Employment in Mumbai

At a Glance:

• Mumbai is India’s financial and entertainment center, and offices of big global names can be found here.
• Be prepared for a more laid-back approach to work — especially with what counts as “on time” in an Indian office.
• Check if your country has a double taxation agreement with India to make sure you’re paying fair amounts of tax.
• India’s social security schemes aim to cover as much of the country as possible, though expats usually organize private health insurance through their work.

The urban economy of Mumbai generates about 6% of India’s GDP and 40% of the country’s foreign trade. Commonly referred to as the commercial and entertainment capital of India, it is the seat of some important financial institutions such as the Reserve Bank of India, and the Bombay as well as National Stock Exchange. Several multinational corporations are also based there. Mumbai is the richest city in India and has the largest number of billionaires. The GDP per capita of Mumbai is around three and a half times as high as the national average.

Employment Opportunities — Can You Handle the Competition?

Competition for jobs is fierce among employees working in Mumbai, resulting in longer working hours and a more westernized style of business than in other parts of the country. Government workers and public-sector employees make up a big share of Mumbai’s active population, but so do semi-skilled or even unskilled self-employed workers. Apart from taxi and auto rickshaw drivers, the notorious dabbawallas working in Mumbai — delivering lunch boxes to office workers with incredible efficiency — are some of Mumbai’s unskilled workforce.

Aside from commercial trade, logistics, healthcare, and IT, the media is a big employer in Mumbai — home of the “Bollywood” film industry, producing over 1,000 films per year. Plenty of advertising agencies and numerous television production companies are also located in the city, providing jobs to thousands of Mumbaikars and expats alike.

Business Cards at the Ready

The style of doing business in Mumbai has been slightly westernized. The increased presence of foreign companies means large numbers of expats working in Mumbai, bringing their own style and pace of business to India. However, there are major differences between business cultures, so expats should be aware of some general practices before they start working abroad.

With its structure still rooted in the traditional Hindi caste system, Indian society is more hierarchical than what many Westerners working in Mumbai may be used to. This influences how people interact with their co-workers, and how bosses and employees deal with each other.

In an office environment, for example, menial tasks such as moving tables and chairs are rarely done by the regular office staff. Indian companies employ “runners” for this kind of work.

Expatriates from countries with a very casual workplace culture should note that the correct way of addressing business associates is by their title and surname rather than first name. Before you begin to use somebody’s first name, always wait for them to offer first.

You should always carry plenty of business cards with you. Failing to hand out your business card at a meeting in Mumbai might be considered impolite.

Creating and Maintaining Professional Relationships

Business gifts may be exchanged, but not necessarily at the first meeting. They should not be expensive and are rarely unwrapped in the presence of the giver. Avoid causing embarrassment by ensuring your gifts don’t contain alcohol, meat, or leather products if you are unsure about your associates’ religious beliefs. Establishing good professional and personal relationships with your contacts is essential to successfully work in Mumbai.

Don’t cause affront by being too straightforward. The word “no” is rarely used, even in a private context — “I’ll see what I can do” or “I have to double-check this” are often used instead. You’ll get the most positive responses by being more friendly than firm.

Patience and good will are more likely to win you respect in Mumbai than openly confrontational behavior — most importantly, never show anger, even if you feel it. Indian businesspeople often don’t commit to anything at the first meeting. Bargaining negotiations are acceptable, so expect to meet a few times before any agreement is made.

Expat Info Mumbai: Social Security & More

What to Expect in the Workplace

When it comes to being on time, don’t be surprised if you are kept waiting or if business meetings are rescheduled on short notice. This isn’t necessarily a sign of disrespect or low priority, it’s just simply the way it is. Similarly, don’t be offended if your guests are not on time. In fact, when invited to a social event like a dinner party, make sure to turn up between 15 and 30 minutes late.

As in most places, business attire in Mumbai depends largely on the branch or industry you are working in. To be on the safe side, men should always wear a suit and tie. Considering that Mumbai temperatures can be extremely hot, it is acceptable to remove your jacket. Women wear formal dresses or pantsuits covering their legs, shoulders, and upper arms. Some expats may switch to Indian clothing after a while as it is better suited to the climate — shirts and trousers made of linen are your best option here.

Avoiding Double Taxation

Foreign nationals with a permanent resident status in Mumbai are subject to Indian taxation laws. They are expected to pay income tax on their earnings, calculated at a rate of 0%, 5%, or 20% for incomes below 250,000, 500,000, or 1,000,000 INR respectively. All incomes above 1,000,000 INR a year are taxed at a rate of 30%.

Expats who spend fewer than 183 days in one fiscal year in India and who receive their salary from non-Indian sources may be eligible for tax relief if they continue to pay tax in their home country.

Tax relief can be granted under a formal Double Taxation Avoidance Agreement (DTAA) between India and the country concerned. It can also be negotiated on an individual basis if no agreement exists. To find out whether your country has a DTAA with India, consult your national financial authorities or visit the Income Tax Department website of the Indian Ministry of Finance.

Social Security in India

With about 370 million people having no pension plan whatsoever, India’s social security system is still very rudimentary. The two government schemes for old-age pensions and other benefits, the Employees’ Provident Fund Organization (EPFO) and the Employees’ State Insurance Corporation (ESIC), only include employees in the small “organized” sector. These are mostly private sector employees, civil servants, and military personnel.

However, proper enforcement strategies are not in place, due to a lack of government infrastructure. The ESIC, responsible for medical, sickness, maternity, and disability benefits, faces similar problems despite recent extensions of the membership criteria to cover wider parts of the working population. Since the ESIC does not provide medical coverage to the whole population, India can’t be described as having a working national health service.

Social Security Agreements for a Lucky Few

Expats in Mumbai who are employed by an Indian company are likely to qualify for EPFO and ESIC coverage and need to make social security contributions. However, bilateral social security agreements with other governments can excuse expats from paying contributions in India. Check the Emigration Services website of the Ministry of Overseas Indian Affairs to find out if your country has an agreement and if it is in force.

If present, social security agreements are applicable only to expats whose work assignment in Mumbai does not exceed 60 months. They may choose to continue their social security contributions in their home country instead, and all payments made to one system or the other count towards calculating the employee’s benefits. Your employer/company is also likely to organize a private pension plan for you in Mumbai.

Trust in the Private or International Healthcare System?

Mumbai offers good access to hospitals and healthcare facilities for those who can afford it. Expats can either take out health insurance with an international provider before coming to India or access private healthcare through their company’s insurance provider. Public hospitals are often understaffed and underequipped, due to poor funding and India’s huge population.

There are roughly 70 municipal hospitals in Mumbai and over 90 private clinics with varying specializations in the greater metropolitan area of Mumbai. It is always a good idea to keep a list of hospitals and clinics including their contact details handy. Most private hospitals have a website, and you can search for doctors or clinics by area or specialization.

You might be expected to pay for medical treatment immediately, as an integrated claims system only works for some public-private insurance companies. To prepare for this possibility, set aside some easily accessible funds for medical emergencies. In case you or a family member come down with something serious that requires prolonged treatment, make sure that your international health insurance also covers the cost of repatriation.