SL-India to enter into bilateral social security agreement

• It would allow Lankan migrant workers in India to contribute directly to EPF
• Aimed at removing current practical issues in withdrawing retirement funds

The government has decided to enter into a bilateral social security agreement with the Indian government, allowing Sri Lankan migrant workers employed in India to directly contribute to the Employees’ Provident Fund (EPF), which will exempt the requirement to contribute to the Indian social security system, the Ministry of Labour announced yesterday. 

According to prevailing labour laws in India, a Sri Lankan migrant worker employed in India is required to contribute to the Indian social security system and is not entitled to withdraw their contribution until they complete the age of 58 years.

Labour Minister Nimal Siripala de Silva noted that this arrangement poses practical difficulties in obtaining the funds from Indian authorities for Sri Lankan migrant workers once they return to the country.

Once the two governments ink the agreement, Sri Lankan migrant workers employed in India and vice versa, would be able to directly contribute to social security schemes in their respective countries, removing current practical issues in withdrawing their retirement funds.

In particular, the Ministry highlighted that this move would benefit Sri Lankan migrant workers and all foreign workers employed in Sri Lanka including Indians, who are covered by the EPF and are entitled to claim the total contribution made to the EPF with interest for the period of employment in Sri Lanka on account of cessation of the employment and return to their countries.

According to the official estimates, around 10,000 Sri Lankan migrant workers are currently employed in India are contributing to the country’s social security system.

Minister de Silva noted that a Bill, which is currently at drafting stage, would be shortly presented to Parliament to amend the Employees’ Provident Fund Act, No.15 of 1958 enabling Sri Lanka and India to enter into a social security agreement.