How recent changes in immigration policies in Middle East affect India? What India should do to mitigate those effects?

The world is now haunted with fears of anti-globalisation. The economic slowdown, increasing unemployment, raising nationalism has given calls for protectionism and anti-globalisation. Middle East whose economy was driven by the oil is affected badly due to global slowdown. Hence there are increasing demands for nationalisation of workforce.
This has led to changes in immigration policies this will affect India in following ways:

• Incentivising the employment of locals will lead to job loss of the migrants. Hence they would be forced back to return leading to decreased remittances.
• Largely the migrants are employed in blue collar jobs, their return to the country at a time when there is decreasing investments will result in increasing un-employment due to lags in employment creation.
• The reduction in flow of the remittance may adversely impact the current account deficit. This is not a welcome sign for the economy which is facing the challenge of decreasing exports.
• The reduced remittances will also reduce the buying power of the population as the large numbers of population are dependent on the remittances for their livelihood. This would give rise to cyclic events like reduced demand, reduced production, reduced revenue to the government, reduced investments etc.

As India aims to emerge as a superpower it cannot allow other countries to decide on its destiny. India must adopt the mitigating strategies by:

• Skilling the blue coloured workers so has to enhance their employability. One of the schemes towards this purpose is Pravasi Kaushal Vikas Yojana, which can be implemented carefully.
• Boosting entrepreneurship as to create Job creators. So that there are avenues for absorption for the returning migrants.
• Increased investments in human resource so that demography of the country can be used as an instrument to boost growth and reap the benefits of demographic dividend.
• Integrating Make in India with Make for India. India has huge diversity and this diversity creates a challenge. By transforming this challenge into opportunity India can create new avenues for growth.

India has a benefit of 3D, Democracy, demography and demand. This can be an asset for India to reinvent its strategies for ensuring growth in the era of increasing protectionism.

Topics: GS-II: India's Foreign Policy Neighbourhood International Relations