Trouble in paradise

Print edition : March 14, 2008

Indias efforts to fix a minimum wage for unskilled Indian workers in Bahrain face strong resistance from employers.

in Dubai

Workers return to the Pauling Middle East Labour Camp in Jebel Ali, UAE, after being in jail for a few days last October. About 4,000 South Asians, including many Indians, were jailed for striking work.-KAMRAN JEBREILI/AP

INDIAS decision to enforce a minimum monthly wage of 100 Bahrain dinars (BD 100, or around Rs.10,500) for unskilled Indian workers in Bahrain from March 1 is facing resistance. Managements of major construction companies are citing this decision as the cause of the growing labour unrest in the Gulf state.

Stefanos G. Zachariades, managing director of the construction firm G.P. Zachariades (GPZ), blamed the Indian Embassys announcement in this regard for the six-day agitation in his company, which involved more than 2,000 workers.

Since early February, at least six labour strikes have hit Bahrains construction sector. As agitations threatened to gather momentum, more than 100 contractors met at the Bahrain Chamber of Commerce and Industrys headquarters in Manama to address the problem. Indias decision has also fuelled the debate in business circles on whether labour imports from countries other than India such as China, Nepal and Vietnam should be given fresh consideration.

Unfazed by the storm of protests from employers and a section of the political elite, Indias Ambassador to Bahrain, Balkrishna Shetty, said that enforcement of a minimum wage for Indian workers had become a necessity. It was decided to fix a minimum basic wage level for unskilled and other categories of Indian workers in the Gulf because of the rising cost of living and the falling value of various foreign currencies against the Indian rupee, said Shetty at a press conference.

He added: It is the responsibility of the Indian government to protect its workers in the Gulf from the adverse effects of the falling value of dollar. In Bahrain, the dinar is linked to the dollar and the value of the rupee has gone up by at least 20 per cent in recent months. This means the savings of the Indian worker here has also dropped substantially. In a conversation with Frontline, Shetty explained that the Government of India had been working on a major initiative to ensure that Indian blue-collar workers received fair and timely wages, based on watertight contracts.

Nevertheless, several other issues also need to be addressed in the future. Among them, the sponsorship system that prevails in Gulf countries requires an urgent review. Under the sponsorship system, employers have the right to terminate the jobs of expatriates and prevent them from seeking fresh employment unless they accept hard conditions. It is also a common practice for employers to seize the passports of workers in order to ensure their loyalty.

India has signed memoranda of understanding with Kuwait and the United Arab Emirates (UAE) to protect the rights of Indian workers.

These agreements envisage establishing a permanent government-to-government link through the formation of joint working groups. It is anticipated that such a mechanism would lead to the adoption of speedy policy decisions in tune with the changing demands of workers and the expectations of the host country. Besides, the Emigration Act, 1983, is being amended with new provisions to promote the welfare of Indian expatriate workers.

Analysts point out that it is well understood in New Delhi that Indias growing young population is a key resource that needs to be harnessed carefully. Apart from developing talent in the fields of science, law, financial services and entrepreneurship, it has been recognised that exporting trained manpower for the construction, transportation and hospitality sectors is also essential for growth. However, key legal provisions that will guarantee Indians working abroad decent salaries and humane treatment need prioritisation, experts point out.

In Bahrain, a minimum wage of BD 100 has been fixed for housemaids since October 2007. In order to ensure that the offer made to prospective housemaids is genuine, it is now mandatory to route the related paperwork through the embassy. The embassy also registers the mobile telephone number and the bank account number of the employee. This allows the employee and the embassy to stay in touch in case an emergency arises.

Regarding the enforcement of minimum wages, all contracts would now be screened in India before the worker is allowed to leave for Bahrain. Upon arrival, the embassy will re-scrutinise the contract. Diplomatic sources say that a second screening is necessary because it has become a common practice in the Gulf to force workers to sign new contracts upon arrival, on terms far adverse than the original ones.

According to a diplomatic source in the UAE, it is common for workers employed in Dubais giant Jebel Ali Free Zone to sign contracts without the direct intervention of the Ministry of Labour of the UAE or the attestation of documents by the Indian Consulate in Dubai. In most cases, these contracts are signed in Arabic. Unfamiliar with the language, workers frequently end up signing contracts without understanding their contents.

Rescued workers arrive in Hyderabad from Sharjah last November.-G. KRISHNASWAMY

Many workers later discover that they have become legally bound to an agreement, which they find difficult to fulfil. Once a contract is signed, seeking redress in a court of law becomes extremely difficult. Most workers, therefore, find themselves trapped in a hopeless situation as strikes are illegal in the UAE; trade unions cannot be formed and recourse to collective bargaining is not guaranteed.

A large section of the seven lakh construction workers in the UAE work in its free zones. Despite huge obstacles, workers in Dubai have staged major agitations. Nearly 40,000 workers of the Dubai-based construction giant Arabtec went on strike and brought life to a standstill in the companys 26 labour camps last year. Labour unrest also hit the Jebel Ali Free Zone and its surrounding areas. In October 2007, nearly 2,000 workers of the construction firm Pauling Middle East were up in arms demanding higher wages. Some of them turned violent, smashed police vehicles, and disrupted traffic.

Industry analysts in Bahrain say that despite the uproar resulting from the minimum wage call, employers in the construction sector are likely to adapt to the new regulation eventually. According to Paul Sunderrajan, a partner in a Bahrain-based construction company, workers are demanding higher wages because there is an acute shortage of manpower in Bahrain, where construction activity is progressing at a feverish pace. There is more demand and less supply, and that is the basic factor that is driving up wages and causing strikes, he said.

Sunderrajan also pointed out that there had been a large outflow of construction workers during the recent amnesty granted by the Bahrain government, which allowed illegal workers to depart the country without paying penalties. It is now becoming difficult to attract workers from India, which itself is experiencing a construction boom, at the prevailing level of wages in Bahrain, he observed.

Many involved in the Bahraini construction sector say that substituting Indian workers with workers from other manpower-exporting countries would not be easy. Observers say that blue-collar workers function as part of an integrated team that exists at the workplace. With senior staff at the work site in most Gulf countries acquainted with Indian languages, it would be hazardous to employ unskilled workers from other countries who do not understand these languages. Despite the opposition from employers, Bahraini trade unions and human rights groups supported the striking workers of GPZ, a majority of whom were Indian.

The General Federation of Bahrain Trade Unions information secretary, Jaffer Khalil, is quoted as saying that the right to strike is a basic right of any worker, whether Bahraini or expatriate. We are pained to note that some of these workers are living in inhuman conditions and are being paid as little as BD 40 every month, he observed. The head of the Migrant Workers Protection Society Action Committee, Marietta Dias, also urged employers to review the pay scales in the wake of the growing cost of living.

Responding to the labour unrest, Bahrains Shura Council has summoned Labour Minister Majid Al Alawi for a verbal hearing on the working conditions of expatriate workers. Official sources told Frontline that the Crown Prince of Bahrain, Sheikh Salman bin Hamad Al Khalifa, has been a strong advocate of labour reforms, in tune with modern international practices.

Not surprisingly, Bahrain has decided to do away with the much-maligned sponsorship system. Winds of change can also be felt in Saudi Arabia, which employs a huge South Asian workforce. A recent report in Saudi Arabias English daily Arab News quoted the Vice-President of the National Society of Human Rights, Mufleq Al-Qahtani, as saying: We dont see any real benefit from the present sponsorship system either for the workers or for their employers. We demand quick abolition of the sponsorship system and introduce a replacement, not only to protect the interests of Saudi employers and expatriate workers but also to protect national interests.

Recognising that the protection of workers rights is not only a moral obligation but, arguably, also a means to enhance productivity, an inter-ministerial forum of countries exporting human resources and their recipients has been established under the Abu Dhabi Dialogue framework. Steered by the International Organisation for Migration, the first meeting of the Abu Dhabi Dialogue, held in January, recommended developing a framework for a comprehensive approach to managing the entire cycle of temporary contractual mobility that fosters the mutual interests of countries of origin and destination.

While serious efforts are being made to protect its workers seeking employment abroad, the jury is still out on Indias capacity to enforce its own laws and regulations in pursuit of its goals. For instance, allegations about human trafficking involving unscrupulous recruiting agents and immigration authorities at Indian airports continue to appear at regular intervals.

Without proper documentation, workers who are victims of this nexus live in perpetual fear and are prone to abuse once they arrive in the host country. For many, the dream of working in an overseas paradise soon turns into an unending nightmare.

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