Emeritus Senior Minister Goh Chok Tong appeared to brag on social media that he has been credited with starting the “India fever” since he’s been promoting India-Singapore business relations since the 1990s.
Sharing last week that the Confederation of Indian Industry presented an award to him for his work pushing India-Singapore business, the former Prime Minister shared:
“Confederation of Indian Industry presented me an award for promoting India-Singapore business relations. I have been doing that since the early 1990’s. They credit me for starting ‘the India fever’.”
ESM Goh’s pride over starting the “India Fever” comes as undercurrents of frustration over the India-Singapore Comprehensive Economic Cooperation Agreement (CECA) continue to prevail among many Singaporeans.
The bilateral free-trade agreement has been controversial among locals since it opens the floodgates for Indian nationals to migrate here and compete for jobs with Singaporeans with greater ease. Many locals see this clause as unfair since Singaporeans are less likely to migrate to India in return.
The agreement also ensures tariff concessions for various imports and exports between the two nations. In 2017, total bilateral trade between Singapore and India amounted to S$25.2 billion and Singapore has reportedly become the second-largest investor in India with cumulative investments worth S$36.3 billion.
While CECA was signed by then-newly minted Prime Minister Lee Hsien Loong, ESM Goh’s admission that he has been working to promote India-Singapore business relations for the past three decades has led some to believe that ESM Goh may have been one of the key figures pushing a bilateral free-trade agreement with India during his premiership.
Cleverly hidden clauses
In the agreement, Chapter 9 provides for the movement of people between the 2 countries.
In particular, it provides very laxed rules for the so-called “intra-corporate transfer” of employees, encompassing some 127 different type of professionals described in Annex 9A: IT professionals, architects, civil engineers, electrical engineers, doctors, biochemists, pharmacists, lecturers, accountants, auditors, financial analysts, psychologists, career advisers, etc.
In Article 9.5, Clause 1, it talks about providing a “long-term temporary entry” to “intra-corporate transferees”. In fact the name itself should have raised a red flag to PM Lee. How can an entry be simultaneously “temporary” but yet “long-term”?
The clause stated that “each party shall grant temporary entry to an intra-corporate transferee of the other party, who otherwise meets its criteria for the grant of an immigration visa, for an initial period of up to two years or the period of the contract, whichever is less. The period of stay may be extended for period of up to three years at a time for a total term not exceeding eight years”.
Bottom line is an “intra-corporate transferee” can stay up to 8 years before he is “rotated” out of the country. And the person shall be exempted from any labour market testing or economic needs testing, as specified in Article 9.3:
“Neither Party shall require labour market testing, economic needs testing or other procedures of similar effects as a condition for temporary entry, in respect of natural persons upon whom the benefits of this Chapter are conferred.”
That is to say, economic needs testing like Singapore’s fair consideration framework which ensures fair hiring of Singaporeans cannot be applied to “intra-corporate transferees”.
To top it all off, CECA Article 9.6 even allows the “intra-corporate transferees” to bring in their spouses or dependents to work too:
“A Party shall, upon application, grant the accompanying spouses or dependents of the other Party the right to work as managers, executives or specialists, subject to its relevant licensing, administrative and registration requirements.”
In cases where their spouses or dependents are not professionals, they shall be allowed to work in other areas:
“Such spouses or dependents can apply independently in their own capacity (and not necessarily as accompanying spouses or dependents) and shall not be barred by the Party granting them the right to work from taking up employment in a category other than that of managers, executives, or specialists solely on the ground that they as the accompanying spouses or dependents are already employed in its territory as managers, executives or specialists.”
India IT companies exploiting the “intra-corporate transfer” loophole
This led Indian IT companies like Wipro or Infosys to exploit the “intra-corporate transfer” loophole and move a large number of Indian IT workers into Singapore since CECA does not set any quotas and since they do not have to hire a single Singaporean in their Singapore-based subsidiaries.
When unemployment rates for Singaporean PMETs climbed and when Singaporean workers began to complain of discriminatory hiring practices at such firms, the Government responded and began to slow down the approvals of Indian IT professionals to work here.
This did not sit well with the Indian Government.
Times of India reported that work visas for Indian IT professionals to work in Singapore have dropped “to a trickle”, prompting the Indian government to put on hold the review of CECA, citing violation of the trade pact.
In particular, the Indian Government was against Singapore using our “fair consideration framework” to regulate the employment of foreigners in Singapore.
“They are doing it despite the CECA clearly stating that there will be no ENT (economic needs test) or quotas on agreed services. This is a violation of the agreement,” warned an Indian official.
That was last year. This year, the India-Singapore relationship has since gone back on track to good terms with both Governments enhancing the CECA pact in June this year. The agreement was expanded to officially recognise Indian nursing degrees and includes an tariff concessions for more products.