Prime Minister Malcolm Turnbull has announced the Coalition is abolishing the 457 visa system, which will be replaced with two new classes of visa.
The program will be replaced by another visa program, with new restrictions.
Indians looking for skilled worker visas to countries like Australia and the United States will no longer have it easy.
The Department of Immigration and Border Protection confirmed that existing visa holders would not be affected by the change, and would be accommodated for under the reform.
"India provides the highest number of temporary skilled workers to Australia of any country; eight out of the top 10 occupations for Indian 457 visa holders (as at December 2016) were IT professionals", Australian High Commissioner Harinder Sidhu said in a release.
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A new two- or four-year temporary visa "designed to recruit the best and the brightest" will still allow businesses to "get access to the skills they need to grow and invest", he added.
There are 95,000 workers on 457 visas at the moment - less than one per cent of the workforce.
"In many cases (the 457 visa) results in a migration outcome, that is, someone going into permanent residency and becoming a citizen, which is a significant attraction of the 457 visa", he told the press.
The list for the longer visa will be even more strict, said Immigration Minister Peter Dutton.
The country issued 45,400 457 visas last fiscal year, and including family members there are 94,890 people holding them, according to the Australian Broadcasting Corp.
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The 457 visa, which runs for up to four years, is now used by 95,000 foreign workers.
Prime Minister Malcolm Turnbull made the announcement today, saying the move is aimed at giving priority for jobs to Australian workers. As per them, there would be heavy skill shortage now, as Australia has limited talent, and the gap between demand and supply is huge. The list of occupations that qualify for the new visa will be sharply reduced.
However, 457 visa applicants who lodged their application on or before April 18, 2017 may be eligible for a refund of their visa application.
A second four-year visa will require a high standard of English language and a criminal check.
The programme has become mired in controversy with allegations the visa was being misused by employers to import workers on the cheap, not to fill genuine skill shortages.
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