Indian Americans fret over Big Beautiful law

Hindustan Times

30-07-2025

On July 4, as Americans marked the 249th anniversary of the nation's founding, President Donald Trump signed into law his signature legislative achievement: The 'One Big Beautiful Bill'. Spanning nearly 900 pages, the legislation overhauls the US tax code, boosts spending on defense, border security, and infrastructure, and introduces a wide array of industry-specific incentives and subsidies. While the bill's sweeping provisions will affect virtually all Americans, immigrant communities, including Indian Americans, are poised to face a wide range of challenges due to its provisions. (AFP)
In addition, the law slashes funding for some entitlement programmes, most notably Medicaid, to help offset the cost of tax cuts. Yet, it will still add an estimated $3 trillion to the national deficit of the US over the next decade.
While the bill's sweeping provisions will affect virtually all Americans, immigrant communities, including Indian Americans, are poised to face a wide range of challenges due to its provisions.
One of the many contentious elements of the legislation is the $170 billion allocated for border security and immigration enforcement. Of that, $75 billion — which is roughly the size of the entire annual defence budget of India — is set aside as additional funding for Immigration and Customs Enforcement (ICE), an agency that has drawn widespread criticism in recent months for its aggressive detention of undocumented immigrants and controversial deportation tactics.
For the Indian diaspora in the US, recent enforcement actions have already provided a sobering preview of what expanded ICE funding could mean.
India ranks second only to Mexico as the country of birth for immigrants in the US. According to the Pew Research Center, 6% of all US immigrants were born in India. Indian nationals also make up one of the largest undocumented immigrant populations in the country, estimated at approximately 725,000, trailing only Mexico and El Salvador.
Earlier this year, dozens of undocumented Indian immigrants were deported in chains, triggering widespread outrage in India. With ICE now receiving a significantly expanded budget, many fear that such outrageous deportations could become more frequent.
It's not only undocumented immigrants who are worried. The legislation's emphasis on enforcement and scrutiny is also creating anxiety among Indian nationals who are in the country legally, particularly those on H-1B visas to work in specialty occupations.
Currently, more than a million Indian nationals, most of them on H-1B visas, are stuck in the so-called green card backlog. This is due to an outdated provision in US immigration law that limits any single country to no more than 7 % of the 140,000 employment-based green cards issued annually.
As a result, Indian applicants are eligible for only 9,800 green cards each year, despite making up a much larger share of high-skilled foreign workers. This means that those in the EB-2 and EB-3 categories for workers with advanced degrees and professional skills, the wait can stretch for decades, and some may never receive permanent residency in their lifetime.
It remains unclear how the new legislation will directly affect H-1B holders, but the mood within the community is one of heightened anxiety. Many H-1B professionals fear that the Make America Great Again (MAGA) movement's 'America First' ideological opposition to foreign labour, combined with increased visa scrutiny under the current administration, could lead to tighter restrictions or even targeted enforcement.
This sense of uncertainty is not confined to the workforce. Indian students on F-1 visas are also feeling increasingly vulnerable, particularly in light of the administration's growing crackdown on campus protests and heightened policing of free speech.
Beyond immigration and visa concerns, the law also contains financial provisions that could directly affect the diaspora households, especially a new tax on international remittances. Beginning next year, a 1% tax will be imposed on remittances sent by US residents to family and friends abroad. Earlier drafts of the legislation had proposed a much steeper 5% tax, but that provision was scaled back following intense lobbying from the money transfer industry.
Estimates suggest that remittances from the US to India, primarily sent by Indian nationals and Indian Americans, range from $25 billion to $29 billion annually, making the US the single largest source of remittance to India.
Another provision that will impact immigrant communities, particularly those lower-income households, is the significant cut to critical public services like Medicaid. According to projections based on estimates from the nonpartisan Congressional Budget Office (CBO), the legislation would reduce Medicaid spending by $1 trillion over the next decade, potentially leaving more than 10 million additional Americans without health insurance. While there's a common perception that Indian Americans are uniformly affluent, this is far from the truth. Many families, especially recent immigrants or those in lower-wage sectors, depend on public health programmes for essential care.
All these provisions come with a substantial price tag. At the macroeconomic level, the legislation is drawing sharp criticism for significantly increasing the US national debt, which already exceeds $36 trillion.
From visa holders navigating an increasingly hostile immigration landscape to families sending money home or relying on public health programmes, the ripple effects of the new law are wide and deeply personal. In attempting to fulfill its promise of putting America First, the 'one big beautiful bill' may leave many behind, including Indian Americans who have long believed in the American dream.
Frank F Islam is an entrepreneur, civic leader, and thought leader based in Washington DC. The views expressed here are personal.