UAE and the Indian migrant workers

An overwhelming majority of workers are migrants in the UAE, which is also the favourite destination for Indians too.

Published: 06th January 2012 01:05 PM  |   Last Updated: 16th May 2012 06:09 PM   |  A+A-

The UAE is a huge labour-receiving country. In the UAE, an overwhelming majority of workers are migrants, particularly from South and South-East Asia. UAE is the favourite destination for a maximum number of overseas Indian workers too. Not only did the oil-fuelled economic growth of recent years feed the construction boom there; it has also helped sustain the economies of countries of the developing world.  As nationals are not available for employment in low-skilled occupations such as construction sectors, any growth benefits migrant workers.

Regional economic growth has also been spurred by other fields such as real estate investment, housing, tourism and foreign assistance. The UAE is the third-largest sender of remittances in the world. But remittances are strongly dependent on economic condition. Though the impact of the global financial market crisis is relatively limited on the economy of UAE due to the oil-related economic growth, experts predict that the crisis is going to hit the region more forcefully in the future. Emphasis has been put on the fact that the population growth and slipping of oil price is creating difficulties for economic development in the Gulf Cooperation Council (GCC) countries in general where 70 per cent of the population are migrant workers.

Anecdotal evidence suggests that due to the financial crisis a number of labour migrants have returned from the Gulf. However conclusive evidence has not been found. Still one Indian state in particular has been deeply affected by this – Kerala. A report states that one-tenth of the Keralite migrant workers in the Gulf -- are due to return home because they no longer have jobs in the Gulf. The Kerala government is hoping to keep these returnees on their feet and off the dole by setting up a loan package of about $20 million to start small businesses. Despite the sharp drop in oil prices, financial reserves accumulated in recent years have allowed these countries to sustain their economic growth. Despite the absence of statistical information, this should mean that the volume of migrant workers has not decreased.

Though many expatriates left the UAE after the crisis my research indicates that more people came to the UAE than left as they were attracted by a massive increase in projects. As they say there is pill for every disease, this crisis can be disentangled. UAE is still strongly dependent on the production of natural resources and employment levels are relatively low among women – something that needs to be reversed. Effective employment policy reforms, public investment in infrastructure and housing can create important opportunities for employment.

Improving labour market monitoring mechanisms, providing better protection against the risk of unemployment can be implemented. In conclusion the GDP growth of several countries, especially in South Asia, is strongly dependent on the economy of the UAE. Therefore solutions need to be implemented soon.

Puspangshu Chowdhury

Class 12, MCC Higher Secondary School, Chennai

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