India in visa clampdown on foreign workers

NEW DELHI: Thousands of foreign workers in India face a deadline Saturday to be out of the country in a visa clampdown aimed at cracking down on tax-dodging expats and unskilled labour.

The changes will affect expatriates working in India on a business visa, which under the new rules will be reserved for a smaller pool of senior executives, trade consultants and other specialists.

Those who fail to meet the government's new criteria for the business visa will have to leave India by Saturday midnight and can return to the country to work only if they meet the stricter criteria for a full employment visa.

"If a foreign national is employed in India, he must have the right kind of visa," Home Secretary G.K. Pillai said in New Delhi this week.

The number of expatriates affected by the change was not known, but experts said they expected thousands to be caught in the net.

Viral Thakkar, a partner at global consultancy firm KPMG in Mumbai, said he saw the stricter rules as aimed at keeping foreigners out of semi-skilled jobs.

"It is more of a restriction on semi-skilled labour coming to India," Thakkar said.

Immigration lawyer Poorvi Chothani also said the changes in the rules were to target tax-evading foreigners.

Earlier, business visas were given to a wider range of occupations and employees were allowed to come for six months without paying taxes.

"The problem comes when companies bring in people and send them back within six months and then get a new batch of people. As a result the government gets nothing," said Chothani of the Mumbai-based LawQuest legal firm.

"It is a corrective measure because why leave a very large tax-escape window open?" added Anjan Roy, economic adviser to the Federation of Indian Chambers of Commerce and Industry, a national business lobby.

Under the amended rules, foreign clerical, secretarial and unskilled workers will not be given work visas in India, where economists say unemployment and under-employment is rampant.

Employment visas will not be "granted for jobs for which large numbers of qualified Indians are available," the Home Ministry said.

Indian media reports have said the clampdown will specially hit around 25,000 Chinese with business visas who currently work in power, communication and petroleum sector projects in India.

In the northern state of Himachal Pradesh a major road project has come to halt after Chinese employees working for the contractor had to return home.

"The road is in a complete mess," complained top farmers' leader Sanjay Chauhan after around 100 Chinese workers abandoned the project.

Relations with China have lately been strained by an escalating border row.

"I understand why the Indian government wants to make the change," said Peter Linford, South Asia trade commissioner at the Australian High Commission in New Delhi.

He said some expatriate workers were using business visas when they should have been on employment visas.