EB-5: Attracting high net worth Indians who wish to move to the US
Posted on April 20, 2015
The US immigrant investor programme, or EB-5, which was created to stimulate the American economy through job creation and capital investment by foreign investors, is becoming increasingly popular with high net worth Indians who want to move to America.
The programme requires applicants to invest $1 million in new commercial enterprises in the US that create or preserve at least 10 full-time jobs for qualifying US workers within two years of the immigrant investor’s admission as a conditional permanent resident. Along with the investor, his/her spouse and unmarried children below the age of 21 years are also granted dependent immigrant visas. Further, under the EB-5 Pilot Programme, US companies engaged in big projects can register themselves with the immigration authorities and set up regional centres in which immigrant investors can invest.
For new commercial enterprises in remote or targeted employment areas, the investment required for EB-5 applicants is half-a- million dollars. Many HNIs from India are looking at EB-5 as a path to legal permanent resident status in the US to make personal and business investments there and to provide high-quality college and university education for their children. As permanent residents, the immigrant investors and their family members can live and work anywhere in the US and run their own proprietary businesses.
“There has been an upsurge of about 150% in the applications for EB-5 visas from India over the last few years. In 2014, the number of EB-5 applications filed from India went up to 96 from 38 in 2013. The applications are mainly from HNIs and professionals such as lawyers, doctors and architects,” says Pankaj Joshi, MD of NYSA, an investment advisory firm. In the last one year, NYSA has seen a 100% approval rate for EB-5 clients. “For parents looking to give their children a future in the US, the EB-5 programme provides an opportunity where they can get green cards for their children even before applying to American universities.
This allows the children to apply as domestic applicants where they are eligible for instate or domestic tuition fee and access to student loans,” says Joshi. Mumbai-based immigration lawyer Sudhir Shah, who has been working with EB-5 applicants from India for over six years, feels that when routing investments through regional centres, it is important to conduct a due-diligence exercise. “During my visits to USA every year, I go to different regional centres and meet the promoters, attorneys and financial advisors so that I can advise my Indian clients about them. Though there are almost 500 regional centres in the US, many are non-functional and not reliable,” says Shah. He adds that most of the 10,000 EB-5 visas available annually are snapped up by people from China with Indians still warming up to the programme.
“For many Indian investors, the return on investments is more important than the fact that they will receive a fast-track green card along with family members. Besides, some find it difficult to provide details about the source of their funds,” Shah adds. In comparison to similar investor immigration programmes provided by other countries, the US EB-5 is often seen as the most flexible one.
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