As the world’s 11th largest economy with some for the highest economic growth rates in the world, the India recruitment market has gained strength since the 2008-2009 financial crises which slowed the Indian outsourcing and IT services sectors.
The Indian Diaspora, Non-resident Indian (NRIs) and Indian Returnees
Non-resident Indians (NRIs) describe members of the Indian Diaspora who were either born outside of India or were born in India but live outside the country while a Person of Indian Origin (PIO) describes someone of Indian origin who is not a citizen of India. In fact and after the Chinese, non-resident Indians (NRIs), Persons of Indian Origin (PIOs) and the Indian Diaspora is considered to be the largest Diaspora population in the world numbering over 30 million strong.
Aside from Nepal and Myanmar which border India, the United States, Malaysia, the UK and South Africa have the largest numbers of Indians permanently settled outside of India while various Middle East countries host large numbers of Indian guest workers. Otherwise, it’s worth noting that overseas Indians account for around 10% of Singapore’s population and 7% of Malaysia’s population along with a sizable percentage of the professional populations of these countries.
India is also ranked second after China for sending students to study abroad with most Indian students traditionally studying abroad in the United States (around 100,000+) followed by the UK (around 20,000), Canada and Australia. However, the study abroad patterns for Indian students have changed in recent years due to changes in visa policies. Specifically, the two-year post-study leave to remain in the UK has been scrapped for new non-EU students. Given that such programs are a popular way for self financed Indian students to earn back the costs of their education, Indian students studying abroad are increasingly looking at more visa friendly destinations (or countries with stronger economies) like EU countries (Germany in particular), New Zealand and Singapore as well as both Australia (now that the government has clarified student visas and clamped down on non-reputable institutions) and Canada (which offers pos-study work permits).
Moreover, a rash of high-profile incidents of fraudulent universities in the United States leaving Indian students stranded has left Indian employers skeptical about lesser-known US based education institutions. Likewise, visa difficulties and a tough US job market are sending Indian study abroad students who would normally want to study in the United States to consider educational opportunities elsewhere.
Meanwhile, members of the Indian Diaspora and British Indians in particular have been returning to India to take advantage of better career or investment opportunities as well as a much higher standard of living that senior managers and executives can enjoy when compared to life in the West.
To look after the affairs of Non-resident Indians (NRIs), Persons of Indian Origin (PIOs) and the Indian Diaspora in general, including Indian study abroad students, the government of India has created the Ministry of Overseas Indian Affairs whose website is intended to be a one-stop shop for news and information impacting overseas Indians.
The Indian Recruitment Market
The India recruitment market for outsourcing and IT services has largely recovered from the downturn that resulted from the 2008-2009 global financial crisis when Tier-I IT companies postponed hiring. Moreover, Indian job applicants are finding jobs easier to come by but largely without the double digit salary hikes that were common in the past.
It should also be noted that in the past when the US dollar was stronger, Indian returnees to India tended to want their compensation denominated in US dollars. However and when the US dollar began to weaken against the rupee, Indian returnees then began asking for compensation in rupees. Hence and when the option of being paid in dollars or being paid in rupees is available, Indian returnees will need to consider the current and forecasted dollar-rupee exchange rate.
Working in India
Descendents of overseas Indians can obtain work permits for India based upon their birthright under two different Indian government schemes: The Person of Indian Origin (PIO) Card scheme and its expected replacement, the Overseas Citizenship of India (OCI) scheme. For the purposes of issuing a PIO Card, the Indian government considers anyone of Indian origin up to four generations removed to be a Person of Indian Origin (PIO). PIO Card holders will not need a visa to visit, study or work in India but other restrictions and formalities may apply. For more information about the PIO Card, visit the PIO Card sections of the websites of immihelp.com or the Embassy of India Washington DC.
Under the Overseas Citizenship of India (OCI) scheme, a limited form of dual citizenship is allowed for both Non-resident Indians (NRIs) and Persons of Indian Origin (PIOs). Unlike the PIO Card which usually expires after 15 to 20 years, an OCI Card is good for life but a person who obtains one must be eligible to have dual citizenship under their other nationality. For more information about the OCI Card, visit the OIC Card sections of the websites of immihelp.com or the Embassy of India Washington DC.
Otherwise, foreign expatriates working in India must obtain an Indian work permit that will usually be valid for a period of one year or until the end of the contract for which the work visa is being obtained for. For more information about Indian work permits and Indian visas in general, visit the website of the Bureau of Immigration India.
As for taxes, Indian tax rates are progressive up to 30% (plus an applicable cess of 3% – specifically 2% for Primary Education Cess and 1% for Secondary Education Cess) plus Indian tax brackets will vary according to whether an individual is a resident male or female or over the age of 65. Generally speaking, residents of India will be taxed on worldwide income while persons not ordinarily resident in India will not pay taxes on income earned outside of India unless it is derived from a business that is controlled from within India or if the income is accrued or first received in India or it is determined to have been accrued in India.
Nonresidents in India are liable only for taxes on income sourced in India while an individual is deemed a resident of India if he/she spends at least 182 days in the country in any given year or just 60 days if the individual spent at least 365 days in India during the preceding 4 years. For those Indian citizens who leave India for employment or for an Indian citizen/person of Indian origin working abroad who visits India while on vacation, the threshold for the 5-year test will be 182 days in a given year rather than 60 days. In addition, a so-called “not ordinarily resident” individual will be someone who has either not been a resident in 9 out of the 10 preceding years or who has been in India for less than 730 days during the preceding 7 years. For further information about India tax rates or Indian taxes in general, visit taxrates.cc, KPMG’s Taxation of International Executives page for India or the website of the India Income Tax Department.
India Recruitment and Jobs Resources
For additional India recruitment resources, check out the India tagged posts from our Brain Drain to Brain Gain blog as well as our India jobs page.