Expatriates needn't panic over oil downturn, says expert

Thiruvananthapuram: The downturn in global oil industry, its deepest since the 1990s, is no cause for panic among people from Kerala living and working in the Middle East, an international migration expert said.

The downturn might, however, have some impact on those who are employed in the higher echelons of the job market, S. Irudayarajan, who heads the migration department at the Centre for Development Studies here, told IANS.

"I was in Qatar in December and I found that things are the same. There was nothing that I could attribute to oil prices dropping to rock bottom levels. I was told that the construction sector also did not feel the pinch," he said.

The price of a barrel of oil has fallen more than 70 percent since June 2014, hitting the earnings of oil companies and forcing them to decommission their rigs, cut investment in exploration and production, and fire their workers.

"Kerala's remittances mostly come from the millions of unskilled and semi-skilled expatriate workers who religiously send their hard earned money back to the state," said Irudayarajan who has been studying migration for the past quarter of a century.

His latest study shows that 90 percent of Kerala's 23.63 lakh expatriate workers are in the Middle East, with the UAE accounting for 38.7 percent of them and Saudi Arabia 25.2 percent.

Data bear out Irudayarajan's stand that there is no reason to expect the downturn would have a big impact on Kerala's expatriate workers and the remittances economy.

The non-resident Indian (NRI) deposits in banks in Kerala surged to Rs.1,21,619 crore in September 2015 from Rs.80,809 crore in September 2013, according to the latest banking statistics.

Moreover, not all money earned overseas is being sent back home, he points out.

A large number of Kerala's expatriates also park their excess funds elsewhere and they are always looking to move to the US, Ireland, Canada, Australia and New Zealand, Irudayarajan said.

There is still a need, however, for the central or state governments to do a study as to whether there would be a direct impact on the overall migration trends, he said.

"A study would be the best thing to be done because then one knows where one stands and can work out medium and long term plans," added Irudayarajan.