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Q. The permanent residency scheme: In the backdrop of recently approved permanent residency schemes, discuss the scheme in detail.
Sep 03, 2016 Related to : GS Paper-2

Ans :

Introduction-

Recently Indian Government approved the scheme to grant Permanent Residency Status (PRS) to foreign investors (except Pakistan) who invest a stipulated minimum amount in the country.

What is permanent residency?

Permanent residency refers to a person's visa status, i.e. the person is allowed to reside indefinitely within a country of which he or she is not a citizen. A person with such status is known as a permanent resident. Many advanced economies such as the US, UK, Canada, Germany, Australia as well as Singapore and Hong Kong have permanent residency schemes.

The permanent residency scheme in India-

  • The permanent residency scheme (PRS) will be granted for a period of 10 years with multiple entries.
  • To avail PRS, the foreign investor will have to invest a minimum of Rs.10 crore to be brought within 18 months or Rs.25 crore to be brought within 36 months.
  • The foreign investment should result in generating employment to at least 20 resident Indians every financial year.

Advantageous of PRS-

  • It will enable an investor to live in India without requiring to register with the police annually or leaving the country periodically or returning to the home country for renewal of the business visa.
  • It will also enable an investor to fly in and out of the country multiple times, acquire residential property in India, allow the spouse to take up employment in the private sector and dependents to study at Indian educational institutions.
  • Essentially, the investor will get to live like an Indian citizen but without the right of franchise and it will encourage investments in India.

Issues in current scheme-

  • The demand of 20 employment creation is an unreasonable demand and it may not really help the Centre’s Make in India mission.
  • It’s investors in startups and professionals who seek to offer niche services. Most of them will run small operations and therefore will not need too many employees.

Conclusion-

Recently approved permanent residency scheme will definitely promote investments in India, but the issues associated with PRS needs to be addressed. Government should come up with detailed guidelines PRS to clear various ambiguities associated with it.


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