades. Most of the corporates are rated investment grade and in fact most of them have a stable outlook. We think there is a lot of buffer to absorb some of the risk and we continue to remain fairly constructive despite you know the headwinds that we see. Right. Mikash and David thank you so much for joining me. It’s a pleasure. Thank you. [music] On Friday last week, the US has moved to significantly restrict who can obtain permanent residency in the country potentially affecting the fate of Indians on temporary visas who were awaiting a green card. The US Department of Homeland Security, which oversees the US Citizenship and Immigration Services, or the USCIS, announced that those applying for green cards must return to their home countries to do so, which reverses a practice that has been in place for almost 50 years. People usually apply for green cards in two ways. Going to a US consulate overseas or applying to one while already in the US, which is called an adjustment of status. The new USCIS policy memo, according to an Indian Express report, targets the second more popular route used for decades by Indian workers on H1B visas, students transitioning from F1 to work visas, and spouses on H4 dependent visas. The new policy, the report says, is especially concerning for Indians because they dominate the decadesl long backlog in employmentbased green card categories like EB2 and EB3. For many Indian professionals, the weight stretches beyond 15 or even 20 years. I reached out to Purvi Chotani, founder and managing partner of Lawquest, a global immigration law firm with offices in Mumbai, Florida and New York and she joined us from Florida and I began by asking her how she was reading the announcement that came over the weekend. So basically what the USCIS policy memorandum has instructed its officers to do is they’ve reminded them that all green cards actually should be processed overseas. When they were approving them within the country as per the adjustment of status application filed, it was actually a courtesy and it was now at their discretion whether they grant this courtesy or not. And the discretion they’ve said is unless it is in the economic advantage of the country or the person is subject to extraordinary circumstances. Adjustment of status is not the norm. That is actually the exception. So what they’ve done is they’ve changed their policy of adjudication. And they haven’t changed the underlying law. The law still remains. But by doing this, what they’ve added is a standard of review because now there’s a standard of review of extraordinary circumstances which wasn’t there before. So some lawyers are interpreting that as a change in law because you cannot change the adjudication standard unilaterally like this. That is what the argument is. What we in our firm are doing is we are playing a wait and watch game. We are waiting and watching because we luckily don’t have any critical cases that are going to get impacted today or tomorrow or you know in the next 15 days. So we are playing a cautious game for now. Right. If I can take a step back, could you define for us what green card actually means and what do people get when they acquire one? Got it. So green card is the term that is used to describe an immigrant visa. The United States grants two types of broadly speaking two types of visas. non-immigrant visas and immigrant visas. When you get an immigrant visa, you get the right to live permanently in the United States and after a passage of time and physical presence in the country, you may be eligible to apply for citizenship. So loosely this is called a green card and this name came historically because when they started issuing these cards as evidence of immigrant status or permanent resident status that card was a green color card and it has since then continued in that vein. So that is why it’s called a green card. But it’s actually an immigrant visa granting permanent residence rights. And what is the transition from green card to citizenship? And is that automatic? No, green card to citizenship is also not automatic. You have to have spent at least half of the time in the United States in the 5 years preceding the date on which you apply for citizenship. You file a form called N400 to apply for citizenship. And let’s say you’re applying on June 1st. You take the period 5 years going back from then and at least 50% roughly speaking, okay, there’s a numeric value, but at least 50% of those days have to be spent within the United States, physically within the United States. And any travel abroad should not be for more than 6 months because if you have been abroad for 6 months that is outside the United States for 6 months your clock resets and your 5-year period starts from that again or your 2 and 1/2 year period starts from then again depending on how we are going to calculate it. So it’s physical presence minimum stay and no absence of more than 6 months. In addition to this, what last year the government Trump administration also introduced a good moral character requirement. So you’ve got to prove that you do not have anything negative in your history. So of course if you have a criminal record or something then you may become ineligible for citizenship. But now they’ve added another standard to it whether you have a good moral character. In that what they can do is they can go to your neighbors and ask them that is this person of good moral character or if this person has a small shoplifting episode or something then what happens so they go deeper into the person’s profile to gauge whether this person is deserving of US citizenship right and one of the constituencies that’s affected by or affected the most by this appears to be the H1B visa holders so what happens to a classic H-1B which of course many of them are IT indust people as well. So an H-1B visa is actually a non-immigrant visa. It allows people to work in the United States and it allows them to have immigrant intent. So now let’s compare this with another visa category to understand what the difference is. So if you’re coming to the United States to study, you come on an F1 visa usually. And that F1 visa is a pure non-immigrant visa. You cannot have immigrant intent when you apply for the F1 or when you enter the country on an F1 visa. While on the H1B visa, you can have dual intent. You can have an intention to remain and work temporarily in the United States or you may have permanent immigrant intent. So that’s why it’s called a dual intent visa. Now, many people who are on the H-1B track are also on a green card track. Not everybody who has an H-1B is on a green card track. But if the employer files a green card application for them by doing a labor certification that’s testing the local labor market, proving there is no local worker etc. they come on a green card track and the one stage of the green card track is filing a form I40. When you file that and that is approved, then a person who’s on an H-1B can get extensions beyond six years because an H-1B non-immigrant visa is confined to 6 years of continuous stay in the United States. Then you leave the country with a one-year cooling off period and you may be able to start another stint of 6 years. But if you’re in an advanced stage of green card, then you can have unlimited three-year extensions or sometimes one year extensions until you get your green card. So there are many folks who are on that. They’re all waiting for the 15 20 year lapse that they have to wait for before their visa number becomes current. That means their priority date becomes current. Now while they’re on that, they can continue to be on H1B, but they have to wait for their green card number. Now when the green card number becomes current they may be able to file an adjustment of status application and this is where the new policy memorandum kicks in. At that time after waiting for 20 years and their priority date becomes current. If they go for adjustment of status they may not be granted that they may be denied that. At the moment there is no prohibition to file adjustment of status. There’s only changes how it’s going to be adjudicated. So assuming that you can still file after 20 years, you will file it, but there’s no guarantee you will get it. What we saw recently, just yesterday, I mean two days ago, one of our colleagues, a fellow lawyer got an RF in a adjustment of status case. An RF is a request for further evidence. In an adjustment of status case, these are very rare unless there’s a criminal record or a medical issue or something like that or an eligibility issue. But this RF was very interesting. It has asked about eight or 10 questions on proving this person’s worth to the United States. What is your salary? What is your economic benefit to the country? What is your community engagement? What are you contributing to the community? etc., etc. All these are leaning towards the current policy memorandum criteria of discretionary decisions for worthy people. This shows us one thing that the USCS was very well prepared. this time they came out with the announcement and the RFS were ready to issue. So this was like well planned and announced on a Friday you know it just threw all the immigration attorneys office put the people in a panic and that too at the beginning of a 3-day weekend. So all these green card holders or on H1B are now worried that their adjustment of status application which may be pending because it’s already filed for many cases or which they’re going to file in the near future is in jeopardy. So, will they have to leave to pursue that? Yes, they may have to leave because if the adjustment of status is denied, that doesn’t mean they’re not eligible for the green card. They still may be eligible for the green card, but they’ll have to leave the country, go to their home country because now they can only apply in their home country because of another change that came about last year. They can only apply in their home country and they will have to wait for a visa appointment. Now, this gets even more alarming because the consular officers remain the same. they have not increased the capacity of people at the embassies and consulates to handle the onslaught of this additional work that is going to come to them. So the same officers that issue F1 visas, H1B visas also issue the green card visas and just now the volume of green card visas was small and usually it was usually family based because most of the employmentbased visas were adjustment of status applications within the United States. So now the US embassy and consular staff is going to bear this onslaught of new work and that is going to increase wage times. So let’s say this person his priority date is current. The adjustment of status is denied. He has to leave the country apply for a green card and come back. That could be a lapse of several weeks, months, years. We have no clue. And that could then in effect break his employment and then the employer will say I don’t need you because I have to replace you within the country. The domino effect of this announcement is going to have devastating impact on many families. Purvey, thank you so much for joining me and walking us through what this new law means or proposed law means. I mean, I just want to leave your audience with this. It’s not all gloom because if you are an economic advantage to the country like you are a high earning AI technology or anything technologist or anything like that, you could still get the adjustments of status approved. So, it’s not all gloom and doom, but it’s going to be decided on a case-by case basis. Wonderful. Thank you so much, Vi. Thank you. Nice talking to you, Govin. IT company’s H-1B visa approvals have fallen sharply this year as the administration in the United States tightens rules around work visas and green cards as we just discussed, pushing the industry towards more offshore work from India and greater local hiring in the US. A report in mint quoting official US data says India’s six largest information technology services firms that’s TCS, Cognizant, Infosys, HCL, Vipro and Tech Mahindra were given about 11,000 H1B visas as of 31st March 26 which is down 40% from the previous year when they got about 18,400 visas. H1B visas allow Indians to temporarily work in the US in specialized occupations including IT services. Now there are of course two trends here. First is that Indian IT services companies are reducing and for years have been reducing their dependence on H1B given also the incremental $100,000 visa cost announced last year and the US government is pushing strongly towards attracting highly skilled foreign workers and protecting the wages. So the stress here is highly skilled and protecting wages, working conditions and job opportunities for American workers. Back to green cards, many H1B visa holders live on H1B visa extensions. while applying for a green card. The total limit for which is 9,800 per year. Larger applications and fewer green card slots lead to backlogs that can span decades as we just discussed. [music] That was the core report with me Govindraj Ethi. Do stay connected with more of our coverage at the core. You can check out our website or sign up to our newsletter for our exclusive stories. one in-depth feature a day on www.thecore.in. Do also track us on LinkedIn where we usually post synopsis or extracts of our top stories and interviews. We would love your feedback on how we can make business more interesting [music] and relevant including of course India’s vibrant manufacturing sector. So write to us at feedback atthecore.in [music] and thank you once again for listening.