In what could be a major relief to Indian companies, British Prime Minister David Cameron has said that the proposed immigration cap for non-European workers should not include 'intra-company transfers'.
The issue of restricting 'intra-company transfers' had agitated a number of Indian firms having operations in the UK, and the move to exclude the bracket from the immigration cap will help tens of thousands of migrant workers who move to the UK through this route every year.
Prime Minister David Cameron told the House of Commons that "the cap on non-European Union skilled workers shall not affect intra-company transfers for global employers".
The Prime Minister said he wanted to "achieve much better immigration control without disadvantaging business".
"For instance, things like intra-company transfer shouldn't be included in what we're looking at".
Under the present rules, workers arriving on intra-company transfers, many of them employed by Indian IT companies, can stay in the UK for up to five years.
The majority of skilled workers entering the UK from outside the European Economic Area come in on intra-company transfers.
In 2009, they accounted for 22,000 out of a total of 36,490 skilled migrants, and the government believes that the multinationals use this route to bring in cheap labour for jobs that can otherwise go to unemployed British youth.
The Confederation of British Industry and Indian business and ministers had urged the government to exempt intra-company transfers from the cap, insisting that they "enhance the UK's attractiveness as a global location for investment and jobs".
Sir Andrew Green, the chairman of Migrationwatch UK, said: "We agree that there is no need to cap intra-company transfers provided that they are genuinely key senior staff, which was the original purpose of the scheme".
"That does not include tens of thousands of Indian IT workers on 24,000 pounds a year when British IT workers face 16 per cent unemployment. Nobody really needed by an employer would be paid less than 50,000 pounds a year. That should be the minimum salary for these transfers".
Damian Green, the Immigration Minister said: "The government is committed to ensuring that the migration system works for business ensuring that managers and specialists can come to the UK and an exempted intra-company transfer route is one of the ways we will do that".