What is the Social Security Totalisation Agreement between the U.S. and India?
The Social Security Totalisation Agreement is a proposed arrangement between the United States and India. It aims to address issues related to social security contributions made by expatriates in the host country. Under this agreement, an expatriate would not be required to contribute to the social security scheme of the host country.
Who is Katherine Tai, and what has she said about this agreement?
Katherine Tai is the United States Trade Representative (USTR). She recently acknowledged receiving essential information from India regarding the proposed agreement. Tai emphasized that while the U.S. has the necessary data to proceed, there's still considerable work to be done to advance the negotiations.
Why is this agreement significant for Indian IT professionals in the U.S.?
This agreement is particularly significant for Indian IT professionals temporarily working in the U.S. Currently, these professionals contribute to the U.S. social security system but are often unable to receive any benefits from these contributions. The agreement would alleviate this issue.
How will the agreement benefit Indian expatriates in the U.S.?
The agreement will benefit Indian expatriates, especially from the IT sector, by exempting them from contributing to the U.S. social security system. This can lead to significant financial savings and reduce the double burden of social security contributions in both the home and host countries.
What was the context of Katherine Tai's statement?
Katherine Tai's statement was made during the 14th meeting of the Trade Policy Forum (TPF) between the U.S. and India. She and India's Minister of Commerce and Industry, Piyush Goyal, co-chaired this meeting.
What is the status of the agreement?
The status of the agreement is currently in the initial stages of negotiation. India has submitted the relevant data on its social security schemes to the U.S., and the U.S. is now reviewing this information to facilitate further discussions.
What is the impact of this agreement on services trade between the two countries?
The agreement is expected to significantly enhance services trade between the U.S. and India. By resolving the social security contribution issue, it could encourage more Indian professionals to work in the U.S., benefiting both economies.
Who Benefits from the Agreement?
The primary beneficiaries of the proposed U.S.-India Social Security Totalisation Agreement are temporary and short-term workers, particularly those from India working in the United States.
Why are Temporary and Short-Term Workers Beneficiaries?
Exemption from Dual Social Security Contributions:
Temporary and short-term Indian workers in the U.S. currently contribute to the U.S. social security system. However, due to the temporary nature of their stay, they often do not meet the eligibility criteria to receive benefits. The agreement will exempt them from these contributions, providing significant financial relief.
Enhanced Economic Efficiency:
Removing the obligation to contribute to two different social security systems (both in the home and host country) increases economic efficiency for these workers. It ensures their earnings are not unduly diminished.
Increased Mobility for Professionals:
The agreement is likely to encourage more Indian professionals to accept short-term and temporary assignments in the U.S., knowing they won't be losing out on social security contributions back home.
Benefits for IT Sector:
A large proportion of these beneficiaries are expected to be from the Information Technology (IT) sector, where short-term and temporary assignments in the U.S. are common.
How does this Impact India-U.S. Relations?
The agreement is a significant step towards strengthening economic and trade relations between India and the U.S. It addresses a long-standing issue impacting the mobility of skilled professionals, thereby fostering a more conducive environment for bilateral cooperation in various sectors.