Impact on remittances when workers going abroad are four times less than returning

Kathmandu. 

With the outbreak of the corona virus (Covid-19), the number of young people going abroad for foreign employment has decreased by two-thirds compared to the past.

As the number of returnees is more than four times more than the number of those going abroad, it is seen that remittances entering Nepal will be affected in the future.

According to economists, the imbalance of migrant and returning workers could lead to a drop in remittance inflows in the future, which could lead to problems for the economy as a whole. He is of the view that the economic policy of the country should be focused on creating internal employment and increasing productivity to bring it out of dependence on remittances.

According to the Department of Foreign Employment, 2 lakh 78 thousand 354 Nepalis have returned home from foreign employment till Falgun 14, in the fiscal year of 2077/78. The number of people going abroad for employment during this period is limited to 72,178.

During this period, 45 thousand 124 people have flown again with labor permit. 23 thousand 996 people have received new approval. 2,626 have gone abroad through legalization. This number of foreign youths is about 65 percent less than last year.

At present, an average of 320 Nepali workers are going abroad daily while an average of 1,237 workers are returning home. In the past, the number of foreigners was more than the number of returnees.

Now, when the number of foreign workers decreases, the process of returning abroad after the expiry of the contract period has become regular. As the number of Nepalis working abroad decreases, remittance income is bound to shrink.

According to economists, the imbalance in the number of workers going abroad and returning home will have a serious impact on the arrival of remittances in the near future.

The wave of Nepali youth going to Malaysia and the Gulf for foreign employment has been going on for two decades. Demand for this specialty has grown significantly as a result of recent corporate scandals.

Due to the problems in the global economy after the epidemic and the health risks of taking foreign workers, labor destination countries have cut off a large number of labor supplies.

According to Kumar Prasad Dahal, Director General of the Department of Foreign Employment, Malaysia has not started taking workers in new demand. Despite some demand in Saudi Arabia, labor supply has been affected due to administrative complexities. The UAE's private sector is not allowed to hire foreign workers. Labor demand is low in Qatar, Oman and Bahrain.

"The resurgence of the Malaysian and Gulf economies is linked to the opportunities and incomes of our workers," he said.

If the government does not come up with a policy to get rid of the dependence on remittances, it will affect the economy. Pandey explains.