China has said it will overhaul its visa regime in a bid to attract foreign talent, especially in high-technology industries, to bridge what officials have described as an alarming “talent deficit” that is challenging the government’s plans to transform the growth model.

New official figures have starkly exposed the challenge faced by China in retaining its top talent even as outdated visa restrictions have posed barriers to attracting the brightest minds from elsewhere — a challenge similar to the one faced by India and other developing countries.

In 2012, as many as 148,000 Chinese obtained overseas citizenship, while China granted only 1,200 permanent residency “green cards” to expatriates, according to the State Administration of Foreign Experts Affairs (SAFEA), a body set up with the sole aim of attracting overseas talent.

As many as 613,000 overseas professionals came to work in China in the same year, but most were on temporary work visas, according to the agency.

The SAFEA’s head, Zhang Jianguo, said the agency now plans to make it easier for foreign professionals to receive long-term residency permits in a bid to attract talent needed for the government’s plan of transforming growth away from the State-investment, export-led model to high-tech, innovation-led and sustainable development.

Zhang said professionals with expertise in new energy and green sectors would especially be given preference, as China battles a pollution problem that is, at the same time, driving away both Chinese and expatriate talent. Underlining the challenge companies are facing to hold on to talent as pollution levels worsen in cities such as Beijing and Shanghai, last month Japanese electronics firm Panasonic said it would begin paying employees here a “pollution premium” to encourage them to stay.

Green Card

Zhang said China would begin by expanding its hard-to-get version of the “green card” — a permanent residency certificate that began to be issued in 2004 and has, till date, been given to only 6,000 foreigners.

Preference has, so far, been given only to those who invest at least $500,000 and those with “skills needed by the State”, he told the official China Daily . The government has also introduced a new “R visa” for foreigners with “skills urgently needed in China”, such as in high-tech industries, to enable long-term stay and multiple entries, he said. Currently, most foreigners are given either one year or five year visas.

The SAFEA move follows a major initiative launched last year to retain top Chinese talent to stem China’s “brain drain”, especially in research.

The government said it will offer hundreds of millions of Yuan worth of “seed funding” for Chinese entrepreneurs who return. This followed the publishing of an official survey that found that eight out of 10 top experts in science and engineering who went overseas to study had no plans to return to China.

The government has launched a “coordination group on specialists” to spearhead the initiative and encourage Chinese scientists and researchers living in the West to return.

The group has been given a target of bringing back 2,000 Chinese specialists in Information Technology, aerospace and biotechnology, and has been given a 600 million Yuan (around $ 100 million) fund that will be earmarked for returnees pursuing research in the sciences.

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