India, Netherlands Sign Social Security Pact

Outlook

22 October 2009

http://news.outlookindia.com/item.aspx?668204

India and The Netherlands today signed a social security agreement that will benefit their workers and provide for cooperation in areas of labour market expansion and orderly migration.

Under the pact, workers on short term contracts of up to five years will not be required to make any social security contribution in the country of employment provided they continue to make social security payments in the country of their origin.

The pact was signed by Minister for Overseas Indian Affairs Minister Vayalar Ravi and Minister of Social Affairs and Employment of The Netherlands Piet Hein Donner.

Describing the agreement as a "significant step forward" in further enhancing ties with the European nation, Ravi said the pact will benefit workers in each other's country.

"The agreement will enhance cooperation on social security between the two countries and indirectly will trade ties," he told reporters.

Donner said his country would like to see deeper bilateral cooperation with India. "We hope movement of professionals between the two countries will now increase."

There are over 21,000 Indians in The Netherlands and there are over 850 Dutch nationals working in India.

India has signed similar pacts with Switzerland, Belgium, France and Germany in the recent past.

Officials of the Ministry of Overseas Indian Affairs said the workers sent by Netherlands-based companies to their Indian subsidiaries or those sent by Indian companies to their branches in The Netherlands will be exempt from social security contribution in the host country for a period of 60 months.

They said while working abroad, these employees will only be subjected to the social security regulations of their home country.

India is also holding talks with the US for a similar social security pact.

Social security agreements eliminate double payment on social security contribution, exempt detached workers from host country legislation and enable portability of pension and prevent loss of benefits.

The officials said one of the priorities of the government is to diversify the overseas destination base for Indian workers and secure labour markets for them in the emerging job opportunities across the globe.