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.