For Asian ‘investors’, EB-5 visa opens doors to El Dorado
With fluctuating H-1B visa concerns, more Asian ‘investors’ are taking the EB-5 visa route to the US. The Chinese are way ahead of others but Vietnamese and Indians are also increasingly flocking to America which, they think, is their El Dorado.
Under the EB-5 visa rule, the US virtually takes a ‘loan’ from these investors who can have it ‘reimbursed’ after getting a Green Card!.
After China and Vietnam, India is the third largest investor in the US by way of the EB-5 visa. Indians filed 354 applications last year under this rule which at the minimum investment amount will result in the ‘flight of capital’ to the tune of $177 million.
Under the existing EB-5 visa rules, an ‘investor’ is required to commit funds equivalent to $500,000 (about ₹3.22 crore) of legally-earned money, choose a regional centre and a project which could employ at least 10 people. S/he also needs to hire an attorney to review the source of funds intended to be invested. After due diligence, the applicant can invest the funds in the project. And after getting a Green Card, the investor can expect to receive the funds back.
The EB-5 visa route is seen as one of the fastest qualifying processes to gain permanent residency for the investor, his/her spouse, and unmarried children under 21 years of age.
An EB-5 visa holder does not require visa sponsor or H-1B work visa for employment. He/she can directly apply to organizations as a US permanent resident which promises higher job security and opportunities as compared to an H-1B visa holder. An entrepreneur with an EB-5 visa gets easier access to resources such as capital, land and labour in the US to start a business.
This year, the Trump Administration is mulling to raise the ‘investment’ amount significantly as it considers it a money spinner.
But this long and expensive procedure does not generally disappoint the determined souls. As many as 13,516 Chinese emigrated to the US under the EB-5 visa in 2015-16; their number, however, plummeted to 10,948 in 2016-17. The Vietnamese, against whom the US fought a long war from 1955 to 1975, no longer see in America their mortal enemy: their number increased from 288 (2015-16) to 404 (2016-17).
The Indians come next: their number increased from 239 to 354 during the period, an increase of 48%. This year, the number is expected to be around 500, said an expert. “If the investment amount does not increase, the number would be much higher.”
The Chinese seem to migrating to the US to keep the wealth they have earned, apart from political reasons, and more and more Chinese students are flocking to America, he said.
“CanAm Investor Services alone attracted 47 investors from India in 2016 and nearly 100 in 2017. Seeing the spike in Indian applications, we are going to open an office in Mumbai soon, Abhinav Lohia, Vice-President, India & Middle-East, CanAm Enterprises, USA, told BusinessLine. His US-based firm has been in this business since 1994.
CanAm Investor Services, LLC, receives EB-5 applications from young educated professionals aged between 25-35 years as well as many upper class parents from Tier 1 and 2 cities who want their children to settle in the US for further education and lucrative career opportunities. Out of the above mentioned categories, Indian parents and their children comprise more than 50% of applicant numbers followed by young professionals and HNIs, he said.
In India, he said, the target audience includes high net-worth investors and their family through a one-time investment opportunity. A significant number of applicants includes IT professionals (10-15%), doctors and financial professionals.
“So far, CanAm has raised $ 2.5 billion and has also refunded $ 900 million to the investors who invested in 32 projects,” Lohia said. Gujaratis comprise 10-15% of Indian applicants. “Unlike the earlier chain-migration, the Gujaratis are now waking up to the idea of getting a Green Card through the EB-5 investment route. Most of these applicants come from Ahmedabad, Rajkot and Navsari.” he added.
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