Investment and skilled mobility linkages between India and the EU

Abstract

The migration of skilled labour is a matter of primary significance in the context of India–European Union (EU) relations. Over the past two decades, skilled migration from India to the EU and vice versa has mainly been associated with knowledge transfer to support the operations of EU-based multinational corporations (MNCs) present in India. In recent years, Indian investment in the EU has also gained importance, with leading Indian IT companies establishing a local presence in several EU countries. This investment has been supported by temporary skilled migration from India to the EU. This chapter examines skilled labour mobility between India and the EU in the context of bilateral investment flows. The discussion indicates that there is considerable short-term mobility from India to EU countries of Indian business visitors, intra-corporate transferees and professionals working for the Indian subsidiaries of European firms. There is also movement of skilled Indians, who work for Indian firms in India, to EU-based subsidiaries. In both cases, movement from India to the EU is mainly driven by the need to address skill shortages in the EU countries and to facilitate the offshoring of client processes to India. The significance of the Schengen Treaty and the EU Blue Card scheme is highlighted in this context. We conclude with a summary of the main factors that affect skilled labour mobility between India and the EU, and we outline the policies that could be undertaken to facilitate these flows and realise greater benefits. This chapter is based on Mukherjee and Chanda (2012) which was prepared as part of a research project titled ‘Developing a knowledge base for policymaking on India–EU migration’, financed by the European Union (EU) and carried out by the Indian Institute of Management Bangalore, the European University Institute (EUI), India Centre for Migration and Maastricht University (Faculty of Law). The project aimed at promoting a constructive dialogue between the EU and India on all migration-related issues. The authors are grateful to all those who participated in the discussions and shared their views and insights.