EDITORIAL 2: All about the UAE’s new golden visa scheme for Indians
Context
The United Arab Emirates government has introduced a pilot nomination-based golden visa programme for residents of India and Bangladesh seeking lifetime residency there.
What are golden visas?
- Individuals seeking to immigrate to a country are typically required to fulfil criteria such as a minimum educational qualification and/or an offer letter from a company to work there. This process can be tedious and may take years.
- A golden visa bypasses this requirement, and hedges on an individual’s ability to pay a significant sum of money to the host country, which may be in the form of investments in government bonds, real estate and more.
- A smaller number of countries offer the ‘golden passport’, another route to citizenship by investment.
And what is the UAE’s golden visa scheme?
- According to UAE, the golden visa is essentially a pathway to long-term residency in the country without the need for a sponsor in the country.
- Eligible candidates may apply for residency for a period of five to 10 years. The golden visa system allows residents, foreign expatriates and their families to move to the UAE to work, live and study, while enhancing the environment that supports business growth and success in the country.
- The UAE currently welcomes two larger categories of persons under the golden visa scheme: Public investors, investors in real estate and entrepreneurs and Outstanding special talents.
- Outstanding special talents recognises six categories of eminent persons as described below: Talented people – doctors and scientists,
- Creative people in the fields of culture, art, and inventors, Executive directors, Athletes and specialists, Doctorate holders in the fields of engineering and science, Outstanding students in high school and university
How is the nomination-based visa policy different?
- The nomination-based policy awards its holders with lifetime residency in the UAE, as opposed to the current policy of five to 10 years.
- For instance, golden visa-holders in the real estate investor category may only enjoy residency status for the duration of their project.
- The final decision on the nomination will be made by the government after it receives the application.
- Applicants under the nomination-based policy need not visit Dubai and may merely obtain pre-approval from their home country.
- The applications could be submitted through the visa concierge service company, OneVASCO centres in India and Bangladesh.
How is the UAE’s golden visa scheme significant?
- India’s selection as the first country under the new nomination-based policy indicates the close business, cultural, and geopolitical relations between India and the UAE, especially after the signing of the Comprehensive Economic Partnership Agreement (CEPA) between the two countries.
- The nomination-based Golden Visa scheme is applicable to all countries that are signatories or partners under the CEPA.
- The project is slated to expand from India and Bangladesh to China and other CEPA countries.
- In theory, such systems generate economic benefits for both the individuals and the host nations, with the potential for revenue generation and beneficial investments.
- For instance, Saint Kitts and Nevis in the Caribbean, one of the first countries to create a citizenship-by-investment program in 1984, did so to bolster its cash-strapped economy amid a drop in world prices for sugar, its main export.
- Similarly, Portugal did this in response to the 2008–09 global recession and the 2012 European debt crisis.
Rising concerns
- However, the rising number of such programs has raised concern about their potential for misuse, in particular as regards security, money laundering, tax evasion and corruption.
- The report flagged the threat of people investing in an EU nation towards illegitimate ends, such as evading law enforcement investigation and prosecution in their home country and protecting their assets from the related freezing and confiscation measures.
- The sustainability of such programmes has also been under scrutiny, with some countries such, like Ireland, Greece and Malta, curtailing them to accommodate the needs of their local residents, given the rise in housing prices in Europe.
Conclusion
The UAE’s golden visa boosts ties and investment but raises concerns over misuse and long-term sustainability.