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Dual Citizenship: New Policy
Dual citizenship? NRIs should pay tax too

Can India emulate US' dual citizenship model
<!--QuoteBegin-->QUOTE<!--QuoteEBegin--><b>Brake on dual citizenship </b>

New Delhi, March 1: The government has put grant of overseas citizenship on hold.

The home ministry that drafted amendments permitting overseas citizenship — or dual citizenship, as it is euphemistically referred to — in the citizenship act says it will need to amend the law again to meet Prime Minister Manmohan Singh’s expectations. Till the process is complete, the ministry has no intention of working on applications received during the three months the scheme was on.

<b>“Pending a review, we have issued instructions to foreign missions to stop accepting applications for overseas citizenship last month,”</b> an official said. He explained that when the fresh review was over, overseas citizenship would be more user-friendly.

Officials suggest that the revised law might not be anywhere near getting past Parliament before the monsoon session. “The review of the law and the rules is under active consideration of the government,” the official said.

Dual citizenship was allowed in December 2003 after an amendment to the act.

In principle, the home ministry is inclined to a single application form rather than the three forms that persons of Indian origin would have to choose from, depending on their age and the clause of the law under which they are applying.

But there are no clear answers to why it took the Prime Minister’s intervention to drive home that realisation or the fact that the criteria for overseas citizenship was too restrictive to make a difference to anyone in the first place. <b>For instance, under the existing law, only people who relinquished their Indian citizenship after the 2003 amendment were eligible to seek overseas citizenship.</b>

Prime Minister Singh had declared at the Pravasi Bharatiya Divas this January that dual citizenship would be extended to all Indians who migrated after January 26, 1950.

In doing so, he had not only covered Indians who left before the 2003 amendment but also expanded the list of countries where people who surrendered their Indian passports lived.

Now, Indians living only in 16 countries, including the US and the Britain, are covered.

<b>Some officials suggest that part of the problem in the restrictive regime was the confusion within the government on the status of the overseas citizens.</b>

After the 2003 amendment, the government appears to have taken the view that overseas citizenship did not amount to a second citizenship.<!--QuoteEnd--><!--QuoteEEnd-->
<!--QuoteBegin-->QUOTE<!--QuoteEBegin--> For instance, under the existing law, only people who relinquished their Indian citizenship after the 2003 amendment were eligible to seek overseas citizenship.<!--QuoteEnd--><!--QuoteEEnd-->

Mudy, the govt / ddm are <b>lying. </b>

See the text of what the 2003 law said, in my article "Dual Citizenship..." in the IndiaForum columns.

Clearly these Commie-Pakis are trying to undermine the 2003 law.
<!--QuoteBegin-->QUOTE<!--QuoteEBegin--><b>One big policy confusion</b>
June 16, 2005
<b>Recent reports suggest that the Ministry of Civil Aviation has been advised by the Department of Economic Affairs, Ministry of Finance, that a Person of Indian Origin (PIO) should be treated like any other foreigner and his investment in a domestic airline be capped at 49 per cent.</b>

<b>This is in contrast to the facility extended to the NRI, who is allowed to invest 100 per cent in a domestic airline.</b> However, according to various circulars and notifications issued by the RBI,<b> a PIO is to be treated on par with an NRI.</b>

Replying to a question in the Rajya Sabha on July 15, 2004, Minister of State for <b>NRI Affairs Jagdish Tytler said that PIOs get “parity with NRIs in respect of facilities available to latter in economic, financial and educational fields”.</b> He said that the benefits India will get by providing dual citizenship include strengthening of emotional and cultural ties with India, foreign investment in various sectors and transfer of technology.

Earlier on December 4, 2002, the then Minister of State in the MEA, Digvijay Singh, told the Lok Sabha that all PIO card holders shall enjoy parity with NRIs in respect of all facilities available to the latter in economic, financial and educational fields except in matters relating to acquisition of agricultural or plantation properties. No parity shall be allowed in the sphere of political rights.

The intention is to cause confusion after the cabinet decision of October 20, 2004, to hike FDI limit in domestic airline ventures from 40 per cent to 49 per cent. In doing so, NRIs were allowed to invest 100 per cent. As for FDI from others (read: foreigners barring foreign airlines), they will be allowed automatic approval by the RBI up to 49 per cent. The cabinet’s intention was clear. It meant that since PIOs enjoyed parity with NRIs, they would also be allowed 100 per cent investment in a domestic airline.

But this was not to be. <b>A bright bulb in the NRI cell of the Finance Ministry stated that the air transport sector (domestic airlines) is an extremely important sector which requires management and technical skills and financial strength of a “very high degree of successful operations”. </b>Apparently, for strategic reasons, this was never defined. And the nodal Ministry of Civil Aviation bracketed PIOs with other foreigners and said they could not invest more than 49 per cent.

The Department of Industrial Policy and Promotion (DIPP) of the Ministry of Industry and Commerce held an opposite view. It informed the Department of Economic Affairs that the FDI policy was incorporated under FEMA (transfer of issue of security by a person resident outside India) Regulations 2000. These regulations refer to an NRI as defined in the Foreign Exchange Management Regulations 2000 under which ‘NRI’ is defined as a person resident outside India who’s a citizen of India or a PIO. Thus, the provisions of FDI policy as notified in FEMA regulations would also apply to the PIO.

On June 7, 2005, the DIPP informed that NRI investment up to 100 per cent is permitted on the automatic route subject to no equity participation by foreign airlines. The DIPP then recounted the same regulations and concluded “in the light of the foregoing, investment by NRI (including PIO) would be permitted in the air transport services sector as per the notified policy”. In view of the unnecessary confusion, I asked the RBI whether a PIO is entitled to invest 100 per cent in a domestic airline like an NRI.

The Exchange Control Department (ECD) stated that according to FEMA Regulations, an NRI is a person resident outside India who is a citizen of India or a PIO. For the purpose of i) investment in shares/securities of Indian companies and ii) holding deposits with banks/Indian companies, ‘PIO’ means a citizen of any country other than Bangladesh or Pakistan if a) he at any time held an Indian passport, or b) he or either of his parents or any of his grand-parents was a citizen of India by virtue of the Indian Constitution or the Citizenship Act 1955, or c) the person is a spouse of an Indian citizen or a person referred to in sub-clause a) or b).

The RBI has notified that under the Automatic Rule in the Air Transport Services (Domestic Airlines) sector, NRIs may invest up to 100 per cent and other non-residents up to 49 per cent of the paid-up capital of the Indian company. No direct or indirect equity by foreign airlines is permitted. The notification will come into force from the date of its publication in the official gazette. The RBI will issue a circular on the subject after the notification has been gazetted. While Overseas Corporate Bodies (OCBs)  have been derecognised as a class of investor entity with effect from September 16, 2003, an erstwhile OCB may invest in equity of Indian company as a non-resident incorporated entity with the prior approval of the RBI/government. In their case, the limits as applicable to any other non-resident would apply.

The RBI’s PR department told me in a mail: “A careful reading of the ECD’s reply clearly indicates that the PIOs are treated on par with NRIs. This applies for their investments in domestic airlines too. Further, the RBI notification for allowing NRIs (and PIOs now that they are at par) to make 100 per cent investment in domestic airlines is pending publication in the official gazette. Once this is done, we will also issue our circular notifying it.”

Policy confusion not only scares investors away, but also strengthens the cause of crony capitalist and anti-competitive forces.
UPA is not only cluesless but brainless.
<b>India gives nod to dual citizenship for its diaspora</b><!--QuoteBegin-->QUOTE<!--QuoteEBegin-->Keeping its promise made during the Pravasi Bharatiya Divas, the Union Cabinet on Thursday approved a legislative amendment to permit dual citizenship, paving the way for issue of smart cards to Overseas Citizens of India (OCIs).

"The Government has decided to amend the Citizenship Act, 1955 and (also the) allocation of Business Rules to let the ministry of overseas Indian affairs issue notifications under Section 7B(1) of the Act and provide smart cards," Information and Broadcasting Minister S Jaipal Reddy said.

The amendment would benefit all people of Indian origin and their children and grandchildren "who migrated from India to countries other than Pakistan and Bangladesh after January 26, 1950", Reddy said after a Cabinet meeting chaired by Prime Minister Manmohan Singh.

<b>All those who were eligible to become Indian citizens January 26, 1950 or belonged to territories that became part of India after August 15, 1947 would be eligible for "Overseas Citizenship of India as long as their home countries allow dual citizenship in some form or the other", the Minister said.</b>

Granting of dual citizenship was an important and loudly cheered announcement made by the then Prime Minister Atal Bihari Vajpayee during the First Pravasi Bharatiya Divas in 2003.

Parliament also recently passed a bill to grant dual citizenship to the People of Indian origin belonging to 16 specified countries and gave an operational start to diaspora's productive engagement with India.

Prime Minister Manmohan Singh said, <b>"The Government has decided to offer dual citizenship to all overseas Indians who migrated from the country after January 26, 1950, as long as their home countries allow dual citizenship under their law."</b>

The bill, which amends the Citizenship Act, 1955, simplifies the procedure to re-acquire Indian citizenship by adults who are children of Indian citizens and former Indian citizens.

It provides for grant of overseas citizenship of India to PIOs belonging to 16 specified countries and Indian citizens who choose to acquire citizenship of any of these countries at a later date. It also makes acquisition of Indian citizenship and naturalisation more stringent, with safeguards against illegal migrants becoming eligible for Indian citizenship.

Dual citizenship, the main concern of the diaspora in developed countries, had been a long-standing demand. It took an event like Pravasi Bharatiya Divas to bring it to fruition. The Draft bill was introduced in Rajya Sabha on May 9, 2003 to amend the Citizenship Act, 1955, as a follow up to the announcement made during the first Pravasi Bharatiya Divas.

For those who have taken foreign passports, the grant of dual citizenship will remove the obstacles in travel to and from India with no multiple visa requirements.

<b>Due to security reasons, the dual citizenship facility was extended to PIOs of 16 countries only - Australia, Canada, Finland, France, Greece, Ireland, Netherlands, New Zealand, Portugal, Republic of Cyprus, Sweden, Switzerland, United Kingdom, and United States of America. Now it will be available to all PIOs across the world. There has been a demand from overseas Indians to grant voting rights as well but this has been specifically denied under the provision of dual citizenship</b>.
Yesterday they were clueless now ...........
Pakistani and Bangladeshi can call themselves Indians <!--emo&:thumbdown--><img src='style_emoticons/<#EMO_DIR#>/thumbsdownsmileyanim.gif' border='0' style='vertical-align:middle' alt='thumbsdownsmileyanim.gif' /><!--endemo-->
Any updates on dual citizenship?

Need this info for personal reasons. Any info is greatly appreciated
Not very clear till now. From last 2 days seeing some news in media but yet to see update in Govt site.
<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->Any updates on dual citizenship?

Per India Abroad (June 10 '05 edition page A18), <b>the dual citizenship cards are to be issued from this August</b>. Seems the systems are getting into place, being handled at individual consulates. They claim of 95% of the applications being processed in consulates itself and other 5% for people with 'questionable background' being sent to Delhi for closer scrutiny (I applaud the MMS govt for keeping a 5% quota open for these creeps)

This is in hard copy, if you need this article, I can try scanning it in next week or two.
No, it's not Dual Citizenship
<b>Overseas Indian citizenship scheme attracts many in Israel</b><!--QuoteBegin-->QUOTE<!--QuoteEBegin-->Saturday, 19 November , 2005, 08:35
Tel Aviv: An award-winning surgeon of Indian origin and his family have become the first Israelis to apply for Overseas Citizenship of India, amid a flurry of enquiry calls at the Indian mission in Tel Aviv.

Dr Lael Anson Best, a specialist in Thoracic surgery at the Rambam Medical Campus in Haifa, and his wife and daughter were the first to apply for the dual citizenship scheme from among the 70,000-strong Indian community in Israel.

As news of the highly anticipated overseas citizenship scheme sunk in, the country’s mission has been fielding frantic enquiry calls from people of Indian origin regarding its formalities.

"It is a matter of pride to get connected to my roots. We eat Indian food at home and are Indians in thoughts, action and taste, and it is a matter of great joy for me," Best said after applying for citizenship.

"I am seen as an Indian here and it gives me a distinct identity. Any Indian patient is immediately directed to me because of that connection. I had also immediately grabbed the opportunity to get the PIO card the moment I came to know about it," he said.

Best, who is fluent in Hindi and Gujarati, completed his Master of Surgery degree from University of Gujarat before immigrating to Israel in his 20s. The surgeon went on to win the Outstanding Award of Excellence in his field from the Israeli president and prime minister.

Others are also enthusiastic about the new scheme. "We have always taken pride in our Indian origin, which was one of the rare places where Jews didn’t feel threatened in exile and there was complete lack of anti-Semitism," said bus driver David Nagani. <!--QuoteEnd--><!--QuoteEEnd-->
I have several responses to Mr. Rana there (post above Mudy's)

1. Taxation: Currently there is no tax holiday for "NRIs" who actually abide by the law of the place where they reside. Lets consider US: You are liable for tax on WOLRDWIDE income. So you have to pay tax at US rates on interest in NRI accounts in India. If you had to pay taxes to India, then there is a tax agreement that allows you to claim the taxes you paid as a tax credit.

So this is a wash. Actually I would prefer to pay tax to India on Indian-source income, and tax to the US on US-source income. That's what the new system would imply.

2. Higher interest rate on NRI deposits. Sorry, but Mr. Rana is dreaming. For the past 2 years or more, interest rate on USD in NRI accounts has been worse than one could get with low risk, such as paying off home mortgage, or even CDs in the US. Deposits in INR earn HIGHER interest for "RIs" than for NRIs. So I would like that distinction removed, and everyone get the same interest.

Why would one deposit then in India? Because one has faith in India. As long as the NDA was ruling, INR crept UP relative to USD so that deposits made a while back, paid off quite well. Of course, now the thief-raj has made the rupee slide down again, to benefit Sonia's Italian Lire accounts.

Would I deposit in SBI? Not likely, because Rana is accurate in citing the hassles and the stinking attitude towards customers. but SBI is not the only bank around, nationalized or otherwise, fortunately.

Re: Travel. Exactly WHY would one want to travel on several passports unless one is a Paki? His description of the Paki attitude is not reflective of reality. I would say that when a Paki visits, say, US from UK it would use its UK passport, and deny any connection to TSP as far as possible. When the Paki travels to TSP, it would be well-advised to use the TSPassport, so that all the "Islamic Terrorist Republic of Pakistan Jehadic Immigration" stamps stay on the TSPassport, and the UK passport stays clean for presentation at US immigration.

I have heard that Israeli-Americans carry 2 passports, because presenting an Israeli passport at the immigration counters at many Islamic Paradises is a good way to get into very serious trouble.

But these days, many *****-Americans are trying to use some other passport than the American, for similar reasons.

All in all, the refusal to extend the Indian passport for "OINCs" is really the big blow, IMO. It may take a new government to kick the Babu-behinds and get that implemented.

The original law said that those who obtained citizenship of one of the 16 listed countries after Nov. 2003, would NOT BE CONSIDERED TO HAVE LOST Indian citizenship. I don't think the Sonia Raj has changed that part of the law. Whether Babus act on that or not depends on the attitude of the GOI of the time.

Also, Rana completely ignores the parts of the OINC legislation that deal with settling in India. I think that's where the OINC is very different from PIO etc. As it should be.

The "its not a dual citizenship" declaration is mainly to please the Commies and other dork Resident Non-Indians.

Overall, I can't really argue with the philosophy of of Indian citizens, who have no other citizenship, having better rights/ privileges than those who DO have other citizenship, as long as it is because of laws made by OTHER countries (such as the tax issue, where I presume, Oracle Operators who go overseas for a short period can salt away some $$ in NRI deposits, and not have to pay any tax on the interest for several years. Small compensation for a life with a lot of tough challenges and uncertainties. Why shouldn't India try, for a change, the NOVEL idea of treating Indian citizens better than it treats foreigners?

In fact my whole visceral objection to what the Parliament passed is that it implies that Indian citizenship is SECONDARY to foreign citizenship. They could avoid all these issues by following my recommendations in the article "Dual Citizenship or Dupli City?" In that scenario, India would just not worry whether you have other citizenship or not, and only look at your Indian credentials. But the Babus have mixed up everything in taxes, property rights etc etc and made the usual mess.

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