Australia visa proposal is bad news for Indian IT companies

Written by P P Thimmaya | Debojyoti Ghosh | Debojyoti Ghosh | Bangalore | Updated: Jul 3 2013, 22:19pm hrs
VisaThis could have a bearing on Indian IT firms operating in Australia. However, according to the Australian Information Industry Association (AIIA), 457 visa arrangements are used legitimately by the information and communications technology (ICT) sector to meet a genuine gap that exists between the domestic supply and demand of ICT skills. Reuters
Battling protectionist measures in the US, Indian IT players may now have to probably face a similar situation in Australia where the government is planning to place curbs on visas used by highly skilled foreign workforce.

The Labour party-led government is planning to introduce a new Bill where there will be tightening of the regulatory regime governing the employment of non-citizens through the '457 visa scheme'.

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This would essentially ask Australian businesses to make every effort to employ citizens first before hiring foreign professionals.

This could have a bearing on Indian IT firms operating in Australia. However, according to the Australian Information Industry Association (AIIA), 457 visa arrangements are used legitimately by the information and communications technology (ICT) sector to meet a genuine gap that exists between the domestic supply and demand of ICT skills.

Individuals, who hold 457 visas, not only fill real and immediate needs within ICT organisations, but also make a significant and positive contribution to the Australian economy.

AIIA pointed to allegations that the ICT sector is one of the worst offenders in what the federal government said is the "overuse of 457 visas are exactly that: Allegations.

To date, no data has been offered up to substantiate these claims. The AllA does not support any organisation that circumvents the very clear regulatory and administrative process requirements in place to recruit employees via 457 visas, said Suzanne Campbell, CEO, AIIA.

The skills shortage in the ICT sector is both an immediate and long-term concern in Australia. The ICT job numbers are expected to double between 1999 and 2015, while enrolments in training and education have fallen nationally by 55% over the last decade. 457 visas solve the immediate skills shortage issue local organisations are facing. The longer term solution to this issue is systemic changes in ICT education and skills development, AIIA said in a statement.

According to the Australian government's department of immigration and citizenship, 457 visa allows eligible employers to address skills shortages that cannot be filled from the local labour market. The subclass 457 visa is the most commonly used Australian visa program to sponsor overseas skilled workers on a temporary basis.

Over the last several months, the $76-billion Indian IT-export industry has been fighting against the protectionist stance in the US. Analysts feel the proposed US immigration reform bill, if passed in its current form, might disrupt India's outsourcing business model. The big concern for the Indian IT sector has always been on restricting the number of H-1B visas with a view generally expressed in the US that it is taking away local jobs.