Where to Hire in South Asia: 5-Country Comparison

Most South Asia comparison tables you will find are vendor marketing, and the all-in EOR uplift percentages in them are estimates presented as facts. This one separates figures I could trace to statute or a regulator from figures that only appear in commercial guides, and labels the second group as unconfirmed. Then it ranks the factors in the order that actually decides the outcome — talent depth, retention dynamics, termination friction, compliance surface, and statutory cost last.

Employer contributions

End-of-service cost

• Nepal — gratuity at 8.33% of basic monthly and provident fund at 10% matched are both deposited into the SSF in the employee's name (Labour Act ss.52–53), so end-of-service is pre-funded rather than a lump-sum shock. Accumulated home and sick leave is cashed out at last basic pay (s.49).
• India — gratuity under the Payment of Gratuity Act 1972, now folded into the Code on Social Security: 15/26 of last drawn basic plus DA per completed year, vesting after five years, for establishments with ten or more employees. Whether the codes shorten vesting is still settling — verify against the current notification.
• Sri Lanka — gratuity under the Payment of Gratuity Act No. 12 of 1983 after five years' service. The exact multiplier should be taken from the Department of Labour rather than from a comparison table.
• Bangladesh — gratuity obligations sit in the Labour Act 2006 and interact with whether the employee is covered by a provident fund. Pull the current gazette text; the commonly quoted 30 days' wages per year is widely repeated but should be confirmed.
• Pakistan — end-of-service gratuity arises under the Industrial and Commercial Employment (Standing Orders) Ordinance 1968, again commonly quoted as around 30 days' wages per year of service and worth confirming against the ordinance.

Termination difficulty

Contractor and PE risk

All five jurisdictions apply substance-over-form reasoning to employment status, and all five have dependent-agent or fixed-place permanent-establishment concepts in their tax law. The pattern that gets foreign companies caught is identical everywhere: a full-time 'contractor' who works your hours, on your equipment, in your standups, exclusively for you, sometimes with authority to sign. That is an employee for labour purposes and can be a taxable presence for tax purposes.

• The exposure is retrospective — back contributions, interest, penalties and, in some jurisdictions, reclassified employment rights.
• It compounds silently: the longer the arrangement runs, the larger the arrears.
• It is also the easiest risk to eliminate. Either scope the work genuinely — deliverables, autonomy, other clients, fixed term — or employ the person, through your own entity or an Employer of Record.
• Do not let anyone with authority to conclude contracts on your behalf sit on a contractor agreement in a country where you have no entity.

How to actually choose

What to verify before you commit

• Current employer contribution rates and wage ceilings from the regulator itself — EPFO, EPF Sri Lanka, SSF Nepal, EOBI and the relevant provincial institution.
• India's position under the Code on Social Security and the 2026 EPF/EPS/EDLI schemes, from the notification rather than a summary.
• The end-of-service multiplier in the actual gratuity statute for each shortlisted country.
• Whether prior official approval is needed to terminate, and above what headcount threshold.
• The minimum wage that applies to your sector and province or state, not the national headline figure.
• Any EOR quote broken into statutory pass-through versus vendor margin, with a statute cited per line.