India’s WTO draft on services soft on work visas, social security fees

India’s proposed trade facilitation pact in services, submitted recently to the WTO, does not call for binding commitments in the two key areas of multiple entry work visas and social security payment exemption.

The proposal, a copy of which is available with BusinessLine, suggests a ‘best endeavour’ clause on both issues. This means that members will try their best to implement the proposals but will not be held accountable for it.

On the positive side, the draft legal text proposes tightly binding measures for cross-border transfer of information by electronic means, including personal information, for supplying services which, if implemented, could lead to greater flow of outsourced business to India. It also lays down that members shall develop a scheme for a GATS visa (services visa) applicable for categories of natural persons committed in their schedule of specific commitments.

The document will be discussed by the WTO Committee on Trade in Services on March 13-18. The draft is India’s answer to the Trade Facilitation Agreement in goods, which came into force last week, as New Delhi has argued that it is equally important to have a pact that facilitates international trade in services by smoothening procedures and norms.

“It will be interesting to see how various countries react to the draft text, though it should have been firmer in the areas of multiple entry visas for workers, social security agreements to exempt short-term workers and insurance portability. It is good that the proposals are binding on cross-border transfer of information though,” a Delhi-based trade expert told BusinessLine .

“The EU’s reaction to the proposal on cross-border transfers would be important, as it has been fiercely protective of data being transmitted to countries not on its data-secure list that has affected flow of outsourced businesses from European companies to countries such as India,” the expert added.

New Delhi has been pressing Brussels to include it in the list of data-secure countries so that European countries are confident about outsourcing business to the country. While it is one of its key demands in the bilateral India-EU trade pact under negotiation, the EU has been resisting taking on commitments on the matter.

The draft proposes fast-track procedures for authorisation and immigration formalities for service suppliers based on the criteria such as past track record. It also seeks reasonable and transparent fees and charges. This is important especially in the light of recent work visa fee hikes in the US.

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