KOCHI: For 26 years, the Gulf was home to Unnikrishnan Chadayamangalam. Working as a special traffic officer with Qatar Petroleum, he witnessed the region’s golden era of growth, when oil wealth fuelled a construction frenzy and thousands of Malayalis crossed the Arabian Sea in search of a better life. In 2021, 60-year-old Unnikrishnan returned home.
As conflict casts a shadow over West Asia, he wonders if his home state can keep the extraordinary migration story going. “We can’t say that Keralam’s migration boom to the Gulf is over, though the present situation does not allow for such a scenario,” he says.
Few forces have shaped Keralam’s economic and social landscape as profoundly as migration. If the Keralam model laid the foundation for social development, the Gulf boom supplied much of the money that transformed everyday life.
The scale is staggering. India received an estimated $135.4 billion to $136 billion in remittances in FY25, retaining its position as the world’s largest recipient. Keralites accounted for nearly a fifth of the inflows, a remarkable share for a state with less than 3% of India’s population.
But the story began in an era of economic despair.
“In the 1970s, the state’s agricultural economy was stagnating, industry was languishing, and the only sector showing some growth was services. The slowdown continued into the 1980s.Keralam survived because of remittances,” says K J Joseph, director,Gulati Institute of Finance and Taxation.
The oil boom in the Persian Gulf proved a turning point. Flush with petroleum revenue,countries in the region embarked on massive construction projects,creating an insatiable demand for labour.Keralam, already struggling with unemployment, was ideally positioned to supply it.
The first wave comprised largely unskilled and semi-skilled workers. They endured harsh conditions, lived frugally and sent their savings home. Remittances in turn unleashed a construction boom in Keralam.
Demand surged for masons, carpenters, electricians and other workers. As construction wages climbed, agricultural labourers demanded comparable pay. Household spending increased and living standards improved.
The money was changing the very structure of the state’s economy.
Long before the Gulf boom, Malayalees had travelled to Ceylon (Sri Lanka), Burma (Myanmar), Singapore, Malaysia and India’s major cities in search of employment, recalls development economist K P Kannan. But those migrations largely generated subsistence-level remittances, enough to meet basic household needs.
The Gulf changed the equation. “By the end of the 1980s, remittances had crossed a little more than 10% of the state income,” Kannan says. By the turn of the century, remittances had climbed to around 24%. Today, Kerala receives an estimated `2.2 lakh crore annually in remittances, equivalent to nearly 17% of the state’s income, according to Kannan, a former director of the Centre for Development Studies.
Yet, beneath these impressive numbers, the migration story is undergoing a quiet transformation. Kannan estimates that the number of Keralites living abroad has declined from around 25 lakh to 21 lakh.
More significantly, the migrant has also undergone change. Today, more than 30% of migrants have at least an undergraduate degree, compared with barely 10% in 1990.
For the unskilled worker, however, the Gulf’s attraction has diminished. A construction labourer can now earn `1,000-1,200 a day in Keralam.
The traditional advantages that propelled Keralam’s migration boom remain intact. But the world around them is changing.
K V Joseph, board member of the International Institute of Migration and Development, points to the growing “nativity movement”, where host populations increasingly resist immigration. “This mentality is gaining ground in the US and European countries,” he says. The Gulf presents a different challenge: geopolitical instability. “If the Gulf region faces more trouble, there is a likelihood that some people will have to return, and migration could decline,” Kannan warns.
As Keralam turns 70 on November 1, the question is no longer merely how much money its people can earn abroad. It is how much opportunity the state can create at home.