Oil crisis forces Kerala expat labourers to return from Gulf; govt makes provision in state Budget

Rahin KP, a supervisor at a construction company in Saudi Arabia, is planning to end his stay in the oil-rich Arab country after 15 years of work. “There is not much hope in continuing here. Salaries are delayed and my company is not very hopeful about getting fresh projects. Oil price crisis has hit the entire country a lot,” Rahin told Firstpost.

Rahin was staying with his family and his two small children were going to a school in Riyadh. Due to financial woes, he had sent back his family to Kerala last year in May. “When the salaries started to get delayed, it became quite hard to manage my family budget. Moreover, my company started to cut many other benefits too. We were having family insurance coverage, they scrapped it citing financial issues. They also moved us to a smaller flat to save money on rent allowance. Financial woes were hurting us a lot. So I had to send back my family, and now, I am also going back in two months,” Rahin added.

Rahin’s case is not an isolated one. Following the global oil price dip, Saudi Arabia, United Arab Emirates, Kuwait, Bahrain, Oman and Qatar, the six Gulf Cooperation Council (GCC) countries, are facing a tough time.

In a move to cushion the state budget, which was hit hard by oil price dip, the Arab governments started adopting several austerity measures. In September 2016, the International Monetary Fund, had forecast budget deficit for all the six GCC countries at USD 153 billion.

Additionally, to appease their own unemployed citizens, the governments also strengthened the nationalisation process across sectors.

 Oil crisis forces Kerala expat labourers to return from Gulf; govt makes provision in state Budget

UAE has around 17.5 lakh Indian expats of whom 8.5 lakh are from Kerala, according to statistics provided by the Indian Consulate. AFP

Rafeek Ravuther, Director at Centre for Indian Migrants Studies, told Firstpost that oil price crisis and reinforced nationalisation process in the Gulf countries is resulting in the return of Indian migrant workers. “Especially, the number of Keralites returning are increasing. The days of Keralites working as blue-collar workers in Gulf have gone. Now, either they are in mid-level jobs or senior level jobs. These two levels are the most threatened ones because Gulf countries can easily replace them or remove them to save money,” Rafeek said. “Many companies are centralising their activities to save money. Centralisation means jobs are cut,” he added.

Bijukumar K, a Gulf returnee in Kerala, said that he and his 20 friends had to struggle a lot without salary in the UAE for seven months as the construction company broke financially. “We had to run from pillar to post to get our dues cleared. Finally, we had to adjust with whatever they gave and leave the country. The situation is not at all good in any of the Gulf countries,” Bijukumar, who is driving an auto rickshaw in Ernakulam in Kerala for survival, said. Bijukumar left UAE in September 2016.

‘Money Order Economy’ to be hit

According to a study from Thiruvananthapuram’s Centre for Development Studies, around 50 lakh families in Kerala depend on the money that the migrants send home. There are around 4 million Keralites abroad and around 80 percent of these are in the Gulf. The remittances from them accounts for 35 percent of the state GDP.

Last year, Kerala’s Finance Minister Thomas Issac had voiced his concern on how the state Budget would be hit as the number of Gulf migrants returning home are going up due to the oil price crisis.
“There is going to be a very serious regional recession,” the minister was quoted as saying in media.

Keeping in mind support mechanisms for the returnees, in his latest Budget presented last Saturday, the minister had announced an increased Rs 1500 in the Pravasi Welfare Pension from the current Rs 500.

“It is a welcome move. We were asking for the same for a long time,” Rafeek added. “However, we have a few concerns. We know that only 1,50,000 Keralites have joined the scheme. So, we urge the government to start popularising campaigns for the scheme and also to have an online system so that workers can join without much hassles. The system’s banking network also should have to be widened,” Rafeek said adding that the scheme is quite important now as the situation in Gulf is worsening due to oil price crisis and workers are returning home.

Vijaykumar K, state vice-president of Pravasi Sangham, an organisation which works for the welfare of Non-Resident Keralites, said that those who are working outside India should remit Rs 300 monthly to Pravasi Welfare Fund. “Those who remit the monthly amount will be eligible for a monthly pension of Rs 2,000 after the age of sixty when they return,” Vijayakumar said.

As of now, subscribers to this scheme who continue to work even after the age of 60, get Rs 1000 as monthly pension. “We hope that this will also be increased to Rs 3000 or Rs 4000,” Vijayakumar added.

Amanullah M, a Gulf returnee, said that such schemes will be quite helpful for the blue-collar workers. “It is they who return home without much savings. Such a kind of pension scheme will help them a bit,” Amanullah, who worked for 13 years in UAE and returned last year, said.

The state Budget has also set aside a Rs 6 crores for the Welfare Fund for those who were compelled to return from Gulf. Additionally, Rs 61 crores is being allocated for Non Resident Keralites Affairs, the government arm which looks after Non-Resident Keralites, and a Rs 13 crore corpus has been set aside to support wedding, accident and healthcare for those who have been compelled to return. The state Budget has also set aside Rs 18 crore to support rehabilitation and skill development of Gulf returnees.

Meanwhile, the latest figures from the Indian government’s eMigrate, the official recruitment channel, also reveal that, while in 2015, if 782,083 Indians migrated to 18 Emigration Clearance Required (ECR) countries, in 2016 the number came down to 520,960, which is a dip of around 34 percent. In 2016, there were 2.5 lakh fewer jobs in comparison with 2015 as regards the Gulf region.

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Updated Date: Mar 07, 2017 10:31:24 IST