Number of Indians heading to Gulf countries falls, remittances dip

The number of Indian workers emigrating to the Gulf for work has dropped in the past couple of years, possibly due to slowing economies of countries part of the Gulf Cooperation Council (GCC) which have been hit by weaker oil prices.

NEW DELHI: The number of Indian workers emigrating to the Gulf for work has dropped in the past couple of years, possibly due to slowing economies of countries part of the Gulf Cooperation Council (GCC) which have been hit by weaker oil prices. The decline has been significant between 2014 and 2016.

According to official figures, the number of Indian workers emigrating to the GCC countries was 775,845 in 2014 and fell to 507,296 in 2016.

Though disruptions due to the Islamic State were largely in Iraq-Syria, the instability affected perceptions about the region as a whole.

The reduced flow of Indian workers to the Gulf is seen to have impacted remittances from these countries. While the breakup is not available, overall remittances as recorded in India’s balance of payments statistics fell slightly from $69,819 million in 2014-15 to $65,592 million in 2015-16.

In terms of number of Indians emigrating, Saudi Arabia showed a sharp decline from 329,882 in 2014 to 165,356 in 2016, almost a 50% drop.

Part of this is attributable to a slowing Saudi economy due to low oil prices. But for the past few years, Saudi Arabia has been following what the Indian government calls a ‘Saudiisation’ policy, which is aimed at employing more Saudi nationals rather than foreigners.

“This is to encourage the private sector to employ greater number of Saudi nationals as well as to reducing reliance on expatriate workers. Further, against the backdrop of declining oil prices, the Saudi government has introduced a number of new taxes/VAT so as to augment the sources of government revenue,” the foreign ministry told Parliament this week.

One of these is the dependant tax, which started on July 1, reported by TOI earlier.

From this year, Saudi Arabia has begun levying a dependant tax on non-nationals residing in the kingdom.

The tax rate is SR 100 (Rs 1,700 approx) per month on each dependent. It will be increased to SR 200 in 2018, SR 300 in 2019 and SR 400 in 2020 per dependent member of the expatriate family,” Saudi government said. There are around 3 million Indians in Saudi Arabia. For now, official figures do not show any noticeable impact on Indians there. Indian officials had, however, raised the issue with a visiting Saudi delegation on July 11, the MEA told the House.

In Bahrain, a construction company employing nearly 1,500 Indians laid off around 700 workers but was unable to repatriate them after clearing their dues due to the financial crisis. All such stories have an adverse impact on worker mobility. Indians also continue to get duped by fake recruiting agents. Instances of mistreatment of Indian workers could have added to the slowdown.

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