THE SSA between India & Japan, which was
signed in 2012, is all set to come into force. The
Implementing Arrangement under the SSA and the Administrative Arrangement
for implementation of the agreement between the two countries were exchanged
on 9th June 2016. Earlier today the two sides have exchanged Note Verbales
in accordance with Article 28 of the Agreement notifying the completion
of the respective constitutional and legal procedures required for the
entry into force of the Agreement. The Article 28 also mentions that the
Agreement shall enter into force on the first day of the fourth month following
the date of receipt of last notification. Therefore, the Agreement on Social
Security between India and Japan shall enter into force with effect from
1st October 2016.
The
key benefits of such agreements are:
-
Once an SSA
is signed between India and a foreign country, it exempts the Indian worker
(working on short term contracts abroad) from making a social security
contribution in that foreign country. This exemption is provided only if
the Indian worker is covered under the social security system of India
and continues to pay his/her contribution during the period of overseas
contract.
b) Easy remittance of benefits (Exportability): An SSA between India and
a foreign country enables the Indian worker/professional to remit his/her
accumulated social security contribution made in a foreign country, in case
of relocation to India/third country.
c) Aggregating the contribution periods (in two countries) to prevent loss
of benefits (Totalization): An SSA allows aggregating residency periods of
social security contribution made by the Indian worker/professional in India
and the foreign country to qualify for retirement benefits.
-
As on date,
India has signed and operationalized similar comprehensive Social Security
Agreements (SSAs) with 15 countries. They are Belgium, Canada, Czech Republic,
Denmark, Finland, France, Hungary, Luxembourg, Netherlands, Norway, Sweden,
Switzerland, South Korea, Austria, and Australia. We have also signed a
comprehensive SSA with Portugal, which is in the process of getting operationalized.
In addition, we have a partial SSA with Germany, which is already operationalized.
-
The comprehensive
SSA between India and Japan when operational from 1st October 2016 will
favourably impact the profitability and competitive position of Indian
and Japanese companies with foreign operations in either countries by reducing
their cost of doing business abroad. Thousands of Indian and Japanese workers
who are working in Japan and India respectively will benefit from the agreement.
The SSA will also help more Japanese companies to consider India as a destination
for their manufacturing investments
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