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NEW DELHI: The gold rush for Indian workers threatens to come to an end with Saudi Arabia bringing in a new labour law that requires companies to hire one Saudi national for every 10 expatriate workers. The Nitaqat programme that came into force recently will hit an estimated 1.5 million Indians working in the West Asian nation the hardest. Faced by the prospect of lakhs of unemployed workers returning to India, the Centre has decided to send a ministerial delegation headed by overseas Indian affairs minister Vayalar Ravi to hold talks with the Saudi government.
The bulk of the workers come from Kerala and Andhra Pradesh and the state governments are under immense pressure. Indians in Saudi Arabia have been remitting around $3.5 billion annually. This is the largest amount of inward flow of foreign exchange from any single country. Around 1.5 million Indians are working in Saudi Arabia, of whom around 85% are in the blue-collar category.
Sources in the MOIA said that efforts will be made by India to get Saudi Arabia to stagger the implementation of the programme. "We hope to convince the Saudi authorities to give some time for the workers who are being laid off under the new law to find employment in a neighbouring country or at least make arrangements for their return,'' a source said.
After the Arab Spring, which resulted in the overthrowing of regimes in Egypt and other countries in West Asia and North Africa, the Saudi monarchy is making a renewed push to reduce unemployment. A study conducted by the Saudi Central Department of Statistics and Information fixed the unemployment rate in the country last year at 12.2%. That meant that more than 588,000 people were without jobs. The Nitaqat system is a process designed to boost employment of locals. The deadline for implementing the system ended on March 27.
FICCI secretary general A Didar Singh said that since the interest of Indians working in Saudi and their dependents would be impacted the matter required immediate attention.
"As reported, currently, there are 3, 40,000 firms, which do not have any Saudi employee. If we take an average of 2 to 3 Saudi nationals to be employed by each firm following the Nitaqat Law, this may have the possibility of displacing some half to one million expatriates, if more jobs are not simultaneously created. A large numbers of Indian workers are employed in Saudi Arabia and according to data of 2011, this includes around 570,000 Keralites who account for a total remittance of Rs 55,000 crore. This shows the important role the NRI community plays in the state and the possible impact this change in law could have,'' Singh said.
Kerala CM Oommen Chandy has announced that a rehabilitation package will be introduced but that has done little to bring down the panic within the worker community. There are fears that the system could also impact small-scale investments.
India hopes to stall Saudi Arabia labour law - The Times of India
The bulk of the workers come from Kerala and Andhra Pradesh and the state governments are under immense pressure. Indians in Saudi Arabia have been remitting around $3.5 billion annually. This is the largest amount of inward flow of foreign exchange from any single country. Around 1.5 million Indians are working in Saudi Arabia, of whom around 85% are in the blue-collar category.
Sources in the MOIA said that efforts will be made by India to get Saudi Arabia to stagger the implementation of the programme. "We hope to convince the Saudi authorities to give some time for the workers who are being laid off under the new law to find employment in a neighbouring country or at least make arrangements for their return,'' a source said.
After the Arab Spring, which resulted in the overthrowing of regimes in Egypt and other countries in West Asia and North Africa, the Saudi monarchy is making a renewed push to reduce unemployment. A study conducted by the Saudi Central Department of Statistics and Information fixed the unemployment rate in the country last year at 12.2%. That meant that more than 588,000 people were without jobs. The Nitaqat system is a process designed to boost employment of locals. The deadline for implementing the system ended on March 27.
FICCI secretary general A Didar Singh said that since the interest of Indians working in Saudi and their dependents would be impacted the matter required immediate attention.
"As reported, currently, there are 3, 40,000 firms, which do not have any Saudi employee. If we take an average of 2 to 3 Saudi nationals to be employed by each firm following the Nitaqat Law, this may have the possibility of displacing some half to one million expatriates, if more jobs are not simultaneously created. A large numbers of Indian workers are employed in Saudi Arabia and according to data of 2011, this includes around 570,000 Keralites who account for a total remittance of Rs 55,000 crore. This shows the important role the NRI community plays in the state and the possible impact this change in law could have,'' Singh said.
Kerala CM Oommen Chandy has announced that a rehabilitation package will be introduced but that has done little to bring down the panic within the worker community. There are fears that the system could also impact small-scale investments.
India hopes to stall Saudi Arabia labour law - The Times of India
