An Agreement on Social Security between Finland and India

Finland and India signed an Agreement on Social Security between the countries on Tuesday 12 June in New Delhi. The Agreement affects the social security of people moving between Finland and India and applies in particular to pensions. The Agreement enables preventing double pension contributions, which is important for Finnish companies operating in India and the staff employed by them.

Finland and India have agreed that so called posted (or detached) employees are covered by the pension provision of the country of departure. A Finnish employee whom the employer sends to work in India will remain covered by the Finnish earnings-related pension scheme for five years. The pension contributions for that period are paid only to Finland. Correspondingly, an employee sent by an Indian employer will be covered by the Indian pension system for five years.

The Agreement also includes provisions on payment of pensions between the states. A pension earned in India is paid to persons resident in Finland. An earnings-related pension earned in Finland is paid even at present to persons who have moved or returned to India according to the Finnish Employees Pensions Act, but the Agreement facilitates application for the earning-related pensions.

The Agreement will enter into force once both states have completed the procedures to enforce it required by their legislation. In Finland the Agreement requires approval by Parliament.It is expected that the Agreement can enter into force during the first half of 2013. The Agreement is supplemented by an Administrative Arrangement including further provisions for instance on the necessary documents and processing of pension applications.

Carin Lindqvist-Virtanen, Deputy Director-General, tel. +358 9 160 73870,  +358 50 5599167
Marja-Terttu Mäkiranta, Ministerial Counsellor for Legal Affairs, tel. +358 50 500 2894