Outsourcing to India
India has the largest young population worldwide, with more than 3 million students graduating from universities every year, including around 500,000 engineering graduates. Thanks to its constantly-growing young talent pool and its high level of English fluency in comparison to other Asian countries, India is one of the most popular outsourcing destinations not only in Asia but in the entire world.
The outsourcing services we offer at FMC Group allow clients to significantly reduce their labor costs and delegate the administrative management of their employees, giving them an important competitive edge. Our services also give businesses the opportunity to benefit from the extremely large Indian talent pool without having to go through the hustle of setting up a local subsidiary in India.
- Advantages of Outsourcing to India
- FMC Group’s Outsourcing Approach
- Advantages of Outsourcing with FMC Group
- Labor Laws in India
- Working Hours
- Annual Paid Leave
- Other Types of Paid Leave
- Minimum Wage
- Social Contributions and Taxes
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Advantages of Outsourcing to India
- The Indian talent pool is very large. Every year, Indian universities produce over 3 million graduates, including more than 500,000 graduates with engineering degrees, notably in computer science, aeronautics, mechanics, and electronics. Moreover, the Indian population is very young, as over half of it is below 25 years old.
- The vast majority of young Indian professionals can speak English very fluently, especially in comparison with their counterparts in other South Asian countries. This greatly facilitates communication between companies and workers.
- Labor costs in India are very low in comparison to developed countries. The median monthly salary in the country is only INR 29,400 (EUR 367). In the IT sector, the monthly salaries of full-time engineers vary on average between INR 30,000 and INR 55,000 (EUR 374 – EUR 686).
- The Indian government is focusing heavily on the country’s digital transformation, notably cybersecurity, in order to continue attracting foreign businesses that wish to outsource some of their services. India ranked first in Asia and 17th worldwide in the 2021 Kearney Global Services Location Index, a report that ranks countries based on four key elements: financial attractiveness, people skills and availability, business environment, and digital resonance.
FMC Group’s Outsourcing Approach
- We select candidates based on your criteria and requirements;
- We write up reports on the best candidates;
- We conduct job interviews;
- We conduct other types of tests if requested.
- We provide you with recordings of the interviews and allow you to make the final recruitment decision;
- We invite your employees to work at our local offices.
- We handle all the administrative and legal procedures related to your employees (contracts, payments, vacation monitoring, etc.);
- We allow you to fully manage the functions of your employees;
- We give your employees all the tools they need for their job.
Advantages of Outsourcing with FMC Group
- We tailor our search for candidates according to your specific needs;
- We share job advertisements on various digital platforms;
- We search for potential candidates in our growing talent database;
- We allow you to recruit from the immense local talent pool without having to set up a local subsidiary;
- We give you great flexibility that allows you to reduce financial and time costs;
- We give you full control over your local team of employees while we handle their administrative management.
Labor Laws in India
- Employees in India can work up to 48 hours per week and nine hours per day.
- Overtime work has to be remunerated at a rate of 200% of the regular salary.
Annual Paid Leave
- Employees in India are entitled to at least 15 days of paid vacation per year.
- Employees have to inform their employer of their wish to go on vacation 15 days earlier.
- Indians celebrate several dozens of religious holidays, but most of them are only observed in specific regions in India. Only three public holidays are nationwide:
- January 26th: Republic Day;
- August 15th: Independence Day;
- October 2nd: Gandhi Jayanti.
Other Types of Paid Leave
- Maternity Leave: New mothers can take 26 weeks of paid maternity leave for the birth of their first two children and 12 weeks after two births. Pay is fully covered by social security during this period.
- Paternity Leave: Only public sector employees are entitled to 15 days of paid paternity leave after the birth of their child. There is no such leave in the Indian private sector.
- Sick Leave: Employees can take up to 15 days of paid sick leave per year. Employers have to pay their employees at a rate of 70% of the regular salary during this period.
- There is no nationwide statutory minimum wage in India. Each state has its own regulations regarding minimum wage and it usually varies depending on the type of employment, the industry, the skill level of the employee, and the geographical area.
- The payroll in India is managed on a monthly basis, with salaries typically paid on the 28th of each month.
- The vast majority of Indian states have a statutory 13th-month salary bonus, usually paid before March 31st of each year.
Social Contributions and Taxes
- Employers in India have to pay 16.75% of their employees’ gross salaries as a social contribution.
- Employees have to pay a contribution of 13.75% of their gross salary.
- The income tax in India varies according to the employee’s annual revenue. It ranges from 0% to 30%.
Further Useful Information
- Please see India Ministry of Labor and Employment for more information on labor laws in India.