India pushes for social security pacts in all FTAs

India might soon enter into a social security agreement (SSA) with the US as the two nations are intensely engaging to seal a bilateral trade agreement. Going forward, such agreements could become an integral part of all free trade agreements (FTAs), including those currently under negotiation, top sources in the Ministry of Labour and Employment confirmed on Wednesday.

Sources familiar with the deliberations said that the issue was already discussed in a recent meeting between Labour and Employment Minister Mansukh Mandaviya and Commerce and Industry Minister Piyush Goyal.

"It has also been taken up with the US, but it is not clear as of now if the US will accept India's demand," one of the sources said.


An SSA is a reciprocal arrangement between two or more countries under which an employee on a foreign assignment is not required to contribute to the host country's social security fund but still receives the full benefit of their employment period for pension calculation. Additionally, employers are saved from making double social security contributions on behalf of their workers. However, such Indian workers abroad are required to obtain a Certificate of Coverage (CoC) from the Employees' Provident Fund Organisation (EPFO), which helps them avoid paying social security contributions in the countries where they are posted. The EPFO has been authorised to issue the Certificate of Coverage to employees posted in nations that have signed an agreement with India.

India currently has social security agreements with over 20 countries, including Germany, France, Canada, Japan, Belgium, Switzerland, Denmark, and Australia.

The recently concluded India-UK free trade agreement also includes a double contribution convention that provides a three-year exemption from social security contributions for Indian professionals temporarily working in the UK.

"This will be of great help to Indians working temporarily in the UK, and the plan is to now include such a social security agreement in negotiations for all FTAs," the source added.

India is currently negotiating free trade agreements with many countries, including the European Union. Furthermore, the country has emerged as a major source of skilled manpower, especially in IT and IT-enabled services, and such an agreement could significantly benefit Indian professionals working abroad. The move has been triggered by a substantial increase in India's social security coverage over the last 10 years, with the country approaching developed nations' levels, thus gaining enough confidence to negotiate on SSAs even with major economies.