The pact will help thousands of Indian and Japanese professionals avoid double social security contributions
India and Japan on Wednesday signed a social security agreement expected to come into force on 1 October and benefit thousands of Indian and Japanese professionals and skilled workers working in the two countries, an Indian foreign ministry statement said.
The pact will help avoid double social security contributions, the statement said. In other words, an Indian worker on a short-term contract in Japan will be exempt from making a social security contribution there. The same applies to Japanese workers in India. This exemption will be provided only if the Indian worker is covered under the social security system of India and continues to pay his or her contribution during the period of overseas contract.
The pact will also help easy remittance of benefits in case of relocation and aggregating the contribution periods (in two countries) to prevent loss of benefits, it said.
India has so far signed similar comprehensive social security agreements with 16 countries, including Belgium, Canada, Czech Republic, Denmark, Finland, France, Hungary, Germany, the Netherlands, Norway, Sweden, Switzerland, Republic of Korea, Austria, Grand Duchy of Luxembourg and Australia. A pact with Portugal is in the process of being operationalized.
The India-Japan pact will “favourably impact the profitability and competitive position of Indian and Japanese companies with foreign operations in either country by reducing their cost of doing business abroad.
“Thousands of Indian and Japanese workers who are working in Japan and India will benefit from the agreement. The SSA (social security agreement) will also help more Japanese companies consider India as a destination for their manufacturing investments,” the statement said.