Employment in India

India is one of the fastest growing developing countries in the world, India has the potential and scope for exponential growth in the future and this has been identified by the various countries in the world. With increase in globalization and open borders there has been an increase in interest in India from everywhere around the world. A lot of services and manufacturing industries are investing heavily in India over the past few years and will continue to do so.

Growing interest in doing business in India has seen a rise in the number of foreigners traveling to India. Indian laws do not have restrictions on the number of foreign nationals that can work or do business in India, but regulate their entry, stay and movement in India. One should understand that the structure of the entity that wishes to employ a foreign national and the structure of the business entity are important when applying for business or employment visas which are subject to change from time to time. This article describes a few methods by which a foreign national can commence business or work in India along with an overview of appropriate visas.

The ‘Make in India’ initiative has lead to significant increase in inflow of foreign capital, FDI up to 100% is freely allowed in almost all the sectors in India except where the existing and notified sectoral policy does not permit FDI beyond a ceiling. This has lead to the increase in the number of people coming to India seeking employment.

The most common methods used by foreign nationals to set up a business in India include establishing a representative office, project office, branch office, incorporation of a wholly owned subsidiary or establishing joint ventures depending on the needs of the company. Approvals from various regulators is required before making investment like Reserve bank of India, FIPB approval (Foreign investment promotion board has been abolished in the 2017 budget and new framework is being prepared).

A liaison office is generally used to explore and understand the business environment and opportunities in India for a foreign parent entity. It cannot undertake any commercial activities. Foreign companies planning to execute specific projects in India can set up temporary project or a site office in India. Foreign entities engaged in manufacturing and trading activities abroad are allowed to set up branch offices for most purposes, including export and import of goods, rendering consulting services, conducting research among, many others.

Overview of Indian Business and Employment Visas

The Foreigner’s Act, 1946, The Registration of Foreigners Act, 1939 and The Citizenship Act, 1955, together with allied rules and periodic amendments regulate the foreigner’s entry, along with the immigration policy, movement and stay in India. Most foreign nationals entering India require a valid passport along with an appropriate visa depending on the motive of visit to India. Visa can be issued for the following purposes.

Business Visa: An individual seeking to travel to India on business should obtain a Business Visa. The validity of a business visa can range from 6 months to 10 years. Individuals who seek to establish a business in India may be eligible for a business visa, which is usually issued with a longer validity period (a long term visa). A business visa application should include supporting documents from the sponsoring organization(s).

Employment Visa: Generally, foreign nationals with high levels of professional skills and qualifications are granted visas to take up employment in India. The duration of the employment visa would depend on the period of employment contract depending on the kind of employment and the validity of the applicant’s passport.

Eligibility:

Following categories of foreign nationals are eligible for an Employment Visa:

1. Foreign nationals coming to India as consultant on contract for whom the Indian Company pays fixed remuneration (this may not be in the form of a monthly salary).

2. Foreign artists engaged to conduct regular performances for the duration of the employment contract given by Hotels, Clubs or other organizations.

3. Foreign nationals who are coming to India to take up employment as coaches of national/state level teams or reputed sports clubs.

4. Foreign sportsmen who are given a contract for a specified period by Indian Clubs/Organizations.

5. Self-employed foreign nationals coming to India for providing Engineering, Medical, Accounting, Legal or such other highly skilled services in their capacity as independent consultants provided the provision of such services is permitted under law.

6. Foreign language teachers/interpreters.

7. Foreign specialist chefs.

8. Foreign nationals deputed for providing technical support/services transfer of know-how/services for which the Indian company pays fee/royalty to the foreign company.

9. Senior management personnel and/or specialists employed by foreign firms who are relocated to India to work on specific project/management assignments.

Applicant should satisfy the following condition to be eligible:

• The applicant should be a highly skilled and/or qualified professional being engaged or appointed by a company/organization/industry/undertaking in India on contract or an employment basis at a senior level, skilled position such as technical expert, senior executive, or in a managerial position etc.
• The Employment visa can’t be granted for routine, ordinary or secretarial/clerical jobs.
• The employee’s salary must be in excess of U.S. $25,000 per year.

Validity:

Embassy/Consulate may grant employment visa, which is valid for an year irrespective of the contract. Further extension may be obtained from MHA/FRRO in the concerned state in India. The visa duration starts from the day of issuance and not from the day of entry in India. Foreign technician may get visa for period of five years or the bilateral agreement between Indian and foreign government whichever is less with multiple entries. For highly skilled IT person visa validity is upto 3 years with multiple entries. Others can be granted visa with validity of two years with multiple entries.

There is no prior petition or labor application. There is no restriction on the duration an individual can stay in India on a Business or Employment visa as long as the stay is in keeping with the visa that was issued initially. The visa needs to be extended from time to time.

Foreign nationals of certain countries may be subject to additional checks or restrictions pertaining to a visit or stay in India for e.g. Pakistan.

Spouse and children of a foreign national applying for an employment visa or a long term business visa are usually issued entry visas that are co-terminus with the principal applicant’s visa. It should be noted that most foreign nationals are required to register with the Foreigners Regional Registration Office (FRRO)/Foreign registration officer (FRO) within a stipulated period of 14 days after arrival into India or if they intend to reside in India for more than 180 days. Visas, once granted cannot generally be changed.

As the number of foreign investments into India increase the demand for the Indian visas is increasing. Going forward it might be necessary to impose some restrictions on the number of foreign nationals working in India to ensure that the local work force is not disadvantaged to avoid the situation in America right now (The American government plans on increasing the minimum salary requirement of the H1B visa to $130000 to increase employment for locals). However, it is unlikely that a developing country like India that is still dependant on Foreign Direct Investment for its growth and requires skills that are not available in India to sustain that growth will impose numeric restrictions on the visas in the near future.