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Mutual Necessity Relationship between the Gulf  and India

Mutual Necessity Relationship between the Gulf and India

In the World Economic Forum’s Global Agenda, stories on Migration and Workforce and Employment abound. This one on India‘s record-breaking diaspora is the latest. It is doubly interesting because of a) the significant presence of more than 8 million NRIs (non-resident Indians) in the Gulf and b) it is reflective of a mutual necessity relationship between the Gulf and India.

In 2019, remittance flows to low- and middle-income countries are expected to reach $550 billion, becoming their largest source of external financing. ‘Indians abroad sent back $80 billion, making the country the leading recipient of funds from overseas.’ Per Image above: REUTERS/Pawan Kumar.

Katharine Rooney, Senior Writer, Formative Content, the Indian diaspora elsewhere seem to be not that dissimilar to that of the GCC’s.

Excerpts of the WEF article:

India’s record-breaking diaspora in numbers

When Indian Prime Minister Narendra Modi visits the United States, he is among compatriots – 4.4 million of them.

India has the largest diaspora in the world, with around 18 million of its citizens living in other countries. The US is their top destination: in 2017, people of Indian descent made up 1.3% of the American population, and they are the most successful immigrants in the country.

As economist Nirvikar Singh says in an interview with the University of California Santa Cruz, “Indian entrepreneurship is a very important engine of economic growth.” The co-author of a book on the Indian diaspora in the US notes that 8% of the founders of high-tech companies are Indian. With Sundar Pichai running Google and Satya Nadella the CEO of Microsoft, Indians play a prominent role in some of America’s biggest tech firms.

Indian-Americans watch Narendra Modi in Madison Square Gardens in New York. The US is a key destination for Indian emigrants.
Image: Reuters/Lucas Jackson

Economic factors lure large numbers of Indians to the Persian Gulf, particularly the United Arab Emirates (UAE), which is home to 3.1 million Indians. The number of Indians living in the UAE and other countries in the region such as Saudi Arabia and Oman increased fourfold in the space of a decade, from 2 million in 2005 to more than 8 million in 2015.

It’s a numbers game

Despite a sizeable outflow, India is still home to 1.39 billion people – and by 2027, it’s set to overtake China as the world’s most populous country. While there has been progress in reducing extreme poverty levels, there are still 176 million people living in poverty in India, and money remitted by expatriates is an important part of economic development and growth. In 2018, Indians abroad sent back $80 billion, making the country the leading recipient of funds from overseas.


According to the Reserve Bank of India, inward remittances helped to finance 43% of the country’s trade deficit in 2017-18. They also help to meet the needs of the poor by covering the cost of daily living expenses and allowing people to invest in business and education.

Countries with the largest diasporas – India has the world’s biggest, with nearly 18 million people living abroad.
Twenty countries or areas of origin with the largest diaspora populations (millions) Image: UNDESA

The ever-changing direction of migration

With a significant spike in emigration since 2015, India has overtaken other countries that once represented significant migrant populations – many escaping political upheaval or conflict.

But there has been a huge jump in migration from Syria, with more than 5.6 million fleeing the country since war broke out in 201, and a steady rise in the number of people leaving Pakistan, where the government has encouraged outward migration as a way to combat unemployment, reduce poverty and earn foreign exchange through remittances.

Migration Explore the latest strategic trends, research and analysis This article is part of the India Economic Summit

Become a Member or Partner to participate in the Forum’s year-round annual and regional events. Contact WEF now.

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$466 billion as remittances from migrant workers worldwide in 2017

$466 billion as remittances from migrant workers worldwide in 2017

Are Migrant Workers Humans or Commodities?

By Thalif Deen    

UNITED NATIONS, May 1 2019 (IPS) – The United Nations has estimated a hefty $466 billion as remittances from migrant workers worldwide in 2017—and perhaps even higher last year.

These remittances, primarily from the US, Western Europe and Gulf nations, go largely to low and middle-income countries, “helping to lift millions of families out of poverty,” says UN Secretary-General Antonio Guterres.

But most of these migrant workers are known to pay a heavy price, toiling mostly under conditions of slave labour: earning low wages, with no pensions or social security, and minimum health care.

As the United Nations commemorated Labour Day on May 1, the plight of migrant workers is one of the issues being pursued by the Geneva-based International Labour Organization (ILO), a UN agency which celebrates its centenary this year promoting social justice worldwide.

In a December 2018 report, the ILO said: “If the right policies are in place, labour migration can help countries respond to shifts in labour supply and demand, stimulate innovation and sustainable development, and transfer and update skills”.

However, a lack of international standards regarding concepts, definitions and methodologies for measuring labour migration data still needs to be addressed, it warned.

But much more daunting is the current state of the migrant labour market which has been riddled with blatant violations of all the norms of an ideal workplace.

Ambassador Prasad Kariyawasam, a member of the UN Committee on Migrant Workers, told IPS rising populist nationalism world over is giving rise to rhetoric with unfounded allegations and irrational assessments of the worth of migrant workers to economies of many migrant receiving countries in the world.

Since migrant workers remain voiceless without voting or political rights in many such receiving countries, they are unable to mobilize political opinion to counter assertions against them, he said.

“And migrant workers are now being treated in some countries as commodities for import and export at will, not as humans with rights and responsibilities,” said Ambassador Kariyawasam, a former Permanent Representative of Sri Lanka to the United Nations.

Unless these trends are reversed soon, he warned, not only human worth as a whole will diminish, but it can also lead to unexpected social upheavals affecting economic and social well-being of some communities in both sending and receiving countries of migrant workers.

At a UN press conference April 10, ILO Director-General Guy Ryder said the ILO Centenary is a time to affirm with conviction that the mandate and standards set by the Organization remain of extraordinary importance and relevance to people everywhere.

He called for a future where labour is not a commodity, where decent work and the contribution of each person are valued, where all benefit from fair, safe and respectful workplaces free from violence and harassment, and in which wealth and prosperity benefit all.

Tara Carey, Senior Content & Media Relations Manager at Equality Now told IPS poverty and poor employment opportunities are a push factor for sex trafficking.

There are many cases in which women and girls in African countries are promised legitimate work and are then trafficked into prostitution. This happens within countries, across borders, and from Africa to places in Europe and the Middle East, she pointed out.

And recently, the police in Nigeria estimated 20,000 women and girls had been sold into sexual slavery in Mali:

“The new trend is that they told them they were taking them to Malaysia and they found themselves in Mali. They told them they would be working in five-star restaurants where they would be paid $700 per month.”

The number of migrants is estimated at over 240 million worldwide. And an increasingly large number of countries, including Saudi Arabia, Qatar, Kuwait, Bahrain and the United Arab Emirates (UAE), are home to most migrant workers from Asia.

In a background briefing during a high-level plenary meeting of the General Assembly in April, the ILO said conditions of work need to be improved for the roughly 300 million working poor – outside of migrant labour — who live on $1.90 a day.

Millions of men, women and children are victims of modern slavery. Too many still work excessively long hours and millions still die of work-related accidents every year.

“Wage growth has not kept pace with productivity growth and the share of national income going to workers has declined. Inequalities remain persistent around the world. Women continue to earn around 20 per cent less than men.”

“Even as growth has lessened inequality between countries, many of our societies are becoming more unequal. Millions of workers remain disenfranchised, deprived of fundamental rights and unable to make their voices heard”, according to the background briefing.

In its 2018 review of Human Rights in the Middle East & North Africa, the London-based Amnesty International (AI) said there were some positive developments at a legislative level in Morocco, Qatar and the UAE with respect to migrant labour and/or domestic workers.

But still migrant workers continued to face exploitation in these and other countries, including Bahrain, Jordan, Kuwait, Lebanon, Oman and Saudi Arabia, in large part due to kafala (sponsorship) systems, which limited their ability to escape abusive working conditions.

In Morocco, the parliament passed a new law on domestic workers, entitling domestic workers to written contracts, maximum working hours, guaranteed days off, paid vacations and a specified minimum wage.

Despite these gains, the new law still offered less protection to domestic workers than the Moroccan Labour Code, which does not refer to domestic workers, AI said.

In Qatar, a new law partially removed the exit permit requirement, allowing the vast majority of migrant workers covered by the Labour Law to leave the country without seeking their employers’ permission.

However, the law retained some exceptions, including the ability of employers to request exit permits for up to 5% of their workforce. Exit permits were still required for employees who fell outside the remit of the Labour Law, including over 174,000 domestic workers in Qatar and all those working in government entities.

In the UAE, the authorities introduced several labour reforms likely to be of particular benefit to migrant workers, including a decision to allow some workers to work for multiple employers, tighter regulation of recruitment processes for domestic workers and a new low-cost insurance policy that protected private sector employees’ workplace benefits in the event of job loss, redundancy or an employer’s bankruptcy, according to AI.

Meanwhile, as the ILO pointed out in a report in May 2017, current sponsorship regimes in the Middle East have been criticized for creating an asymmetrical power relationship between employers and migrant workers – which can make workers vulnerable to forced labour.

Essential to the vulnerability of migrant workers in the Middle East is that their sponsor controls a number of aspects related to their internal labour market mobility – including their entry, renewal of stay, termination of employment, transfer of employment, and, in some cases, exit from the country, the report noted.

Such arrangements place a high responsibility – and often a burden – on employers. To address these concerns, alternative modalities can be pursued which place the role of regulation and protection more clearly with the government.

This report demonstrates that reform to the current sponsorship arrangements that govern temporary labour migration in the Middle East will have wide-ranging benefits – from improving working conditions and better meeting the needs of employers, to boosting the economy and labour market productivity.

Meanwhile, in its ”Century Ratification Campaign”, ILO has invited its 187 member States to ratify at least one international labour Convention in the course of 2019, with a commitment to apply a set of standards governing one aspect of decent work to all men and women, along with one political commitment supporting sustainable development for all.

The writer can be contacted at thalifdeen@ips.org

Related :

Expatriate workers continue increasing in the Arabian Gulf

Expatriate workers continue increasing in the Arabian Gulf

Migrant or expatriate workers continue adding to the labour force of oil-rich Gulf due to mega-construction projects, UN data shows.  Al Jazeera posted this article dated 20 Dec 2018 elaborating on a situation known to all since the advent of oil.

Gulf Arab blue-collar workforce continues to grow: UN

by James Reinl

Blue-collar migrant workers continue adding to the labour force of the oil-rich Gulf, skewing long-standing efforts by its leaders to increase the percentage of its own citizens in the workforce, data of the UN’s International Labour Organization (ILO) shows.

Figures released this month in a 78-page study, ILO Global Estimates on National Migrant Workers, showed that the proportion of migrants in the eastern Arab region’s workforce ballooned by 5.2 percent from 2013 to 2017, mostly in the construction sector.

Migrants now make up 40.8 percent of the workforce across a 12-nation region that includes the Gulf Cooperation Council (GCC) bloc of Saudi Arabia, the United Arab Emirates (UAE), Qatar, Kuwait, Bahrain and Oman.

This is a much higher proportion than other rich regions that attract some of the world’s estimated 164 million migrant workers. In comparison, migrants make up only 20.6 percent of the labour force in North America, and 17.8 percent in Europe.

In Dubai, Doha and other Gulf boomtowns, foreigners make up as much as 90 percent of workers, according to older figures. The ILO did not have data on separate countries for this month’s report; Ryszard Cholewinski, the ILO’s Beirut-based expert on migrant workers, said that figures provided by Gulf governments are often incomplete.

Blue collar jobs

The increase in labour flows to Gulf states these past five years was driven mainly by mega-construction projects, including pavilions for Expo 2020 Dubai and the FIFA World Cup 2022 stadiums being built across Qatar, said Cholewinski.

Demand has also grown for maids, gardeners, drivers and other domestic staff, he added. In particular, more foreign carers are being hired to look after a growing number of elderly folks in their homes, as the Gulf population ages.

“The demand for male workers in the Arab states explains the sharp increase in the share of migrant workers in this region. Many of these workers are manual labourers, located mostly in the construction sector,” Natalia Popova, an ILO labour economist, told Al Jazeera.

“Possible other reasons for the increase in the high share of migrant workers may include the increasing demand for domestic workers, both male and female, as well as for migrant workers in the hospitality sector.”

Nationalisation efforts

While data on nationalisation efforts is skewed due to the sheer amount of blue-collar migrants, Gulf leaders have long sought to boost the numbers of their working citizens, mainly in the white-collar workforce.

However, state-led hiring drives, with such names as Qatarisation, Emiratisation and Saudisation, have had only limited success, particularly in the private sector, according to the ILO.

“Many of these nationalisation policies are not really having any impact. It’s one of the region’s big challenges,” Cholewinski told Al Jazeera.

“There’s a lot of rhetoric on nationalisation in for example Saudi Arabia’s Vision 2030 agenda. But in practice, this is going extremely slowly.”

Al Jazeera contacted the UN missions of all six Gulf states by email and telephone over the course of several days, but was not able to get a comment on this issue.

While each Gulf nation faces different challenges when it comes to nationalisation, many Gulf citizens loathe taking jobs in private companies, which cannot compete with the pension plans, generous holidays and shorter working hours in the cushy jobs-for-life enjoyed by civil servants.

This can lead to odd distortions. A visitor to Dubai, the UAE’s tourism hub, can spend their whole week-long vacation being served by migrant workers in shops, taxis and eateries, and the only Emirati they meet is a passport-stamping immigration clerk at the airport.

Last month, the UAE launched it’s so-called Citizen Redistribution Policy to temporarily shift civil servants into private sector jobs. It also rolled out training schemes for Emiratis and online recruitment tools.

In recent months, Riyadh has introduced rules requiring shops to have Saudis in at least 70 percent of sales jobs. Expat workers pay monthly fees for their spouses and children, employers pay similar penalties for foreign employees.

Saudi Crown Prince Mohammed bin Salman’s ambitious Vision 2030 agenda aims to overhaul the Saudi economy by massively expanding the healthcare, education, recreation and tourism sectors and slash the high unemployment rates for young Saudis.

John Shenton, chairman of the Chartered Institute of Building’s Novus initiative, which supports construction jobs in Dubai, told Al Jazeera that Gulf nationalisation schemes were bearing fruit.

In some state-regulated sectors, such as banking, legal and financial services, the number of local staff has grown, Shenton said. “If the goal is to get more Emiratis in the workforce then it’s having some effect,” said Shenton. “However there are other factors that will mean that those efforts may not be reflected in the data.”

These gains are dwarfed by the mass-recruitment of foreign construction workers to build the skyscrapers, malls and artificial islands for which the region is famous, he added.

“At a site level, the chaps in safety boots and hard hats will always be from the subcontinent or South Asia,” Shenton said.

“At the engineering and supervisory level, the skill set required can’t be satisfied by the number of local graduates. The volume of work being undertaken and the discreet programme dates associated with projects like Qatar 2022 necessitate our hosts resourcing from overseas.”

Melissa Roza, a headhunter at a Dubai-based recruitment firm, said nationalisation schemes had made gains in some white-collar jobs, but that state-set hiring quotas and penalty fees were also hurting these sectors.

Banks in the UAE often prefer to pay fines for hiring foreigners than to cover the recruitment costs involved in hiring an Emirati, training them up and meeting their high salary expectations, she said.

Executives have also found workarounds by hiring migrants via outsourcing firms, which do not affect the quota count, added Roza, whose name was changed so she could talk frankly on a hot-button issue. 

Follow James Reinl on Twitter: @jamesreinl

  • Inside Story happen when the Gulf countries’ oil runs out?

SOURCE: Al Jazeera News

  • READ MORE

UN clears Qatar over treatment of migrant workers

INFOGRAPHIC

Pakistan’s ties with the Gulf countries

The Arab world in attracting Foreign Direct Investment

The Arab world in attracting Foreign Direct Investment

WAM, the Emirates News Agency posted this article April 8th, 2018 about the UAE with the second-largest Arab economy, is leading the Arab world in attracting Foreign Direct Investment, (FDI). It is known that Dubai leads Arab start-ups but the recent Saudi Arabian reforms being engaged in the non-oil local activities may possibly alter that.
In the meantime, the UAE bankruptcy laws and company possible total foreign ownership are no longer hampering but rather allow total foreign contribution to the sought after investment in the local economy.

Sultan bin Saeed Al Mansouri, Minister of Economy

UAE leads in attracting FDI in Arab world: UAE Minister of Economy

In 2016, the UAE attracted 29 percent of the total FDI inflow in the Arab world, Sultan bin Saeed Al Mansouri, Minister of Economy, told the media ahead of the Annual Investment Meeting, AIM, taking place at the Dubai World Trade Centre from April 9th to 11th, 2018, under the theme, “Partnerships for Total Growth and Sustainable Development.”
The FDI inflow to the UAE reached AED37.8 billion (US$10.3 billion) in 2017, according to the UAE Federal Competitiveness and Statistics Authority, FCSA, up from AED35.23 billion ($9.6 billion) recorded in 2016. This raised the total FDI stock of the country to AED473.500 billion ($128.94 billion) in 2017.
“We also topped Arab countries in terms of attracting new foreign investment projects, as we attracted 4,492 foreign investment projects in the UAE, out of a total of 12,192 new investment projects in the Arab countries from 2003 to 2016, reflecting the competitiveness of the national economy at the state level in creating efficient business,” he added.
The country is also working on luring quality investments that serve its development objectives and provide additional value to the national economy.
“FDI plays a crucial role in strengthening economic growth and raising the efficiency of national economies, and the UAE is constantly adapting the best policies and economic trends to keep pace with changes in the nature and trends of foreign investments to consolidate its position as a global destination for business and finance.
“According to preliminary data from the United Nations Conference on Trade and Development, UNCTAD, global FDI flows are forecast to decline by 16 percent in 2017, from $1.81 trillion in 2016 to $1.52 trillion in 2017,” he said.
However, FDI inflows to developing economies are expected to stabilise in 2017, reaching about $653 billion, an increase of 2 percent over 2016.
“This indicates the need for countries, including the UAE, to continue their efforts to attract more investments in those sectors that add value, and to develop the appropriate policies and frameworks to make the best use of the presence of FDI to serve their development objectives,” he added.
Speaking about the Annual Investment Meeting, he said, “It is a collaborative platform for linking advanced and emerging markets and exploring potential partnership opportunities and will address obstacles facing acceleration of FDI inflow. It will also seek to explore promising investment opportunities in vital sectors, including energy, mining, manufacturing, infrastructure, logistics, agriculture, tourism and ICT.”
WAM/Elsadig Idriss/MOHD AAMIR

Latest LINKEDIN 2018 Recruiting Trends in the MENA Review

Latest LINKEDIN 2018 Recruiting Trends in the MENA Review

Here is an interesting interpretation of the latest LINKEDIN 2018 Recruiting Trends in the MENA review as published by COMMSMEA on January 22nd, 2018. The ensuing conversation is best to be followed directly on COMMSMEA’s Twitter account. To be followed. 

LinkedIn unveils the biggest game changer in hiring in MENA

By killing the transaction, these trends giving MENA companies more time to build candidate relationships, Ali Matar says.

 

Diversity has evolved to be the biggest game-changer and most embraced trend in the MENA with over half of companies are already tackling it head-on, according to LinkedIn’s annual ‘Global Recruiting Trends 2018’ report. 

80% of talent acquisition leaders and hiring managers have said that diversity is the top trend affecting how they hire, with companies prioritising diversity – gender, race, ethnicity, age, education, etc to improve culture and boost financial performance, as they are increasingly realising that diverse teams are more productive, more innovative, and more engaged.

The report has unveiled four top trends globally as well as in the MENA region which are expected to have an impact on the way we find jobs, get hired and stay engaged at work in 2018- Diversity, New interviewing tools, Data and Artificial Intelligence.

“Hiring talent has become highly transactional. Collectively these four trends are elevating recruiting to a more strategic profession. By killing the transaction, they’re giving MENA companies more time to build candidate relationships and think critically about how to win talent,” said Ali Matar, Head of LinkedIn Middle East and North Africa, LinkedIn.

More than half (58%) of hiring managers feel that interviewing innovations are ‘very’ or ‘extremely’ important to the future of hiring. Innovations such as job auditions, soft skills tests, meeting candidates in casual settings, virtual reality assessments and video interviews are gaining traction.

The new era of talent intelligence is allowing recruiting professionals to use data to influence the strategic direction of their companies and elevate their own careers. 48% of respondents have said that they see data analytics as critical to the future of hiring, with 48% identifying it as a top trend affecting how they hire.

Hiring managers in MENA are also already seeing the power of Artificial Intelligence (AI) and how it can help them work faster by automating administrative tasks, and smarter by generating insights they wouldn’t think of alone. 36% of professionals feel that AI is a top trend affecting how they go about hiring employees.

“AI is the future, but so is the human touch. AI is a huge step forward for talent acquisition, but it will never fully automate it. Companies still need people — people to persuade and negotiate, to understand candidate needs, and to build communities and cultures. These four trends are just the beginning of what we predict is a movement to make the transactional recruiter obsolete. To stay alive professionally, recruiters will have to embrace them,” Ali Matar added.

Saudi banning foreign employment in gold and jewellery shops

Saudi banning foreign employment in gold and jewellery shops

An interesting article of Gulf Business posted on December 4, 2017 on how Saudi Arabia in its multi-facetted program of “Saudization” is getting down to the nitty-gritty of specialized retail business. As if the country does have enough things to worry about these days, this recently included Saudi banning foreign employment in gold and jewellery shops. 

Saudi bans employment of foreigners in gold and jewellery shops

A deadline for businesses to employ Saudis in the sector ended on Sunday

Saudi Arabia’s Ministry of Labour and Social Development on Sunday began the process of fully nationalising jobs in the kingdom’s gold and jewellery industry.

The move, which will make it illegal to employ foreigners in the sector, follows several failed attempts to Saudise industry jobs over the last 16 years, according to Saudi Gazette.

It is estimated that the majority of the around 30,000 workers in the sector are expatriates. These are spread across 6,000 gold shops.

The nationalisation programme is expected to provide 5,000 jobs for Saudis when it is fully implemented.

The ministry is also hoping to reduce instances of businesses run by foreigners in the name of Saudis by 40 per cent.

During previous Saudisation efforts in the sector many businesses in Makkah and other cities were found to be operating under a form of fake Saudisation.

This was partly because work in the sector has proved to be unattractive to Saudi citizens, with monthly salaries averaging SAR3,000 ($800) to SAR7,000 ($1,863).

Shops found to be employing foreigners from Sunday will face a SAR20,000 ($5,324) fine for each expat worker.

Permanent inspectors have been appointed in markets and malls to punish violators.

Foreigners married to Saudi women will be exempt from the new regulation provided they remain together or have children.

The kingdom’s gold and jewellery market is estimated to be worth SAR14bn ($3.72bn).

The ministry has also issued regulation to fully Saudise other businesses and sectors as part of Saudi Arabia’s Vision 2030 reforms.

These include mobile phone shops and stores selling female-specific items.

 

Read: Gold and jewellery shops in Saudi face $5k fines