In Dubai slowdown, remittances under pressure

Mon Jan 12, 2009 4:19am EST
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By Amran Abocar

DUBAI (Reuters) - Shalu, a 33-year-old Indian, paid 50,000 Indian rupees ($1,000) to an agency which shipped him to a construction job in Dubai on what was to be a three-year contract. Last December he was laid off after just one year.

His company told him and about 250 other workers the work had dried up.

As signs of a deep downturn in the Gulf state's once-buoyant property market multiply, those migrant workers who aren't forced to return are having problems sending money home, and their declining remittances may be a significant drag on the economies of South Asia.

Shalu, who asked to remain anonymous to protect his chances of future employment, had been sending funds back to his wife and six-year-old son, but is now trying to put together the cash for another agency fee to try his luck in Saudi Arabia.

"It's a big problem," he said by telephone from his village in Kerala, India. "They gave me sudden notice and no release (to find other work)."

A lavish trade and tourism hub in the United Arab Emirates, Dubai is a prime destination for unskilled workers, many of whom spend hours on dusty construction sites, live in cramped desert labor camps and earn about 1,500 dirhams ($408.4) a month.

There is no current official data on the number of migrants but Human Rights Watch estimates there are three million from India, Pakistan and Bangladesh in the Gulf Arab state, the vast majority of them in the construction sector.

The laborers, mostly from South Asia, swarm over building sites for landmarks such as the Burj Dubai, the tallest building in the world, and Dubai's seemingly endless high-rises.   Continued...

<p>A foreign worker sleeps on the sidewalk near a construction site in Dubai, United Arab Emirates, in this November 13, 2006 file photo. REUTERS/Ahmed Jadallah/Files</p>