Gulf jobs: 7 million Indians

Saudi Minister of Oil and Mineral Resources Ali al-Naimi (centre), speaks to reporters in Doha, Qatar, on Feb 16, 2016.
Saudi Minister of Oil and Mineral Resources Ali al-Naimi (centre), speaks to reporters in Doha, Qatar, on Feb 16, 2016. PHOTO: EPA

The plunge in oil prices has led to growing alarm about job security among millions of foreign workers in the oil-rich Gulf region - many from India and the Philippines - who remit billions home annually. They are already bracing for leaner times.

Some seven million Indians work in the Gulf countries in everything from banking to construction and real estate. Annually, they send a staggering US$40 billion (S$56.2 billion) back home. Thus the economic impact of cutbacks in the Gulf will be substantial, particularly on the southern state of Kerala which has more than 2.5 million people working in the region.

So far, plummeting oil prices have not hurt such remittances. But people living in the Gulf told The Straits Times that there is a growing sense of insecurity, although it has not yet reached a crisis point. Still, some people have already lost their jobs or seen delays or even cuts in their pay cheques.

"It is not yet a major problem. I don't see a lot of people coming back. In Qatar (for instance), some people lost their jobs but they are staying on with their own money because they have children who need to complete their school year,"' said Professor Irudaya Rajan at the Centre for Development Studies in Kerala.

Qatar Petroleum and its subsidiaries last year laid off more than 3,000 people, which included Indians. "I am not sure it will have a large-scale impact," said Prof Rajan. "But we have to wait and watch if this trend continues for some time."

Mr K. V. Shamsudheen, chairman of the UAE-based Pravasi Bandhu Welfare Trust, said: "Some people will lose (their) jobs especially in the petroleum companies, which, when there was a bonanza, were paying high salaries... But there is no panic. Like any other crisis, people are a little more careful with their financial resources."'

Still, the Associated Chambers of Commerce of India warned that the crude oil price crash could affect fresh recruitment and impact remittances. It has urged the government to keep a contingency plan in place.

"With a severe economic pressure in all these oil-producing nations, the expatriates mostly in the low-income and labour-oriented sectors, like construction, hotels and restaurants, would feel the heat in terms of wage cuts, lay-offs and the terms of employment deteriorating," the body said in a release last month.

Kerala legislator K. V. Abdul Khader, who is also general secretary of the Kerala Pravasi Sangam which deals with the welfare of those working in the Gulf, said 5,000 people from the state working in different sectors had returned home in the last three months. But it was unclear if this was a fallout of the oil crisis.

"We have information some Gulf countries like Qatar and Saudi Arabi have sent back labourers," he said. "We are afraid more people will come back. The decision to impose tax will also have an impact."

Still Mr Shamsudheen noted: "The Indian community has survived eight crises, including the invasion of Kuwait, and has continued to grow."

A version of this article appeared in the print edition of The Sunday Times on February 21, 2016, with the headline 'Gulf jobs: 7 million Indians'. Print Edition | Subscribe