Kerala economy may suffer as remittances from the Gulf shrink

saudi92617 Indian embassy in the Saudi capital Riyadh | AFP

Is Kerala's money order economy in trouble? Nearly 10,000 Indians are stranded in the Gulf states and 3,000 of them are in labour camps with no food for the past ten days. With Kerala contributing the major share of the migrant workforce and their remittance fuelling the state's growth engine, Kerala may have to brace for an uncertain future.

For the last few decades, the Kerala economy has thrived on remittances made by the migrants. The Malayali exodus to the Gulf started in the 1970s, when the local unemployment rate reached an all-time high and the Gulf economy was booming. Fighting the extreme weather conditions, the Malayali workers laid the foundations of the Gulf economy and ensured a prosperous life for their families back home. The harsh conditions and oppressive labour laws never stopped them.

There have been films and novels portraying the migrant life. In Benyamin's award winning novel Goat Days, Najeeb, the protagonist, who is a migrant worker in Saudi Arabia, says his "fervent desire was to sit in a bit of shade for some time." According to 2014 figures, there are about 24 lakh Malayali workers in the Gulf, up from 13.6 lakh in 1998. They sent home Rs 1 lakh crore last year.

The Gulf migrants have faced several crises, ranging from the Kuwait war to the global recession of 2008, and now another bout of recession caused by the falling oil prices. As the new crisis unravels, Minister of State for External Affairs V.K. Singh is expected to reach Riyadh to take stock of the situation.

Nearly 10,000 Indians working for Saudi Oger company are stranded in labour camps in Jeddah, Mecca and Taif. In Riyadh alone, 3,175 employees have not received their salaries for the past eight months. Now the company has stopped providing them food as well. The Indian government has started supplying them free rations with the help of the Indian diaspora.

External Affairs Minister Sushma Swaraj said in the Rajya Sabha, “If any Indian worker abroad is unemployed, he will not sleep hungry. The government takes full responsibility to feed them. If they get another job, that is fine, but if they want to return home, then I assure you, we will bring them home.” The government is holding talks with the Saudi government for arranging exit visas for the stranded labourers.

With more and more companies closing their operations and the number of visas getting restricted, the Gulf dream of an average Malayali is likely to turn sour, just like Kerala's remittance-dependent economy.

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Topics : #Saudi Arabia | #Kerala

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