India Tuesday signed a Social Security Agreement with South Korea, a step that would "enhance movement of professionals between the two countries and strengthen bilateral trade and investment".
"The Social Security Agreement between the Republic of Korea and India was signed by Overseas Indian Affairs Minister Vayalar Ravi and Minister for Trade of the Republic of Korea Kim Jong-hoon in Seoul Tuesday," said a government release.
The overseas Indian affairs ministry said a number of Indians are working in South Korea, most of whom are working professionals or self-employed.
"There is a huge potential for employment of Indian professionals and workers in the Republic of Korea owing to a large labour supply gap in the market. The Social Security Agreement with the Republic of Korea would enhance movement of professionals between the two countries and strengthen the tradeand investment between the two countries," said the release.
India is likely to become a major source of migrant professionals due to its vast reservoir of technically qualified manpower in sectors like information technology, engineering, health, and finance and management, it said.
"Most of the developed countries have an umbrella social security systemmandated by law. It is usually funded through mandatory contribution from all working people and their employers (in a prescribed ratio) in order to provide multiple benefits like old age pension, disability insurance, health insuranceand unemployment insurance.
"Social security agreements address issues such as non-export of social security benefit, loss of contribution due to less than prescribed minimum contribution period, deprivation of benefit in the case of self-employed people on relocation, and loss of competitive edge to the Indian companies while bidding due to high rate of social security tax," the ministry said.
Negotiations between India and Korea were held in New Delhi in December last year.
Some of the benefits to Indian nationals working in South Korea after the agreement:
-For short term contract up to five years, no social security contribution would need to be paid under theKorean law by the detached workers - provided they continue to make social security payment in India.
-The above benefits shall be available even when the Indian company sends its employees to the Republic of Korea from a third country.
-Indian workers shall be entitled to the export of the social security benefit if they relocate to India or a third country after the completion of their service in the Republic of Korea.
-The self-employed Indians in the Republic of Korea would also be entitled to export of social security benefit on their relocation to India, or a third country.
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