July 9, 2010

The Ministry of Home Affairs in New Delhi has backtracked on its quota system.  The ceiling on employment visa applications for companies hiring foreign nationals in India, only introduced in 2009, has been removed for all industry sectors. The required $25,000USD annual salary level has also been removed.  Additionally, the renewal process in major cities has been simplified.  However, some new requirements have been introduced for Foreigners’ (Regional) Registration Office [(F(R)RO] registrations.

QUOTA REMOVAL 

The quota was introduced in July and October 2009, and limited the issuance of employment visas to a maximum of 1% of the total persons employed on a project, within an overall limit of 20 employment visa holders.

The overall limit was subsequently increased, in December 2009, to 40 for employers in the Steel and Power Industry.  In May 2010, (see our Global Briefhere) the quota was relaxed for Information Technology (IT) and IT enabled services (ITes) industries – the relaxation has now been extended to all industries.

IMPROVED RENEWAL PROCESS

Employers in India will be pleased to hear that the renewal process in India in major cities has been simplified.  Effective immediately, applications submitted to Foreigners’ Regional Registration Offices (FRRO) will now be approved for a maximum of 12 months.  Previously, an initial period of three months was given, with the subsequent nine months granted subject to Ministry of Home Affairs approval.  This new system will expedite the renewal process in major cities.

Improved Renewals – Who Benefits?

It is important to note that only Foreigners’ Regional Registration Offices (FRROs) have the authority to grant the full 12 month renewal.  Foreigners’ Registration Offices (FROs) in smaller cities may still only grant an initial three months, pending Ministry of Home Affairs approval for the remaining nine months.  FRRO offices exist in New Delhi, Mumbai, Chennai, Amritsar and, since January 2010, Bangalore.

NEW F(R)R O REQUIREMENTS 

However, it is not all good news.  Some additional requirements for F(R)ROregistration have been introduced, as follows:

  1. For renewals, a police report from the region where the applicant has been residing, is now required.  Note that this is not a crime clearance – the report is a confirmation that the applicant has been residing at a certain address.  Pro-Link GLOBAL is able to assist with obtaining the reports on behalf of our clients.
  2. In Mumbai, the F(R)RO has requested that all applicants who have registered with a temporary address (for example, a hotel) and have since moved to long term accommodation, should report the new details to the F(R)RO.  Again, Pro-Link GLOBAL can assist with this.
  3. In Hyderabad, the F(R)RO has requested that applicants submit their tax card (Permanent Account Number, or PAN, card), issued by the Income Tax Department as one of the supporting documents for F(R)RO registration.  This is an existing requirement in Chennai.

ACTION ITEMS FOR EMPLOYERS 

  • Note that, effective immediately, quotas have been removed for all industry sectors;
  • Renewal processes in major cities will be processed more quickly due to the new system; however, do please still initiate renewals with Pro-Link GLOBAL in good time;
  • Ensure that your employees in Mumbai are aware that they must inform you, and Pro-Link GLOBAL, if they move address;
  • Ensure that employees in Hyderabad and Chennai apply for their income tax (PAN) cards immediately post-arrival so that they can complete F(R)RO registration.

Caveat Lector | Warning to Reader 

This is provided as informational only and does not substitute for actual legal advice based on the specific circumstances of a matter. Readers are reminded that Immigration laws are fluid and can change a moment’s notice without any warning. Please reach out to your local Pro-Link GLOBAL specialist should you require any additional clarification.

Pro-Link GLOBAL worked with pur PLG|KGNM correspondent office in India to provide this Global BRIEF alert to you.