The new visa rules imposed by the United States after the September 11, 2001 terror attacks on grounds of security against terrorists, is dissuading thousands from coming to the country, hitting industry, research universities, medical institutions, multinational corporations and the travel industry.

Because of the new regulations, American universities have lost students and scholars; corporations have suffered production delays, friction with customers and personnel problems; and foreign tourists and conventioneers have decided by the thousands to take their business elsewhere, the Washington Post said in a report on Tuesday.

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Increasingly, says the Post, US leaders in education, business and science are warning that the procedural obstacles thrown up to screen security threats have fostered a bureaucratic 'culture of no' that discounts the benefits that foreigners bring to the US.

Many critics also caution that by requiring foreigners to wait weeks or months for visas, Washington is damaging its efforts at public diplomacy.

However, Janice L Jacobs, deputy assistant secretary of state for visa services, defends the new rules saying: "In the post-9/11 environment, we do not believe that the issues at stake allow us the luxury of erring on the side of expeditious processing."

Figures reveal the impact of the restrictions. In fiscal 2001 (ending September 30, 2001) there were 10.5 million non-immigrant visa applications and 7.6 million visas were issued.

In fiscal 2003, the number of non-immigrant applications was down to 6.9 million and the number of visas issued was 4.9 million.

Deploring the state of affairs, Democratic Congressman Henry Waxman said, "Our commercial, research and scientific institutions have always benefited from the open exchange of people, knowledge and ideas. We need to protect ourselves. But we don't want to go too far and lose the rewards of an open society."

The number of Federal Bureau of Investigation checks went up from 140,000 in fiscal 2001 to 250,000 in fiscal 2003.

From January 5, there will be more checks. The government intends to fingerprint all visa-bearing travellers who arrive at airports and seaports.

Next October, visitors who do not require visas -- mostly people from Western Europe and Canada -- will have to have machine-readable passports.

In addition, people issued non-immigrant visas abroad will be finger-printed when obtaining visas.