H-1B visa lottery may end: What this means for Indian techies, students

Business Standard

2 days ago

The US Department of Homeland Security (DHS) is preparing to replace the current random lottery system for H-1B visas with a weighted selection process—one that could reshape how Indians study and work in America.
In a filing to the Office of Information and Regulatory Affairs last Thursday, the DHS said it was considering a shift to a merit-based selection model. This would apply to the 85,000 capped H-1B visas issued each year, including 65,000 for regular applicants and 20,000 for those with advanced degrees from US institutions.
The new process is still under review, and further details have not been released. But the move could have far-reaching effects for Indian professionals and students.
The H-1B visa lottery is a random selection process used by the US government to choose applicants for the H-1B work visa when the number of applications exceeds the annual cap. Each year, there are 85,000 H-1B visas available—65,000 for regular applicants and 20,000 for those with US master's degree or higher. If applications exceed this limit (as they usually do), the US Citizenship and Immigration Services (USCIS) runs a computerised lottery to decide who gets a chance to apply.
Career choices shaped by visa outcomes
'It will almost certainly influence how Indian students and professionals plan their careers. If the system favours STEM roles, US degrees, or higher-paying jobs, we'll see a clear shift in demand toward certain academic paths, institutions, and employers,' Husain Tinwala, president, upGrad Rekrut, the staffing & recruitment arm of upGrad, told Business Standard.
He added that early career decisions could be driven more by visa odds than personal ambition.
In the 2023 financial year, around 191,000 H-1B visas were granted to Indian nationals. That figure rose to roughly 207,000 in FY 2024, continuing a long-standing trend of Indian dominance in the programme.
Entry-level STEM graduates may lose out
The proposed change could also make things harder for fresh STEM graduates trying to build a long-term career in the US after their studies.
'Changes to the H-1B visa programme will create a weighted lottery favouring higher wages, advanced degrees, and elite 'permanent' employers. This will most likely make it much harder for fresh STEM graduates to climb the ladder for long-term work in the US after completing their degree programmes,' Ritika Gupta, CEO and counsellor, AAera Consultants told Business Standard.
She explained that the current Optional Practical Training (OPT) pathway acts as a vital bridge, giving international students hands-on experience while they wait for their H-1B opportunity.
'Currently, OPT provides an invaluable platform allowing international graduates a chance to gain experiential learning while they wait for their H-1B chance. In the future, an entry-level candidate who is an international graduate from a US university may be treated unfairly when the lottery weights the permit toward advanced degrees, higher wages, and elite employers,' she said.
Big firms may benefit, startups could lose out
Some experts are concerned that a weighted selection could give large corporations an edge over startups and nonprofits.
'If the selection process prioritises employer size or wage levels, large corporations could dominate the pool. Startups and nonprofits—which often operate on lean budgets—may struggle to attract global talent,' said Tinwala.
He warned that this could have long-term effects on innovation and diversity in the US workforce.
The potential change may also push skilled Indians to explore other destinations.
'Canada and parts of Europe already offer more streamlined, merit-driven immigration systems. If the US process becomes harder to predict, highly skilled talent will simply go where they feel more welcome,' Tinwala said. 'We already see this reflected in the hiring patterns and career preferences of our candidates.'
A wake-up call for Indian students
Mamta Shekhawat, founder of study abroad platform Gradding.com, said the proposal could reshape the way Indian students choose universities and courses.
'We have witnessed how one policy shift abroad can impact every aspect of Indian education,' Shekhawat told Business Standard.
'The recent signal from the DHS to replace the H-1B lottery with a weighted selection process is not just technical fine print: it is a life-changing lever for Indian students, especially those eyeing the world's largest tech job market,' she said.
Giving an example, she added, 'A student deciding between a costly master's in data science at a US state school and a new AI/ML programme at IISc will now weigh not just tuition, but the odds of an H-1B. If the weighted system truly favours elite degrees and deep specialisation, IISc may suddenly become a smarter long-term bet.'
She also pointed out that students from lesser-known Indian colleges, once attracted to the randomness of the current system, might now opt for upskilling through Indian certifications and aim for multinationals building R\&D centres in India.
'We believe, in this new era, the calculus of worthwhile education and secure employment is being rewritten. Indian students are becoming more strategic, institutions more globally aware, and employers more selective,' Shekhawat said.
Growing support for reform in the US
Some observers in the US believe the current lottery-based system is no longer fit for purpose.
'The H-1B is the primary way through which the United States attracts high-skilled immigrants. That it is randomly allocated (among eligible applicants) is insane. America deserves better,' Connor O'Brien, research analyst at the Economic Innovation Group said in a social media post.
He argued on social media that giving away H-1B visas randomly was a wasted opportunity. 'Eliminating the H-1B lottery in favour of a system that prioritises higher earners first is a no-brainer,' he said.
Jeremy Neufeld, director of immigration policy at the Institute for Progress, a nonpartisan think tank, wrote in a January 2025 proposal by the IFP that the change could raise the programme's economic value without increasing the visa cap.
'Replacing the lottery could increase the economic value of the programme to the United States by 88%, equivalent to the effect on GDP of raising the cap by 75,000,' Neufeld wrote.
He added that the current system discourages employers from targeting particularly talented candidates, as there is no guarantee they'll secure a visa. He estimated that US employers spend more than $1.9 billion each year on recruitment efforts for H-1B applicants who ultimately don't get selected.
Call for clarity and fairness
For now, the random lottery remains in place. But experts say that if the new system is adopted, transparency will be crucial.
'People need to know how the system works and what counts. If it feels like a black box or favours only a few, it will lose credibility fast,' said Tinwala.
He added, 'That's why we emphasise outcome transparency with both candidates and recruiters—because trust drives long-term value. A well-designed system can reward skill and intent. But if it ends up privileging only power and money, it risks doing more harm than good.'