Grim Future Awaits Indian Workers Being Expatriated From The Gulf

This could be the time to synergize the skills of the Gulf returnees to advance the “Make in India” initiative.

(Photo: Kamran Akhter/The Quint)

On Thursday, 7 May, India began exercising Mission Vande Bharat, which is being billed as the largest repatriation exercise in the world. The first two flights ferrying in Indian expatriates home landed not surprisingly in Kerala, arriving from the UAE.

A major chunk of the repatriation will take place from the Gulf region – India’s extended neighbourhood, where around 8 million Indians live and work.

Almost 2 lakh Indians have signed up for repatriation from the UAE alone. The evacuation is reminiscent of another one India had executed more than three decades ago – during the invasion of Kuwait by Iraq. About one lakh Indians were airlifted from Kuwait then, which was then the world’s largest evacuation.

There is, however, a difference in the two. When Indian expatriates in Kuwait were being evacuated home, they had hopes of getting back to their jobs and employment in Kuwait once the storm had blown over. This time around many will not be having that hope. There will be lay-offs, curtailments and retrenchments. Something that has already begun to happen.

Why India Is the Largest Expatriate Community in The Gulf

Indians constitute the largest expatriate community in all the six countries that comprise the Gulf Cooperation Council – the GCC – Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE.

In almost all the countries Indians are the largest expatriate population, constituting more than 30 percent of the total expatriate work force in the region. The annual remittances from the GCC to India amount to a whopping almost $45 billion.

This did not happen overnight. There were deep historical reasons – much of the clerical and bureaucratic work in the GCC region during the colonial rule was conducted by Indians. Keeping up with the tradition, as over the years with the discovery of oil and the oil boom, Indians came to be increasingly preferred to work in the GCC countries.

Though half of the Indian workers work in blue collar jobs, their docility, political neutrality, ability to work hard at lower wages raised their profiles.

More recently, healthcare workers from India have been recruited in large numbers in the region, constituted a large chunk of the Indian labour force in the GCC countries.

Policy to Localise Workforce in Gulf Led to Reverse Migration

It is true that a reverse trend in migration from India to the GCC had begun more than a decade ago for a variety of reasons, including economic downturns in 2008-2009 and 2014. Most of the countries had adopted the nitaqat law – which is a policy of localisation of the workforce in each country.

Thus Saudization in Saudi Arabia, for instance, which meant recruiting more local Saudi employees rather than foreign workers, and Emiratization in the UAE.

A combination of factors warranted these nitaqat laws: growing unemployment because of an increasing in the young population in countries like Saudi Arabia, diversification of the economy to wean it from oil-dependency and ensuing austerity, the induction of women into the work force and so on. Thus, the total number of migrants who were recruited for jobs in the GCC in 2019 – 334,000 - were less than half of those recruited in 2015.

Nevertheless, a survey in the UAE in 2019, said that employers would continue to recruit Asians.

Situation Worsens With Onset of COVID-19

However, with the COVID-19 pandemic and falling oil prices, the situation is direr.
Across the region events, initiatives, plans for diversification of the economies and revenue earnings are being postponed, curtailed, put on hold. As a result workers in many organisations are becoming redundant. The lockdowns and social distancing have resulted in lower oil consumption and demand, leading to crashing oil prices across the globe.

In its Monitor third edition: COVID-19 and the world of work the International Labour Organisation has warned that the jobs of 1.6 billion people across the world are being affected. In the Gulf region the organization has said that that exodus of expatriate workers would be larger this time around than any other earlier crises.

In the last week of April, Oman’s Ministry of Finance issued a circular calling for expatriate employees in the country’s government sectors to be replaced by Omanis so that they can contribute to the Sultanate, adding that it should be done in a ‘speedy and organised’ manner.

Cultural factors in Oman as across the GCC result in the government sector as the preferred sector for native workers with higher salaries, facilities, and status. The state sector is also one of the largest employers. According to the World Bank Oman’s economic growth slowed by 1.3 percentage points. Amidst the 8 lakh Indians work in Oman, many of them are in the government sector.

In a similar vein, this week Saudi Arabia’s Ministry of Human Resources and Social Development decided to allow the private sector to cut salaries by 40 per cent and to terminate employee contracts after six months of the coronavirus pandemic period.

Saudi Arabia’s Finance Minister Mohammed al-Jadaan said in an interview that "We must reduce budget expenditures sharply." Saudi Arabia's central bank foreign exchange reserves fell in March at their fastest rate in at least 20 years.

In Kuwait, several parliamentarians warned they would block any draft law allowing private firms to cut wages of nationals. The UAE enacted a new regulation on March 26 that allows employers to temporarily reduce salaries or force employees to take paid or unpaid annual leave.

Of 3.5 Lakh Who Signed up for Repatriation, Most in Distress

There have been media reports of worker redundancy – both of blue collar workers and of professionals in the region. Kerala alone has registered 3.5 lakh Indians who have signed up for repatriation from the GCC. Many of those who have signed up for repatriation to India, for instance, are those “in distress” - who have lost their jobs or whose contracts have been terminated.

Remittances to home countries from the GCC have also fallen by 65 percent in individual remittances in April, according to the UAE based Delma Exchange, an exchange shop in the UAE. According to World Bank estimates remittances are expected to drop by 20 percent in 2020.

What this means for India is not hard to conjecture. Over the years the Indian government has grappled with falling migration to, and return migration from, the Gulf region. It has taken a number of measures to help migrant workers both in the host country and for their rehabilitation on return. India has faced black swan events earlier though perhaps of not such magnitude. Maybe this challenge enfolds within it an opportunity too.

With the government’s plans to lure to Indian companies moving or wanting to move out of China, this could be the moment to synergize the skills and capabilities of the Gulf returnees to really advance the “Make in India” initiative.

(Aditi Bhaduri is a widely-published journalist and political analyst. She tweets @aditijan. This is an opinion piece. The views expressed above are the author’s own. The Quint neither endorses nor is responsible for them.)