Saudi Arabia’s decision to limit the stay of migrant workers to a maximum period of six years will affect 100,000 plus Nepali workers working there, according to labour outsourcing agencies.

Saudi Arabian Labour Minister Adel Fakieh said on Tuesday that foreign workers who have stayed six years in the country would not have their work permits renewed as part of their plan to create jobs for Saudi nationals.

Currently, there are eight million foreign workers in Saudi Arabia, including an estimated 500,000 Nepalis staying legally and illegally. There is no precise data regarding the number of Nepalis working there and their length of stay. According to the Department of Foreign Employment (DoFE), a total of 314,793 Nepalis have left for employment in Saudi Arabia through outsourcing agencies and personal contacts during the last 10 fiscal years (1999-00 to 2009-10). “The Saudi policy on expat workers might force an estimated 100,000 plus Nepali workers to return home,” said Kumud Khanal, general secretary of the Nepal Association of Foreign Employment Agencies. It might affect remittance inflow for some time, however, it might also open the door to fresh labour demand, he added.

Normally, Nepali job seekers go to Saudi Arabia with a two-year work permit. However, many workers have continued working after their permit has expired by getting their visa extended through their employers. Chandra Man Shrestha, acting director general of the DoFE, said that some Nepalis had been working in Saudi Arabia for 12 years. “They complete two years, come home and leave again by getting their visa extended,” he added. In the first 10 months of the current fiscal year (mid-July to mid-May), Saudi Arabia has hired 52,626 Nepali workers.

Following Saudi Arabia’s plan to limit work permits, the Ministry of Labour and Transport Management has written to the Nepali embassy in Saudi Arabia to acquire more information. “Since we have not been notified about such a move formally, we are trying to find out the facts,” said ministry spokesperson Purna Chandra Bhattarai.

News reports said that the Saudi government would limit the stay of foreign workers, mainly unskilled, to six years for certain categories of firms while it will also ban visa renewals for disobedient companies. Many Saudi nationals work in the public sector; however, in contrast to other Gulf countries like Kuwait, citizens do not automatically get a job because of a rapidly rising population.

Meanwhile, following the Saudi government’s policy towards migrant workers, Saudi economists have stated that the decision would have negative effects on the economy and could lead to higher inflation. They said that if the government implemented the plan strictly, more than 210 firms would shut down in the next three years because of labour problems as private firms prefer to hire cheaper workers from Asia.

In 1994, the Saudi government had began a “Saudisation” plan, setting quotas for the number of nationals private firms must hire. The programme failed to achieve a significant increase in the participation of nationals in the private sector, where Saudis still account for only 10 percent of the employees, according to media reports. Almost 70 percent of Saudis are under the age of 30, and the population is increasing by around 2.4 percent annually.

Published on: 3 June 2011 | The Kathmandu Post