I INTRODUCTION TO THE IMMIGRATION FRAMEWORK
This chapter addresses several new issues of practical concern in view of the increase in immigration of multinational business executives into India. The aim is to highlight key business immigration issues regarding foreign personnel who seek relocation in India, conditions to be complied with for short-term engagement of foreign nationals by Indian firms and companies, taxation of foreign nationals in India, legal provisions prohibiting dual nationality, provisions relating to newly introduced overseas citizenship and the penal consequences arising from violations by business personnel in the context of immigration law requirements. In addition, we refer to the newly delineated persons-of-Indian-origin and overseas-citizens-of-India schemes. Persons of Indian origin resident overseas qualifying in these two categories can derive immense benefits if they want to work in India. Towards the chapter's conclusion, a case has been made for India to have a new set of consolidated rules focusing exclusively on business immigration into India, and also for the introduction of a work permit scheme in the face of changing market conditions.
India clearly remains an attractive destination for foreign investors. The United Kingdom and the United States are among the top 10 foreign investors in India, and increasing numbers of their citizens are coming to India for business reasons. The recent massive liberalisation of the Indian economy has promoted innumerable joint ventures, which involve the movement of workers, machinery and technology. This chapter seeks to update immigration practitioners advising business personnel on relocation to India. In addition, brief reference is made to the extension and variation of business visas (B visas), foreign exchange regulations, citizenship in India and questions of dual nationality.
i Legislation and policy
The principal Indian legislation regarding foreigners is contained in the Foreigners Act 1946 (the 1946 Act), which also provides for framing of relevant rules regulating the registration of foreigners. The 1946 Act also stipulates strict formalities with regard to the presence and movement of foreigners in India and their subsequent departure. Section 3 of the 1946 Act details the objectives of this enactment and provides as follows.
The provisions contained in the above-mentioned legislation make it quite clear that unfettered powers have been conferred on the Indian government to regulate the movement and presence of foreigners in India. It appears that, historically, the prime concern has been safeguarding the interests of national security. Furthermore, Section 6 of the earlier Registration of Foreigners Rules 1939 (the 1939 Rules) details relevant procedures for the registration of foreigners visiting India. Under Rule 6(1)(b), a foreigner entering India on a valid visa for more than 180 days should present the registration report as specified by the registration officer at the port or other place of arrival.
Rule 6(2)(b) of the 1939 Rules provides that this registration report shall be presented within 14 days of the foreigner's arrival in India. Under Rule 6(3), every foreigner, in addition to presenting a registration report to the registration officer, is duty-bound to furnish any relevant information in his or her possession to satisfy the registration officer of the authenticity of the particulars provided. The foreigner must also sign the registration report, and is then entitled to receive a certificate of registration from the relevant officer. Pakistan nationals are, however, required to register within 24 hours of their arrival.
Under Rule 9 of the 1939 Rules, every registered foreigner is legally obliged to produce his or her certificate of registration within 24 hours of a demand being made by any registration officer, magistrate or police officer for the purpose of inspection, although discretion is given to the officer concerned to extend the time. It is also incumbent on returning foreign visitors, under Rule 15 of the 1939 Rules, to surrender their certificate of registration prior to departure. Visiting foreigners who contravene any of the directions incorporated in the certificate of registration render themselves liable to penalties prescribed under Section 14 of the 1946 Act.
The rigour of the penal consequences under the 1946 Act was highlighted by the Supreme Court of India in 1955 in the matter of Hans Muller v. Superintendent Presidency Jail.2 It was held that:
The Foreigners Act confers the power to expel foreigners from India. It vests the Central Government with absolute and unfettered discretion and, as there is no provision fettering this discretion in the Constitution, an unrestricted right to expel remains.3
The relevant law was subsequently discussed in an important case, which reflects the particular security concerns of Indian officials when dealing with Pakistani citizens. It was held in Khalil Ahmad v. State of UP, reported in AIR 1962 Allahabad 383:
It is true that there is no specific rule for obtaining a 'permit' by a foreigner from the Registration Officer, but it may be implied from the fact that every foreigner entering India is required to present in person to the Registration Officer a registration report of his or her arrival in India, on the basis of which he or she is granted a certificate of registration duly endorsed by the Registration Officer. This certificate of registration is nothing more than a 'permit' issued to the foreigner indicating the date of his arrival and the period during which he is permitted to stay in the country.4
The Supreme Court's position in Hans Muller v. Superintendent Presidency Jail was followed by the Calcutta High Court in AH Magermans v. SK Ghose.5 In this case, the petitioner had failed to get himself registered anywhere in India in accordance with the 1939 Rules, nor had he filed any application for extension of his visa. Accordingly, it was held that the order of deportation did not suffer from any infirmity. The High Court of Himachal Pradesh, in Fred Howard Haering v. State of Himachal Pradesh,6 reiterated the aforementioned three rulings.
ii The immigration authorities
In the case of a foreign employee or a business visitor, the grant of a visa is at the discretion of the relevant Indian foreign embassy or consulate overseas. No judicial review application is sustainable against refusal of an employment visa (E visa) to a foreign national, as also discussed below.
Reporting compliance to the Foreigners Regional Registration Office (FRRO) assumes significant importance once the long-term employee has actually arrived in India.
Generally, the local district magistrate or the Senior Superintendent of Police exercises the designated powers of the FRRO under the Registration of Foreigners Rules 1939. In the case of the extended stay of all foreign employees in India of more than 180 days, the registration certificate should be obtained within 14 days of the foreigner's arrival under Section 6 of the Registration of Foreigners Rule 1939. This is akin to a residence permit. The rigours of non-compliance in terms of registration with the FRRO on the part of foreigners staying in India for more than 180 days are very rigid and entail serious penal consequences, such as a fine or imprisonment, or both.
The restrictions on the employment of foreigners are contained in Section 10 of the Foreigners Order of 1948.
Risks of using a B visa instead of a work visa
The consequences of undertaking employment on a B visa can be serious. This is a very common practice, even among very senior-level foreign managers from leading multinationals, especially software companies, who initially come to India to explore the market and then want to stay on for longer periods of time on an employment basis.
The real practical problem lies in conversion of the B visa application into a work visa application. This process is carried out by the Ministry of Home Affairs at New Delhi. It is at this stage that the immigration officers and the Deputy Home Secretary in charge of immigration issues can raise a serious objection to granting permission for the conversion of the application from a B visa to an E visa. The primary objection is that the applicant cannot engage in employment on the strength of a B visa. In addition, serious objections are raised over violation of taxation provisions. Quite often, when foreign employees are visiting India on a B visa, but are in fact in the full-time regular employment of their parent company while looking after the Indian operations, they generally do not pay taxes in India. So, in effect, this becomes an issue for the immigration officer at the Ministry of Home Affairs in New Delhi at the time of the conversion or extension of the visa application of the overseas employee already present in India. Although the immigration officer may overlook this aspect of the matter, it cannot be guaranteed; neither can it be used as a precedent.
In addition, because of the plethora of legislation with regard to entry, movement and presence of foreigners in India, as is the case with tax evasion, there is a risk of criminal liability for engaging in employment on the strength of a B visa.
In summary, it is not advisable to engage employees while the foreign employee is actually present in India on a B visa.
Notably, however, business visas should be non-convertible and non-extendable beyond five years from the date of their issuance. At the time of issue of business visas, Indian missions or posts must make it mandatorily clear to the foreigner that a business visa cannot be converted to any other kind of visa during his or her stay in India except in the following circumstances and only with the prior approval of the Ministry of Home Affairs:
- a business visa can be converted to an entry visa (X) if a foreigner who has come to India on a business visa marries an Indian national during the validity of his or her visa and does not intend to continue on business visas, subject also to the intention of cohabiting and security clearance;
- a business visa, in the case of designated persons of Indian origin, who is otherwise entitled to an X visa but has entered into India on a business visa, can also be converted to an X visa; or
- business visas of a foreigners who falls ill after entry into India rendering him or her unfit to travel and require specialised medical treatment may be converted to a medical visa if he or she is eligible for a medical visa and a medical certificate is obtained from the government or a government-recognised hospital.
iii Exemptions and favoured industries
The Indian immigration authorities and the Ministry of Home Affairs, which also looks at immigration policy issues, do not maintain any preferred shortage of occupation list for issuing work visas for any particular business or industry. However, ad hoc policies, strictly limited in scope and nature, have been formulated for very short periods by the Ministry of Home Affairs in the past, purely to fill specialist demands in certain industries. As an example, a few years ago the Ministry of Home Affairs granted E visas to pilots from foreign countries on account of the acute shortage of pilots faced by the private airlines operating in India. This occurred about five years ago on account of the boom in the Indian aviation industry. Another prominent example concerned infrastructure projects. In 2008, India issued large numbers of B visas to Chinese nationals: 69,084, compared with 58,046 in 2007. Until June 2009, at least 32,700 Chinese nationals had been issued B visas. This was a short-term measure for specialist low-level workers of foreign origin for infrastructure projects in the power, telecoms, and oil and gas sectors. This was in spite of the requirement for E visas.
II INTERNATIONAL TREATY OBLIGATIONS
India became a signatory to the General Agreement on Tariffs and Trade (GATT) on 8 July 1948, and on 1 January 1995 became a member of the World Trade Organization when it replaced GATT as the organisation overseeing the multilateral trading system.
India is not a signatory to any specific international agreement or convention facilitating movement of inbound and outbound skilled or unskilled workers, either for employment or business purposes. There are no treaties of any sort or protocol arrangements entered into by India with neighbouring countries to promote cross-border movement of people, for work purposes or otherwise. Rather, on account of the prolonged historical unrest with some neighbouring countries, it is very difficult even to obtain visas to visit India, let alone to set up or recognise any sort of treaty rights with some neighbouring countries for the grant of employment or B visas. Likewise, Indian nationals experience similar problems with some neighbouring countries.
III THE YEAR IN REVIEW
The past year has seen two very significant, much awaited and positive changes in Indian immigration law to keep pace with fast-changing contemporary global market conditions. The first is a very liberal expansion of the locus standi of the concept of e-visas. The expansion of the concept has been a runaway success – much more than could have been anticipated given that it stands in marked contrast to the traditional mould of immigration law. The second aspect warranting due consideration and appreciation is the efforts of the government to introduce the concept of the permanent-residence status scheme; this is the first time an investment-based scheme has been proposed in the Indian immigration arena.
i Non-maintainability of judicial review proceedings (in India or elsewhere) against refusal of E visas by the Indian High Commission overseas
In November 2010, in the case of Appellants: Stelmakh Leonid Iuliia v. Respondent: Secretary to the Ministry of External Affairs, Government of India and Union of India,7 the High Court of Bombay refused to entertain a writ petition under Article 226 of the Constitution of India seeking judicial review of a refusal of an E visa application of an applicant based in Ukraine. She was promised employment as an analyst by JPMorgan Services India Private Limited in Mumbai.
It was contended on behalf of the Union of India that, pursuant to the policy framed by the government of India, the petitioner was not entitled to an E visa. According to the existing policy, employment in India can be given only to those foreigners who have specialised education in a particular field and who can be appointed to a special post only in situations when Indian citizens are not available for appointment in that post.
In relation to the maintainability of the writ petition, the Court held that the real question requiring consideration was whether such petitions are maintainable in the instance of a foreign national and whether the issue in question can be said to be justiciable.
The upshot of this significant ruling is carved out in Paragraphs 7, 9 and 11 of the judgment, which read as follows:
7. It is pertinent to note that so far as foreign nationals are concerned, all the fundamental rights enshrined in the Constitution of India are not available to them except Articles 21 and 14 of the Constitution of India. In our view, it is not a fundamental right of a foreign national to get an employment visa in India. If the visa is rejected on the basis of a policy framed by the Government of India, this Court cannot sit in appeal over such a decision in order to find out as to whether the visa application should have been granted or not. In our view, asking for visa by a foreign national cannot be said to be a justiciable issue and this Court cannot issue any writ under Article 226 of the Constitution of India in connection with the availability of fundamental rights where a foreign citizen is concerned.
. . .
9. So far as the right to get a visa is concerned, in our view, it is not a fundamental right of a foreign national and, therefore, the petition under Article 226 of the Constitution of India, violating such a right is not maintainable. So far as Article 14 and 16 are concerned, Article 16 relates to equality in the matter of public employment and a non-citizen cannot invoke Article 16 in any manner as the said Article is only applicable to the citizens of the country. It cannot be said that there is violation of Article 21 of the Constitution in the present case, nor any such argument is canvassed before this Court. Considering the said aspect, in our view, this petition cannot be entertained, which challenges the decision of the Indian Embassy rejecting an employment visa to the petitioner. It is not for this Court to find out whether such a restriction in the matter of granting a visa to a foreigner is proper or not.
. . .
11. . . . In our view what should be the guidelines for giving a visa is a matter which is solely in the discretion of the Government of India in its department of External Affairs. This Court cannot decide the issue as to what policy should be framed for granting an employment visa or other visa. This Court cannot lay down any criterion in this behalf in any manner. Similarly this Court is not expected to decide as to whether the visa application should be allowed or not. Rejection of visa by the Consulate is not an issue which is a justiciable one. If the Government of India in its wisdom has taken a decision by prescribing certain criterion, this Court cannot take a judicial review in such a matter. It is always open to the State to restrict the entries of foreign nationals by imposing restrictions by framing certain policy and the said policy decision should not be interfered with. As pointed out earlier only few fundamental rights like Article 21 of the Constitution of India are available to the foreign nationals and Article 16 cannot be said to be applicable to the foreign nationals for getting public employment in this country. In our view, in the instant case, no relief can be granted to the petitioner in view of what is stated hereinabove. It cannot be said that there is a violation of Article 21 in the present case. The petitioner has no right to approach this Court and it cannot be said that income criterion prescribed by the Government of India is arbitrary in any manner, which issue cannot be decided at the instance of the Petitioner, who is not an Indian citizen. We accordingly do not find any substance in the petition.
However, despite the substantial foreign direct investment that has come into India (which continues to be the case at the time of writing), there is very little reported case law by the higher judiciary in India relating to refusals of business visitor visas or E visas for foreign employees based outside India.
ii Developments regarding foreign employees
Quota regime abolished
In 2010, the government of India issued guidelines stipulating that E visas should be issued by Indian missions abroad only to skilled and qualified foreign personnel, and only in situations where workers with the requisite skills are not available in India.
Subsequently, a further notification was issued by the Directorate General of Employment and Training at the Ministry of Labour and Employment, which for all practical purposes is akin to the quota system recently introduced by the British government. The upshot of these guidelines was that the issuance of E visas was curtailed to 1 per cent of the total number of workers working in a company, with a minimum of five workers and a maximum of 20 workers, except in the power and steel sectors; in this particular case, the maximum limit was temporarily increased to 40 workers until June 2010. This ceiling on foreign workers was causing tremendous problems to foreign multinationals in India with a large number of expatriate senior level personnel heading their foreign direct investment operations throughout the territories of India. The notification also had a caveat providing that all foreign applicants in this situation would be entitled to apply for E visas beyond the stipulated limit of 20 foreign employees per organisation or establishment provided there was a bona fide business requirement. However, the difficulty was that the decision-making power in this matter did not lie with the Indian embassy, diplomatic mission or consulate overseas. All such applications in excess of the quota had to be vetted by the Directorate General of Employment and Training before permission was granted. This led to bureaucratic delay at the governmental level in India. Given the huge number of requests that came from different jurisdictions worldwide, the resulting delay in clearing these applications certainly did not have a positive impact on foreign companies and organisations wanting to conduct business in India. Accordingly, the government of India rethought the strategy and the notification imposing caps on numbers has now been withdrawn. The government has instead introduced a basic salary threshold (briefly discussed below). Importantly, there are no conditions stipulated by the Indian Immigration Law for creating a minimum number of jobs in any business investment made in India by a person or an enterprise from overseas.
Minimum salary threshold introduced by the government for foreign nationals
India is an emerging economy that is attracting many young professionals who want to come here to experience a different work culture and way of life. Often they are willing to work for salaries that are much lower than those in their own countries.
The Indian government had set a salary threshold limit of US$25,000 a year for foreign nationals being sponsored by employers in India for an E visa from November 2010. Different countries have different ways to protect their own workers, and the Indian government has chosen this route instead of imposing numeric caps.
Introduction of project (P) visas by the government
Even though the Indian government has no plans currently to increase the categories under which the lower salary threshold will be relaxed for E visa applicants, the P visa category within the E visa regime has provided big benefits for the power and steel sectors.
Under the P visa, foreign nationals can come to India for the execution of projects in the power and steel sectors. The visa is project-specific but is not subject to the lower salary ceiling.
Not surprisingly, there is a huge demand for P visas; according to figures from the Ministry of External Affairs, 1,000 P visas for the power sector and 400 for the steel sector had been issued within a year of the category being introduced.
iii Visa restrictions on foreigners
On 3 December 2012, the government eased its restrictions on tourist visas, which had previously mandated a two-month gap between consecutive visits by foreign nationals.8 India introduced an electronic visa facility for 44 countries in November 2014, which is applicable to visitors travelling to India for recreation, short-duration medical treatment and business visits, for stays of 30 days. It is available at nine airports: Delhi, Mumbai, Bengaluru, Chennai, Kochi, Goa, Hyderabad, Kolkata and Thiruvananthapuram.
The decision to review the visa restrictions was taken by the Prime Minister's Office (PMO) in January 2012 following concerns raised by the Ministry of Tourism that the negative perception associated with the move had affected the number of tourists coming into India.9
The PMO asked the Ministries of Home Affairs and External Affairs to review the restrictions, including the possibility of bringing in more countries under the visa-on-arrival scheme, and improving conditions at major airports.
As a consequence, the Ministry of Home Affairs issued an order dated 23 November 2012 stating that:
The provision relating to the two-month gap between two visits of a foreign national to India on a tourist visa has been reviewed by the government. It has now been decided . . . to lift the restriction of two-month gap on re-entry of foreign nationals coming to India.10
Foreign exchange earnings from January 2012 to October 2012 amounted to 742,150 million rupees with a growth rate of 22.1 per cent over the past year, when earnings were 607,800 million rupees.11
Industry watchers are hoping that the lifting of the 60-day restriction will encourage foreign tourists to visit India, and to use the country as a hub while visiting South East Asia and neighbouring countries.
Immigration, visa foreigners registration and tracking
To strengthen the existing immigration system, there has been a modernisation programme, the mission mode project on Immigration, Visa and Foreigners Registration and Tracking (IVFRT), which has been undertaken by the Ministry of Home Affairs and the Bureau of Immigration of India, with the assistance of the central government organisation the National Informatics Centre). Under the said project, all the Indian missions, Immigration Check Posts and FRRO offices are being computerised and networked to develop a secure and integrated delivery framework to facilitate genuine and legitimate travellers.
Under the new IVFRT system, more than 80 per cent of Indian diplomatic missions, hotels in most Indian cities, and travel agents have been networked. This, in turn, is linked to the advance passenger information system used by airlines. All these are connected to all immigration posts and key foreigners registration offices (FROs) that attract maximum numbers of the foreign population.
As a result, a huge database has been created, with information on every foreigner entering India; a unique case file for each foreigner contains passport details, and all data on past travel, stays, pattern of visits and any observations made by law-enforcing authorities anywhere in the country is available. The data is stored in three places in Delhi and Bangalore. This, sources say, has made taking decisions on visas quite efficient.12
iv E-visa scheme and visa on arrival for Japanese nationals
Background to the e-visa scheme of India
The Indian government introduced an e-tourist visa scheme on 1 January 2010. It was initially tried as a pilot visa-on-arrival project for citizens of five countries. Subsequently, a year later, it was extended to include a total of 11 countries. And, from 15 April 2014, it was extended to include South Korea. This visa-on-arrival scheme was replaced by an online e-visa system, effective from 27 November 2014. The system has been implemented in phases and was initially made available as an e-tourist visa to citizens of 100 countries, including the 12 countries previously eligible for a tourist visa on arrival.
The introduction of the e-tourist visa facility was a step towards easing the official procedure for entering India. With the aim of boosting the tourism sector and to give a fillip to the Make in India programme, the government of India extended the e-tourist visa facility to 37 more countries, with effect from 26 February 2016, allowing 150 countries to make use of the e-tourist visa service.
The government decided to liberalise further the e-visa regime from 1 April 2017 by, among other things, broadening the scope of the e-visa into three categories: e-tourist visa, e-business visa and e-medical visa.13
Eligibility conditions for the e-tourist visa
The e-tourist visa is issued subject to certain conditions. For ease of reference, the following eligibility criteria apply for e-tourist visa applications:
- International travellers whose sole objective in visiting India is recreation, sightseeing, a casual visit to meet friends or relatives, medical treatment for a short duration or a casual business visit are eligible.
- The visitor's passport should be valid for at least six months from the date of arrival in India. The passport should have at least two blank pages for stamping by the immigration officer.
- International travellers should have a return ticket or onward journey ticket, with sufficient money to spend during their stay in India.
- International travellers holding a Pakistani passport or of Pakistani origin may apply for a regular visa at the Indian mission.
- The e-tourist visa is not available to diplomatic or official passport holders.
- The e-tourist visa is not available to individuals endorsed on a parent's or spouse's passport (i.e., each individual should have a separate passport).
- The e-tourist visa is not available to international travel document holders.
Application procedure for the e-tourist visa
The general procedure for applying for an e-tourist visa is as follows:
- application is made online by uploading a photo and a copy of a passport page;
- payment of the visa fee is made online using a credit or debit card;
- the e-tourist visa is provided online via email; and
- applicants must print the e-tourist visa and carry it with them when travelling to India.
However, there are instructions, restrictions, conditions and caveats regarding applications for e-visas, which should be complied with by prospective and potential foreign travellers choosing to exercise this option, including the following:
- Applicants should carry a copy of their electronic travel authorisation (ETA) with them at the time of travel; they should confirm that their ETA status is shown as 'granted' prior to commencement of the journey. Applicants can track the status of their application online.
- Applicants' biometric details are mandatorily captured at immigration control on arrival in India.
- The e-visa is non-extendable, non-convertible and not valid for visiting protected, restricted or defence areas. To visit these areas, permission is required from the relevant civil authority.
- Extra caution has to be exercised while paying the e-tourist visa fee. If the applicant makes more than three unsuccessful payment attempts, the application ID will be blocked and the applicant will be required to apply afresh by filling in the application form again and generating a new application ID.
- Before reapplying, applicants are requested to wait for four hours after final submission of the application form and payment of the fee for payment status to be updated. The payment status may take up to four hours to update.
- The e-tourist visa facility is provided in addition to the existing visa services.
It is important to note that the initial online application process has to be complied with in letter and spirit, and if this is not observed, 'the overseas traveller is most likely to be deported upon arrival' to his or her country of origin or travel destination.
Implementation of e-visa scheme for tourism, business and medical purposes with effect from 1 April 2017
Key visa reforms introduced by the government last year include the following:
- The window for applications under the e-visa scheme has been increased from 30 days to 120 days and the duration for stay on e-visas has been increased from 30 to 60 days with effect from 1 April 2017.14
- The e-visa has been subdivided into categories (i.e., e-tourist visa, e-business visa and e-medical visa). Foreigners are permitted to combine these categories to travel to India.
- Separate immigration counters and facilitation desks to assist medical tourists have been provided at six major Indian airports.
- A new category of visa, titled Intern (I) Visa, has been rolled out for foreigners intending to pursue internship in India.
- Documents to be uploaded mandatorily by the e-visa applicant required include:
- a recent front-facing photograph with white background; and
- a copy of the passport photo page containing personal details (name, date of birth, nationality, expiry date, etc). In addition, depending upon the e-visa type, one more document may also be required to be uploaded. If the uploaded documents and photograph are not clear or do not meet the specification, they are liable to be rejected by the authorities.
- The e-visa fee is country- or territory-specific. Additional bank transaction charges of 2.5 per cent will be charged on applicable e-visa fees. The fee must be paid at least four days before the expected date of travel otherwise the application will not be processed. Notice of the fee amount will be available on the e-visa application website.
- Upon urgent requests, e-business and e-medical visas will be granted within 48 hours of application, which is a very good facility for senior-level executives wanting to visit India at very short notice for urgent business meetings.
- The e-tourist visa facility has now been extended to the nationals of 161 countries for entry through 24 airports and three Indian ports. Although foreigners can exit from any of the authorised immigration control points in India, in practice, entry on e-tourist visas through non-designated airports will not be permitted at all.
- According to the amended guidelines applicable from 1 April 2017, double entry is permitted on e-tourist and e-business visas. Triple entry is permitted on e-medical visas at multiple points.
- Visitors can avail themselves of the e-visa facility a maximum of two times in a calendar year (i.e., between the months of January and December).
The phenomenal success of the e-visa facility following this expansion is evident from the very large numbers of visitors who have used the scheme; so much so that it was recently reported in one of the leading national newspapers, The Hindustan Times (5 April 2018), that the number of Britons opting for e-visas to visit India has increased exponentially since the e-visa was first introduced in the United Kingdom, jumping from 82,751 applicants in 2015 to 327,798 in 2017.15
v New policy on the cards to boost medical tourism
The Indian government plans to bring out a policy to promote India as a key destination for medical tourism. The proposed policy would promote integrated treatment with allopathy, ayurveda, yoga, unani, siddha and homoeopathy (collectively, AYUSH) streams.
Medical tourism in India is projected to amount to a US$9 billion opportunity by 2020, with the national industry currently worth US$3 billion. Globally, the medical tourism market is estimated to be worth around US$40 billion to US$60 billion. In view of these prospects, the Indian government has taken several steps to ease travel processes and promote medical tourism.16
The Ministry of Commerce and Industry, along with the Ministry of Tourism and the Ministry of Health and Welfare, has already launched an online portal17 in three languages – Arabic, Russian and French – to provide comprehensive information to medical travellers.
Experts say India is emerging as one of the most credible destinations worldwide for curative treatment. Given the scale of its healthcare infrastructure and projected growth, India can further strengthen its standing among the currently popular medical-value tourism destinations, such as Thailand, Singapore, Malaysia and Mexico.
A recent 'knowledge paper' by the Federation of Indian Chambers of Commerce and Industry and Quintiles IMS shows over 5,00,000 foreign patients seek treatment in India each year. South Asian Association for Regional Cooperation countries such as Bangladesh, Afghanistan and Maldives are the major sources of medical-value travel, followed by African countries such as Nigeria, South Africa and Kenya. Proximity, cultural connections and connectivity are the key reasons for the inflow of patients to India from these regions.
Several steps have been taken by the government to ease travel processes and promote medical tourism, including making the process for the issuance of medical visas much more efficient, thus reducing the time taken for visa procurement. The scope of the e-tourist visa has also been expanded to include short-term medical treatment.
vi Reciprocity and catalyst to investment: business visas on arrival for Japanese nationals with effect from 1 March 2016
Japan and South Korea are already on the list of 150 countries whose citizens can arrive in India using the e-tourist visa platform. In December 2015, during Japanese Prime Minister Shinzo Abe's visit to India, the Prime Minister of India announced a liberalised visa regime for all Japanese citizens. The Prime Minister of India acknowledged that Japan had earmarked an US$11 billion–US$12 billion fund for the Make in India manufacturing and governance programme.18
The business visa-on-arrival facility has now been extended to Japanese nationals through Circular No. 467, issued by the government of India, Ministry of Home Affairs, Foreigners Division, with effect from 1 March 2016. A new Chapter 3B in the Visa Manual pertaining to visas on arrival has been added.
The visa on arrival for Japanese nationals will be issued in tourist, business, conference and medical categories for a validity of 30 days. However, Japanese nationals will be given a visa on arrival in India in any of the six designated airports – Delhi, Mumbai, Kolkata, Chennai, Bengaluru and Hyderabad.
This visa-on-arrival facility offered to Japanese nationals is in addition and further to fast-track progression to the common e-tourist visa facility offered to citizens of 150 other countries. To apply for an e-tourist visa, a foreign national has to follow the above-mentioned online process. However, the crucial distinction is that Japanese nationals will be exempted from the online process with effect from 1 March 2016, should they voluntarily decide to do so with a view to exercising the option of the visa-on-arrival facility on Indian soil, but only at the select six designated airports, and, of course, with regard to compliance with the requirements of immigration.
However, it was specifically stated in Circular No. 467 that this visa-on-arrival facility was only to be extended to Japanese nationals who were unable to apply for a regular visa or e-tourist visa for some reason. At the same time, the Circular recommended that, to avoid the longer procedure and uncertainty, Japanese nationals should potentially make use of the e-tourist visa facility.
The Ministry of Home Affairs guidelines came into force on 1 March 2016.
It is clear that this red-carpet treatment is to facilitate and attract more significant inward foreign investment from Japan.
vii New horizons: permanent residency for foreign investors on the radar
The Union Cabinet under the chairmanship of the Prime Minister has approved the scheme to grant Permanent Residency Status (PRS) to foreign investors19 subject to the relevant conditions as specified in the FDI policy notified by the government from time to time. This is the first time an investor category has been introduced in Indian immigration law.
The scheme is expected to encourage foreign investment in India and facilitate the Make in India programme. Under the PRS scheme, suitable provisions will be incorporated in the visa legislation to provide for the grant of PRS to foreign investors.
The PRS will be granted for a period of 10 years with a multiple-entry facility, which can be renewed for another 10 years if the PRS holder has not come to adverse notice. The scheme will be applicable only to foreign investors fulfilling the prescribed eligibility conditions and his or her spouse and dependents. To qualify for this scheme, the foreign investor will have to invest a minimum of 10 million rupees within 18 months or 25 million rupees within 36 months. Further, the foreign investment should also generate employment for at least 20 resident Indians every financial year.
PRS will serve as a multiple-entry visa without any period-of-stay stipulation and PRS holders will be exempted from registration requirements. PRS holders will be allowed to purchase one residential property for dwelling purpose. The spouse or dependents of the PRS holder will be allowed to take up employment in the private sector (which is a relaxation of the salary stipulations for the E visa) and undertake studies in India.
viii The Citizenship (Amendment) Act 2019
The Citizenship Amendment Bill 2019 received assent in the Lok Sabha on 11 December 2019 and the Rajya Sabha passed the legislation on 12 December 2019. The Bill also received the assent of the President of India and was notified by publication in the Gazette of India Extraordinary on the same day. The Citizenship (Amendment) Act 2019 was brought into force by a notification on 10 January 2020 published in the Gazette of India Extraordinary. The validity of the amended Citizenship Act 2019 has been challenged in a batch of 60 petitions, which are pending hearing in the Supreme Court. On 18 December 2019 the Supreme Court issued notice in all 60 petitions. However, no stay of the provisions of this amended Act was granted by the Supreme Court as it was brought to the notice of the Court that the necessary enabling rules in support of the amendments have not yet been notified. These petitions raise issues regarding violations of Articles 14, 21 and 25 of the Constitution of India and incompatibility with the secular character of the country, as it has been averred that people of Muslim religion have been excluded from being beneficiaries of the Citizenship (Amendment) Act 2019.
In effect, the Citizenship (Amendment) Act 2019 seeks to add a proviso to the definition of the term 'illegal migrant' under Section 2 of the Citizenship Act whereby Hindus, Sikhs, Buddhists, Jains, Parsis and Christians from Afghanistan, Bangladesh and Pakistan will not be treated as illegal migrants under the Citizenship Act. Further, it seeks to reduce the number of years of residence in India required for citizenship by naturalisation for the above-mentioned communities, from eleven years to five years. However, as noted above, the implementing rules for the Act have not been notified, therefore the amendments are not actually functioning yet. Moreover, the challenge to the amended Act impugning its constitutional validity is pending in the Supreme Court, the outcome of which has yet to be decided.
In sum and substance, the Act grants Indian citizenship to Hindus, Christians, Sikhs, Buddhists, Jains and Parsis who came to India from Afghanistan, Pakistan and Bangladesh before 31 December 2014. Hence, people of these religions from these three countries will have an opportunity to obtain Indian citizenship, even if they do not have requisite documentation in support of their claims. Furthermore, such people will not be deported for not possessing documents proving their Indian citizenship, as they will not be treated as illegal migrants. The criticisms of this Act come from people professing the Muslim religion, of whom there is no mention and who have been excluded from the purview of the amendment specifically.
Another notable feature of the Citizenship (Amendment) Act 2019 stipulates that an Overseas Citizen of India (OCI) cardholder's registration shall not be cancelled unless the cardholder is granted a reasonable opportunity of being heard by the competent authority. This will promote fairness and adherence to principles of natural justice before cancellation.
IV EMPLOYER SPONSORSHIP
The law in India distinguishes between unskilled workers, generally referred to as 'workmen' in terms of the Industrial Disputes Act 1947, and highly skilled managerial workers in supervisory positions. Most of India's employment and labour laws apply only to workmen. 'Workmen' are defined as individuals who are employed to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for remuneration. A person is classified as a workman based on his or her actual duties and not merely his or her job description. The following are not workmen: individuals who render services in a managerial or administrative capacity, and individuals who are employed in a supervisory capacity and draw a higher salary.
Applicability of domestic law to foreign nationals
The employment and labour laws do not distinguish between nationals and foreign nationals, and the legal protection applies equally. A foreign national working in India can choose whether Indian laws apply to him or her if he or she works for a subsidiary of a foreign parent company or he or she works for short or long periods with an employer in India.
Irrespective of the foreign national's choice, his or her Indian employer continues to be liable for, and must fulfil its obligations regarding, statutory benefits under applicable Indian laws (if the foreign national meets the eligibility criterion entitling him or her to these benefits).
Reference to the provisions of the Indian Information Technology Act 2000
It is also important to refer to the provisions of the Indian Information Technology Act 2000. The purpose of the Act is to foster an environment in which laws are simple and transparent and in which the advantages of new technologies can be tapped. This Act proposes facilitation of electronic commerce transactions, electronic filing, maintenance of electronic records and electronic government transactions.
Geographical and territorial jurisdiction of the Information Technology Act 2000
Section 1 of this Act states that this legislation extends to the whole of India and also applies to any offence or contravention committed outside India by any person.
Section 75 provides that the nationality of the accused is irrelevant if the act or conduct constituting the offence or contravention involves a computer, computer system or computer network located in India.
The Act also deals with issues subsidiary to this secure electronic environment, such as privacy and contraventions relating to electronic transactions and information technology offences. It also seeks to set up various authorities to help regulate an information technology regime.
The Act not only lays down new substantive law, but also makes incidental and consequential amendments to the Indian Penal Code 1860, the Indian Evidence Act 1872, the Bankers' Books Evidence Act 1891 and the Reserve Bank of India Act 1934.
ii Work permits
The key features of an E visa are as follows:
- E visas are granted to foreigners who wish to come to India for the purpose of employment.
- Applicants should be skilled and qualified professionals, or persons who are being engaged or appointed by a company, organisation, industry or undertaking, etc., in India on a contract or employment basis at a senior level, or alternatively in skilled positions, such as technical experts, senior executives or in a managerial position.
- E visas are not granted for jobs where large numbers of qualified Indians are available.
- E visas are not granted for routine, ordinary, or secretarial or clerical jobs.
- E visas are issued from the country of origin, or from the country of domicile of the foreigner, provided the period of permanent residence of that applicant in that particular country is for more than two years.
- Indian companies or organisations engaging foreign nationals for executing projects or contracts must be responsible for the conduct of the foreign nationals during their stay in India and also for the departure of these foreign nationals upon expiry of the visa.
- It is mandatory for the foreign national concerned to comply with all other statutory requirements, such as payment of tax liabilities.
- E visas are initially granted for up to one year but extensions are permitted up to a maximum of five years from the date of issue of the E visa.
- It is mandatory for E visa holders to register with the relevant FRO or FRRO within two weeks of the date of arrival. This is a very important requirement – failure to register entails very serious consequences.
Significantly, the government of India has started issuing long-stay visas and work permits to refugees recognised by the UN Human Rights Convention.
The foreign national must have a valid travel document, a re-entry permit, an employment or engagement contract and documentary proof of his or her educational qualifications and professional expertise. Practical experience suggests that for both categories of the above-mentioned visas, the documentation should be as comprehensive as possible.
iii Labour market regulation
Restrictions on the employment of foreigners
The power to grant or refuse permission for foreigners to enter India and subsequent restrictions on employment have been provided in the Foreigners Order of 1948 (the 1948 Order).
Further, Section 10 of the 1948 Order places restrictions on the employment of foreigners in public sector undertakings. It states that no foreigner shall, without the written permission of the civil authority, engage in employment in any public sector undertaking the supply of electricity, power, water and petroleum products. It is clear from this that protection of matters of national importance and security are of paramount concern. Expatriates cannot occupy key positions in public sector undertakings, as they can in Dubai.
Section 10 of the 1948 Order has to be read in conjunction with the provisions of the Foreign Exchange Management Act 1999, which came into force on 1 June 1999. This consolidates and amends the law relating to foreign exchange with the objective of facilitating external trade and payments, and of promoting the orderly development and maintenance of a foreign exchange market in India. The Act also applies to all branches, offices and agencies outside India when owned or controlled by a person resident in India, and also to any contravention thereunder committed outside India by any person to whom the Act applies.
The requirements regarding business and E visas as stipulated by the government of India are discussed below.
iv Rights and duties of sponsored employees
Limited rights are available to foreigners, as elaborated in the recent Bombay High Court judgment of Stelmakh Leonid Iuliia of 2010, discussed in Section III.
v Duties of foreign employees
Taxation of foreign nationals in India
The liability for income tax for all persons staying in India depends primarily on their 'residential status' as stipulated in the Indian Income Tax Act 1961.
If a foreign citizen is resident in India, all income received, accrued or created by him or her in India and abroad (total world income) shall be subject to tax in India. If a foreign national is not resident in India, then only income received, accrued or created by him or her in India shall be taxable. Rigorous consequences follow in cases of tax violations by foreign personnel, which can also create serious problems when extensions of visas are sought within India or at the Indian diplomatic mission overseas. Certain tax exemptions are available to foreign diplomats or consuls and in certain limited situations.
Under the provisions of a double taxation avoidance agreement, a foreign national can generally claim credit for taxes paid in India against any income tax liability in the country of his or her habitual residence.
The list of relevant legislation as applicable to foreign personnel is endless. Also important is compliance with the provisions of the Indian Companies Act 1956 and the provisions of the Foreign Exchange Management Act 2000. The applicability of other relevant legislation depends on the nature of employment of the foreign employee with regard to particular facts and circumstances of each case.
vi Change of employer for an E visa holder
An E visa holder, who needs to change his or her employer once in India has to apply to the Ministry of Home Affairs (MHA) for approval. The MHA may, on the basis of the merits of each case grant the change of employer, but this can be done only once during the five-year tenure of the original E visa.
The MHA would consider approving the application in the following circumstances:
- where the applicant is a foreign national who holds a senior position or is a highly skilled person within an organisation in India;
- where the applicant is a foreign national changing employment between a registered holding company and its subsidiaries; or
- where the company that originally employed the foreign national is prepared to issue a no-objection letter.
Converting an X visa into an E visa
An X visa is granted to the spouse of a foreign national employed in India. Generally an X visa holder is not allowed to work to generate any income while in India by way of employment, commerce, business or any other economic activity. However, the MHA now allows an X visa holder to convert the visa into an E visa within India provided that:
- the X visa holder has accompanied his or her spouse, who has a valid E visa; and
- the X visa holder independently qualifies for an E visa.
The Ministry of Home Affairs may take up to three months to process these documents.
vii Acquiring citizenship in India
It is not easy to acquire Indian citizenship. Section 5 of the Indian Citizenship Act 1955 provides for citizenship by registration, while Section 6 of the Act provides citizenship by naturalisation. There is no concept of long-term residence for foreign employees or foreign investors under the immigration laws of India.
V INVESTORS, SKILLED MIGRANTS AND ENTREPRENEURS
i B visas and E visas
The key features of a B visa are as follows:
- B visas are normally granted to foreign nationals who want to visit India to establish or explore possibilities to set up industrial or business ventures in India.
- B visas are not granted for the business of money lending, petty trading or full-time employment in India.
- B visas are granted with multiple entry facilities for up to five years, although a stay stipulation may be prescribed for each visit by the Indian mission concerned.
- B visas are normally granted to persons of assured financial standing and expertise in the field of the intended business.
- B visas are issued from the country of origin, or from the country of domicile where the foreign national has been a permanent resident for more than two years.
- The foreign national must comply with all other statutory requirements, such as the payment of tax liabilities.
Regarding main supporting documentation, the foreign national must have a valid travel document and a re-entry permit, if required under the law of the country concerned, and proof of financial standing and expertise in the field of intended business. All business-related correspondence should be appended in support of the application.
Government attitude to conversion of B visas into E visas
In the past decade it had become very common for senior and mid-level executives, employees and managers of foreign companies, such as consulting companies, banks, foreign multinationals and computing companies from overseas, to send their employees to explore the market conditions in India with a view to starting business operations. However, what actually happened in practice was that business people came to India and, after looking at the favourable economic climate, commenced fully fledged business operations on the strength of their B visas. Technically, this was clearly in outright breach of the immigration laws. These foreign personnel on Indian soil would subsequently seek to have their B visas converted into E visas. The government is attempting to reduce the bureaucratic hurdles for senior foreign workers seeking to vary their leave to remain.
As previously noted, however, business visas should be non-convertible and non-extendable beyond five years from the date of their issuance.
Visas – foreign nationals of Indian origin
Foreign nationals of Indian origin can visit India on a multi-entry visa when they hold a letter of intent, an acknowledgement of an industrial entrepreneur's memorandum, a licence or provisional registration with the State Directorate or Commissioner of Industries, etc. These people can obtain endorsements on their passports for single or multi-entry visas from the Consulate General, High Commissioner or Embassy of India. Their spouses can also be granted multi-entry visas for up to five years.
B visas can also be converted into E visas, but it is not that easy in practice, because prior permission has to be obtained from the Ministry of Home Affairs in New Delhi. This requirement cannot be waived under any circumstances.
ii Non-resident Indian community schemes
Persons of Indian Origin Scheme
The Persons of Indian Origin (PIO) Scheme was formulated by the government of India in 1999 and was subsequently revised in 2002. The real benefit to PIO cardholders is that they were entitled to visit India without a visa for 15 years from the date of issuance of the PIO card and were exempted from registration at FROs as long as their stays in India did not exceed 180 days.
In 2003, the Indian Citizenship Act 1955 was amended to include provisions relating to OCIs. OCI cardholders are entitled to a lifelong multipurpose, multiple entry, which allows them to visit India at any time, for any length of time and for any purpose. They are also exempted from reporting to the police for any duration of stay in the country.
Merger of the two schemes
Much to the delight of the Indian community resident overseas, in October 2014, PIO cardholders were granted lifetime validity for entry in India and an exemption from reporting formalities, the benefits of which are similar to those offered under the OCI card scheme. In fact, both of these schemes were the government of India's response to the demands of the non-resident Indian (NRI) community to introduce dual nationality, which has never happened, primarily because of security concerns.
On 6 January 2015 the Citizenship (Amendment) Ordinance 2015 was promulgated by the Ministry of Law and Justice to amend the Indian Citizenship Act 1955. Consequently, the Ministry of Home Affairs issued a press release and notifications on 9 January 2015 of the change. Pursuant to this Ordinance, the PIO scheme will cease to be in force and the provisions relating to the OCI scheme will constitute the sole immigration regime pertaining to OCIs.
The Ordinance aims to simplify and consolidate the immigration rules for the non-resident Indian community. The rights and benefits available to OCI cardholders will now be extended to existing PIO cardholders. Accordingly, apart from other benefits, existing PIO cardholders will be exempt from various procedural requirements, such as registration with FROs and police reporting requirements. All persons of Indian origin who wish to travel to India may apply for an OCI card to access the benefits available to OCI cardholders. This move by the government has had a high uptake by the Indian community resident overseas.
Amendments to the Citizenship Act 1955 and stipulated criteria for OCI cardholders 2015
Section 7A of the Citizenship (Amendment) Act 2015 provides the eligibility criteria for registration of an individual as an OCI cardholder. Upon making an application, the central government will register individuals if they are:
- of full age and capacity and are:
- a citizen of another country, but were a citizen of India at any time on or after the commencement of the Constitution;
- a citizen of another country, but were eligible to become a citizen of India at the time of the commencement of the Constitution;
- a citizen of another country but belonged to a territory that became part of India after the 15 August 1947; or
- a child, grandchild or great grandchild of one of the above-mentioned citizens;
- a minor child:
- of a person at (a) above; or
- whose parents are both citizens of India, or one parent is a citizen of India; or
- spouses of foreign origin of citizens of India or spouses of foreign origin of OCI cardholders registered under Section 7A, and whose marriage has been registered and subsisted for a continuous period of not less than two years immediately preceding the presentation of the application under Section 7A (and subject to security clearance by the relevant authorities in India prior to registration).
It is also important to note that any person who is or was (or either of whose parents, grandparents or great grandparents is or was) a citizen of Pakistan or Bangladesh cannot be registered as an OCI cardholder under the Act. (See also, Section III.viii, on changes to be introduced under the Citizenship (Amendment) Act 2019.)
Rights of OCI cardholders
With the merger of the PIO and OCI schemes in the OCI cardholder scheme, the rights provided under the two schemes are now available to OCI cardholders. According to the Ministry of Home Affairs, registered OCI cardholders are entitled to the following rights:
- lifelong multiple-entry visa for visiting India for any purpose, with the exception that OCI cardholders must obtain special permission to perform research work in India and may have to submit an application to the applicable Indian embassy or FRRO;
- exemption from registering with the FRRO or FRO for any period of stay in India;
- parity in respect of all the facilities available to non-resident Indians (NRIs) in economic, financial and educational fields; however, this right is not available in matters relating to the acquisition of agricultural or plantation properties;
- parity with NRIs regarding inter-country adoption of Indian children;
- parity with resident Indian nationals on matters pertaining to tariffs on Indian domestic-sector air fares;
- parity with domestic Indian visitors regarding entry fees applicable when visiting national parks and wildlife sanctuaries in India;
- parity with NRIs regarding:
- entry fees levied when visiting national monuments, historical sites and museums in India; and
- carrying on the following professions in India, in accordance with the provisions contained in the relevant legislation: doctor, dentist, nurse, pharmacist, advocate, architect and chartered accountant;
- to take various tests, such as the All India Pre-Medical Test, to be eligible for admission in accordance with the provisions contained in the relevant legislation;
- OCI cardholder registration booklets are recognised as suitable identification to show eligibility for any services provided by state governments;
- to specify that a particular or specific address be treated as their place of residence in India, subject to provision of an affidavit attested by a notary public as proof of residence;
- to specify their overseas residential address as their place of residence, also by an affidavit, and to specify their email address, if any; and
- any further benefits as notified by the Ministry of Overseas Indian Affairs under Section 7B(1) of the Citizenship Act 1955.
Note also that a person registered as an OCI cardholder is eligible to apply for grant of Indian citizenship under Section 5(1)(g) of the Citizenship Act 1955 if he or she is registered as an OCI cardholder for five years and has been ordinarily resident in India for 12 months before applying for registration.
Registering for Indian citizenship
The Amendment Act has modified certain provisions pertaining to citizenship by registration. Pursuant to the Act, any individual who is not an illegal migrant or not already a citizen of India can make an application to the central government. For the application to be granted, the applicant has to fulfil the following criteria. Pursuant to Section 5 of the Act, the applicant has to be:
(a) a person of Indian origin who is ordinarily resident in India for seven years before making an application for registration;
(b) a person of Indian origin who is ordinarily resident in any country or place outside undivided India;
(c) a person who is married to a citizen of India and is ordinarily resident in India for seven years before making an application for registration;
(d) minor children of persons who are citizens of India;
(e) a person of full age and capacity whose parents are registered as citizens of India under clause (a) of this sub-section or sub-section (1) of section 6.
Pursuant to the Amendment Act, the following provisions have also been added:
(f) a person of full age and capacity who, or either of his parents, was earlier citizen of independent India, and is ordinarily resident in India for twelve months immediately before making an application for registration;
(g) a person of full age and capacity who has been registered as an Overseas Citizen of India Cardholder for five years, and who is ordinarily resident in India for twelve months before making an application for registration.
Dual citizenship is still not recognised in India and, hence, to obtain Indian citizenship individuals will have to renounce their existing citizenship. In addition, a person will also be eligible to apply for citizenship if he or she has been residing in India but has travelled abroad intermittently, if the total number of days that person has stayed away from India does not exceed 30 days. This provision has been made to meet the needs arising out of increased globalisation, which necessitates people travelling abroad for economic, social and medical reasons. Also, if satisfied that the circumstances are of a special nature, and after recording these in writing, the central government can relax certain criteria imposed under Section 5(1A) of the Act.
Decision to convert PIO to OCI
According to the Citizenship Amendment Act 2015, all PIO cardholders are 'deemed to be' OCI cardholders with effect from 9 January 2016. However, the Act did not specify that the cards will need to be changed. This has led to serious implementation issues with the PIO–OCI merger, resulting in much confusion at Indian embassies and immigration points abroad; also, PIO cards will not be compatible with the card-reading machines to be installed at Indian airports soon.
The Indian government, therefore, announced the decision to convert PIO cards to OCI cards before 31 December 2016. This deadline was recently extended to 30 June 2017 without any penalty. (See also, Section III.viii, on changes to be introduced under the Citizenship (Amendment) Act 2019.)
VI OUTLOOK AND CONCLUSIONS
Opportunities are plentiful in India because of a number of factors, including the following features of the country:
- a fast-moving economy;
- high-profile software projects;
- IT parks;
- private equity and IPOs;
- a property boom;
- foreign direct investment;
- its position as a global centre for healthcare;
- developing trade opportunities and avenues for professionals created by globalisation; and
- the return of NRIs with funds for investment in India.
Safeguarding the interests of national security remains the prime concern of the stringent legislation and judicial decisions pertaining to the entry, presence and movement of foreigners in India, including business visitors. At the same time, the Reserve Bank of India closely monitors all inward and outward financial remittances undertaken by expatriate foreign personnel and cross-border business transactions of foreign establishments operating from India.
There is still a crystal-clear case for framing a new set of consolidated rules focusing exclusively on business immigration into India, which should replace the existing outdated and rigid provisions, and despite some of the major changes introduced in 2017. The two highlights of 2017 (i.e., expansion of the ambit and locus standi of e-visas and the government contemplating launching a PRS scheme linked to locked-in investment over a certain period) are not exactly enough given current market conditions and the amount of massive inward investment that has taken place in India, which warrants a huge inflow of foreign personnel and especially a very senior-level white-collar workforce.
The present immigration requirements certainly remain unconducive to the substantial foreign direct investment continuously and rapidly taking place in India. For the past several decades, the government has steadfastly taken great care in suitably updating the rules regarding foreign equity investment into India, while the business immigration provisions have been completely ignored. As in the EU, safeguarding freedom of movement for goods and capital is one thing; facilitating the free movement of business personnel is another. In addition, we do not operate 'trusted trader' or 'smart gate' programmes, or the IRIS system, between India and any other Member State.
Along with the government's expansion of the scope and locus standi of the e-visa regime, the newly amended regime has extended the facility of the e-visa on arrival to a broad range of nationals from 161 countries, for entry through 24 airports and three designated seaports.20 From the business point of view, the objective of these changes is to make India an attractive destination for foreign direct and portfolio investment.
Outside the arena of corporate immigration, there are other contemporary issues relating to inbound immigration that warrant immediate attention, such as the new breed of foreign lawyers undertaking transactional work in India on behalf of multinationals, often referred to as 'laptop lawyers'. The question remains: can they be treated as business visitors, given the fact that they get paid to accompany their foreign clients who are visiting India for work? India was previously a major hub for commercial surrogacy arrangements. There are no provisions for situations such as these in the existing immigration rules.
It is time for the government to introduce a work permit regime for foreign nationals wanting to set up businesses in India and run offices on behalf of multinationals. All global giants now have a presence in India as they are tapping into the cheap labour market. Sadly, their entry is unrestricted and without financial cost. More importantly, the fees for processing work permit applications could be a source of revenue for the exchequer.
Lastly, Brexit has not yet had an impact on the government's policies on inward-bound immigration and it is too early to predict what its effect is likely to be.
1 Ranjit Malhotra and Anil Malhotra are managing partners at Malhotra & Malhotra Associates.
2 Calcutta, reported in AIR 1955 SC 367.
3 Hans Muller v. Superintendent Presidency Jail, p. 374.
4 Khalil Ahmad v. State of UP, reported in AIR 1962 Allahabad 383, p. 390.
5 AIR 1966 Calcutta 552.
6 AIR 1996 HP 27.
7 In writ petition No. 1648 of 2010 and chamber summons No. 334 of 2010, decided on 25 November 2010.
8 The tourist visa restriction was introduced in November 2009 in the aftermath of the Mumbai terror attacks, when it was found that Pakistani–American David Coleman Headley had succeeded in breaching security measures to visit India several times over a period of three or four years.
9 India's share of international tourist arrivals in 2011 was a mere 0.64 per cent. According to the latest data, foreign tourist arrivals to October 2012 showed a marginal increase of 6.2 per cent compared with 2011.
10 However, nationals of Afghanistan, Bangladesh, China, Iraq, Iran, Pakistan and Sudan, and foreigners of Pakistani and Bangladeshi origin and 'stateless persons', will continue to come under the 60-day gap rule.
11 Statistics reported in the Times of India, 4 December 2012, http://articles.timesofindia.indiatimes.com/2012-12-04/india/35593489_1_tourist-visa-tourist-arrivals-visa-on-arrival-scheme.
12 For details see the Sunday Express, 12 February 2014, http://indianexpress.com/article/india/india-others/intel-nod-for-visa-on-arrival/.
14 For more details see The Indian Express, 1 April 2017.
18 For more details see The Hindu, 1 February 2016.
20 For more details see Express Network, 1 April 2017.