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Wednesday, August 12, 2020

End of a dream

Kuwait’s indigenisation drive points to impending return of migrants from Gulf — there will be challenges on both sides

By: Editorial | Published: July 8, 2020 3:11:54 am
coronavirus, covid 19, coronavirus lockdown, india lockdown, indian express Expat workers flocked to Gulf countries to build and run those economies following the oil boom in the 1960s and ’70s.

Kuwait’s move to reduce the share of expatriates in its workforce has deepened the spectre of an exodus of Indians from the Gulf. A draft Bill in the National Assembly has proposed that the percentage of Indian citizens in Kuwait should not exceed 15 per cent of its population — nearly 8 lakh Indians may have to leave Kuwait.

The possibility of a migrant exodus from West Asia is not new. Many countries in the Gulf region have been trying to replace expats in their workforce with locals. Saudi Arabia launched nitaqat — a Saudisation scheme which introduced quotas in the workforce — in 2011. Recently, Oman had proposed a phased reduction of expats in its workforce. Expat workers flocked to Gulf countries to build and run those economies following the oil boom in the 1960s and ’70s. They were welcomed mainly because the local population lacked the necessary skills, or the will, to meet the needs of the new economy. The Subcontinent was a major beneficiary of this economic boom as it exported both skilled and unskilled workers. Kerala, for instance, built on its historic relations with the region to plug in to the Gulf economy. Remittances from the Gulf boosted the Kerala economy, even funding its welfare net, while also helping to check unemployment in the state. There are many pockets in India that have benefited similarly from the Gulf economy. Even before the pandemic, two main factors seemed to be driving a change in this symbiotic relationship that has lasted nearly five decades and benefited both regions. One, the national economies in the Gulf are slowing down, forcing companies to lay off people. Two, these countries now host a large indigenous population in the working-age segment that needs jobs. With no economic revival in sight, these nations may have to reduce dependency on expat workers and enforce quotas in the private sector to provide jobs to local youths.

While the nationalisation of the workforce is an ambitious project, it is doubtful if the emirates, with small populations and even smaller pools of skilled workers, can keep the largely consumption-driven economies afloat without expat workers. Saudi Arabia’s experience is instructive. However, states such as Kerala are gearing to address the influx of migrant workers from the Gulf. Last week, it announced Dream Kerala, a project to support the returning workers, to augment the existing welfare measures for NRIs. Over 1.5 lakh people have returned from the Gulf countries after the outbreak of COVID-19, of which close to 70,000 have lost jobs. The challenge is enormous and can only get bigger in the coming months.

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