The Hindu Editorial : As The Borders Begin To Close

Title: As The Borders Begin To Close

India’s policymakers must be alive to uncertainty in migrant remittances from the West and West Asia.

What is remittance?

A remittance is a transfer of money by a foreign worker to his or her home country.
India and China have benefited from increasing globalisation and the growing movement of goods and people between countries. Consequently, they are among the largest recipients of global remittances.

• Twenty-three countries, led by India and followed by China, the Philippines, Mexico, Pakistan and Nigeria, receive over 80% of global remittances.

• However, as a share of gross domestic product (GDP), the top five recipients are smaller nations: Haiti, the Kyrgyz Republic, Liberia, Nepal and Tajikistan.

• In these low- and middle-income countries, remittances have helped lift millions out of poverty and unemployment and enhanced their standard of living and human development.

Remittances in India

• Kerala, receives remittances equaling 36.3% of its gross State domestic product.

1991 = $2.1 billion
2014 = $70.4 billion
2015 = $68.9 billion
2016 = $62.7 billion
2017 = $65.4 billion

• India receives about 56% of its remittances from migrants in West Asia, with the remainder from mainly North America and Europe.

• Rapid changes in the economy and the sociopolitical climate in West Asia have had an impact on remittances. Additionally, developments such as Brexit and the Trump presidency in the U.S. have further complicated matters.

The case of West Asia

• The theme of nationalisation took over the Arab world. Along with declining oil prices and sluggish regional economies, especially in the Gulf Cooperation Council (GCC) countries, the regional governments decided to prioritise filling their workforce with their nationals.

• Oman began “Omanisation”, a policy aimed at replacing expatriate workers with trained Omani personnel.

• The other four, Bahrain, Kuwait, Qatar and Saudi Arabia, have tightened their immigration policies .

• In 2011, the Saudi government enacted “Saudisation”, officially known as Saudi Nationalisation Scheme or Nitaqat system in Arabic, with a view to reducing unemployment among Saudi nationals.

Kerala’s remittance economy

• Since the 1970s, the Gulf region has attracted millions of Malayalis, with remittances amounting to over 36% of the State’s GDP.

• In 2016, for the first time in 20 years, the Malayali migrant community got smaller by 10% to 2.2 million.

• Unskilled and semi-skilled migrants from Kerala were not only replaced by migrants from other Asian countries such as the Philippines and Nepal, but also by other Indian migrants from Bihar, Rajasthan and Uttar Pradesh.

• If the State does not identify alternative means of employment and revenue generation for its labour force as well as returned emigrants, it will turn out to be problematic.
Conclusion

• The negative reaction to migration among developed countries is likely to spread. Therefore, it is imperative that developing nations that have relied on remittances formulate strategies to compensate for the restricted flow of remittances that is expected in the near future. India must remember that with the rapid and large-scale economic and cultural changes in West Asia, Europe or the U.S., the future of emigration and remittances remains uncertain.

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