Nine pacts in hand, India presses US to begin totalisation talks

•  India has stepped up pressure on the US to start negotiations on a totalisation agreement that would exempt Indians working for a short period in the country from making social security contributions there.
• A social security agreement with the US could save India more than a billion dollar in lost salary every year, according to estimates made by software industry body Nasscom .
• A foreigner working in the US for less than five years could be exempt from paying social security tax if his home country has a totalisation agreement with the US and the worker contributes to the social security scheme of its native country.
• The US has been dilly-dallying on an agreement with India on the ground that social security structures of the two countries were different. India has proposed that concerns about non-compatibility of the social security systems of the two countries could be addressed during the talks.
• India has totalisation agreements with Belgium, France, Germany, Switzerland, the Netherlands, Hungary, the Czech Republic, Denmark and Luxembourg.These agreements entitle people from both countries to be exempt from paying social security tax if they work for a short period in the foreign country and make contributions back home.
• Since contributions made for social security in the US yield benefits only after ten years of work, Indians working on H1B visas are not in a position to gain from it as the maximum stay allowed under these visas is six years. The ministry of overseas affairs and department of IT are also part of the discussion with the US.