India Revamps Services Sector HR Standards to Boost Global Mobility and Trade Deals

Economy

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Updated on 16 Nov 2025, 01:29 pm

The Indian government is initiating a comprehensive upgrade of Human Resource (HR) standards within the services sector. The primary goal is to align domestic HR practices with international benchmarks, thereby boosting the global competitiveness of Indian professionals and facilitating smoother cross-border movement. This strategic move is closely linked to India's ongoing Free Trade Agreement (FTA) negotiations, where worker mobility has become a critical and sensitive topic.

**Context and Strategy** India is currently negotiating FTAs with several key partners, including the European Union, New Zealand, Peru, Chile, Oman, Qatar, Bahrain, and ASEAN countries. The government believes that modernizing and structuring its HR systems will provide its negotiators with a stronger footing. By demonstrating preparedness and adherence to global service quality standards, India aims to secure more favorable commitments on worker mobility in these trade deals. Experts note that improving HR standards is not merely an internal reform but a crucial trade strategy, as developed economies often require robust governance and skill verification frameworks before opening their labor markets.

**Planned Initiatives** The Ministry of Consumer Affairs is set to commission a detailed study to analyze how Indian service companies currently hire, train, monitor, and manage their employees. This study will benchmark these practices against global norms and cover a wide range of industries, including information technology (IT), healthcare, finance, tourism, logistics, education, legal services, and environmental services. It will also explore evolving work patterns such as remote delivery, 24x7 operations, and data-sensitive functions. The study is expected to be completed within 4–5 months of its commencement.

**Industry Perspectives** The Indian Staffing Federation (ISF) views this initiative as timely, emphasizing that workforce standards significantly influence market access and mobility commitments in trade talks. They believe the move will help identify and adapt global best practices to the Indian context, especially with the rise of remote work and customer-facing roles. However, industry leaders like Sonal Arora of GI Group Holding caution against a rigid, one-size-fits-all approach. She highlights India's unique ecosystem, characterized by informality, unequal access to education, and a large portion of the workforce lacking formal vocational training. Arora suggests developing an 'India-first BIS (Bureau of Indian Standards) model' that bridges skill gaps and supports formalization, rather than simply copying global frameworks.

**Impact** This government initiative is poised to strengthen India's negotiating position in international trade agreements, potentially leading to increased global opportunities for Indian professionals in the services sector. Companies may need to adapt their HR policies to meet the evolving standards, potentially enhancing overall workforce quality and productivity. The focus on skills and capability-led recruitment, as indicated by reports like TeamLease's Employment Outlook, aligns with this broader trend towards a more professionalized and globally integrated workforce. **Rating: 7/10**

**Difficult Terms Explained:** * **Human Resource (HR) Standards**: These refer to the established norms, practices, and benchmarks related to managing employees within an organization, including recruitment, training, compensation, performance management, and employee welfare. * **Global Norms**: These are widely accepted practices, standards, or expectations that are common across different countries or international organizations. * **International Competitiveness**: The ability of a country's professionals or businesses to compete effectively in global markets based on factors like skill, efficiency, quality, and cost. * **Free Trade Agreement (FTA)**: A pact between two or more nations to reduce or eliminate barriers to imports and exports, making trade easier and more predictable. * **Worker Mobility**: The ability of individuals to move and work in different countries, often a key component negotiated within FTAs. * **Skill Recognition**: The process by which qualifications, certifications, and skills acquired in one country are acknowledged and accepted in another. * **Service Quality**: The degree to which a service meets or exceeds customer expectations, a critical factor in international trade for services. * **Informality (in employment)**: Refers to economic activities and employment relationships that are not registered, regulated, or protected by the state, often lacking benefits and legal safeguards. * **Skill Gaps**: The difference between the skills that employers need and the skills that the workforce possesses. * **BIS (Bureau of Indian Standards)**: India's national standards body responsible for the harmonious development of the activities of standardization, marking, and quality certification of goods. The reference here implies adapting their role for HR standards.