As NRIs lose jobs in Gulf, recession worries in Kerala

gulflabourThe labour crisis in the Gulf is pushing Kerala towards recession, the state government, and Kerala Finance Minister Thomas Issac said’. This is the first time since the Gulf boom began that they may have negative growth of remittances this year.

A massive 35% of Kerala’s GDP is made up of remittances or money sent back to their families by people working in the Gulf, also thousands of Indian workers in Saudi Arabia have lost their jobs. Most of them are from Kerala.

Mr Isaac also said returnees will find it difficult to reintegrate into Kerala as remittances drying up, means jobs are dwindling in the state. He said he has incorporated some bold measures in the budget, to deal with the situation. By this he means he has announced an anti-recession and investment package of Rs.20,000 crore to boost the pace of investment in Kerala.

Of his so-called ‘fat tax’ that was introduced in July, he said it was not a resource mobilisation measure, rather it was an experiment to see if fiscal policy can be used to change dietary patterns, with a focus on public health.