Saudi Economic Woes Leave Indian, Pakistani Workers Stranded

  • Almost 16,000 Indians, Pakistanis are stuck in Saudi camps
  • Indian Embassy distributing food to workers in Riyadh, Jeddah

Nearly 16,000 Indian and Pakistani workers have been abandoned in camps in Saudi Arabia without food and water or visas to exit the kingdom after a slowing economy forced companies to cut jobs.

A total of 7,700 Indians and 8,000 Pakistanis have been stranded, according to tallies provided Tuesday by the foreign ministries in New Delhi and Islamabad. Many were employed by construction companies battered by the downturn in oil prices that began two years ago.

As prices plummeted from more than $100 a barrel in 2014 to below $30, the Saudi government cut spending and delayed payments to contractors, who have relied on public contracts for business growth. With Brent still a relatively low $42 a barrel, growth in the Arab world’s largest economy is forecast to slow to 1.5 percent this year, the lowest level since 2009, according to data compiled by Bloomberg.

Building projects have fallen off dramatically along with the drop in oil revenue. Construction contracts shrank by about 50 percent in the first quarter from the same period a year earlier, according to data published by Jeddah-based National Commercial Bank. The government didn’t award any contracts during the first quarter in 2016 or the fourth quarter of last year, the bank said.

Food Relief

More than 4,050 workers from Saudi Oger, a Riyadh-based construction and management company, are stranded, according to the Indian Foreign Ministry. The Indian Embassy is providing food to workers in 20 camps in Riyadh, Jeddah and Dammam, the ministry said.
India’s government also sent a top diplomat, Vijay Kumar Singh, to Saudi Arabia to assist stranded workers. Pakistani Prime Minister Nawaz Sharif said his government will help the stranded workers “in all possible ways.”

Summer temperatures can climb above 50 degrees Celsius in Saudi Arabia, worsening the plight of the workers.

The Saudi government has issued orders to let Indian workers find other employers and to allow them to get new visas, the official Saudi Press Agency reported, citing Abdullah al-Olayan, the director general of the Ministry of Labour in the Mecca region. The ministry is providing facilities for 2,500 affected Indian workers, the news service reported.

Calls to the Saudi Ministry of Labor and Saudi Oger were not returned.

Saudi Arabia is India’s fourth-largest trading partner and Pakistan’s third, according to data compiled by Bloomberg. Pakistani workers in Saudi Arabia sent home $5.97 billion in the last fiscal year ended in June from Saudi Arabia, making the kingdom the top remittance provider to Pakistan, according to data from the State Bank of Pakistan.

Pakistan exported about 1 million workers worldwide in 2015, more than half of them to Saudi Arabia, according to Foreign Ministry spokesman Nafees Zakaria. A total of 1.8 million Pakistanis are employed in the kingdom.

Before it's here, it's on the Bloomberg Terminal.
LEARN MORE