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Curbing reverse remittance flow to India

bluesky

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07 Sep 2016, 23:57:29

Curbing reverse remittance flow to India
News Analysis
Shahiduzzaman Khan


Although the inward remittances flow increased by nearly 18 per cent in August from that of the previous month and stood at $1.18 billion, it is not considered satisfactory in comparison to that of the previous year.

According to an FE report this week, the inflow of remittances is showing a declining trend in various countries, including Bangladesh, mainly due to the ongoing economic recession in different parts of the world. Lower prices of fuel oils squeezed the development activities in the Middle-East countries. Bangladesh has been hit hard by the ongoing slump there.

On the other hand, there has been a large outflow of reverse remittances from Bangladesh to some neighbouring countries. Very recently, the Centre for Policy Dialogue, a local think tank, suggested that the government should form a committee to investigate the large remittance outflows to India.

Bangladesh is, according to reports, now the fifth largest remittance source for India, with around $3.7 billion sent in 2013. It is expected to rise further in the coming years. Unofficial figures say the remittances being sent by the Indian, Sri Lankan and Pakistani experts and technicians have already crossed the $4.0 billion-mark.

The total number of foreign workers in Bangladesh is estimated at 500,000. The number of foreign technicians in the garment sector now stands at more than 19,000 -- the majority of whom are Indians. This gives a disconcerting signal to the country's volatile job market. Most of them work in readymade garment (RMG), textile units and non-government organisations (NGOs), often without proper permissions and documentations.

Some time back, Finance Minister AMA Muhith expressed his concern over remittance outflow to the tune of $4.0 billion a year. The government is really 'worried', he was quoted as saying. Such a large amount of outward remittance tends to affect the country's current account balance.

With the economy growing and diversifying, the demand for employment in the high skill category has increased. The gaps in the country's human resource development efforts and the brain drain have induced employment of foreigners in the skill-intensive professions.

For employment of the expatriates, there are standard procedures for registration in the host country with work permits being issued to them for a stated period which can be extended periodically. Questions have, however, arisen whether such procedures are followed here or not. Taking advantage of the lax monitoring, many are reportedly working here without authorisation.

Many foreign experts, according to reports, are taking jobs in Bangladesh through some overseas companies, non-government organisations (NGOs) and other businesses. Such experts are gainfully employed in lucrative jobs here, earn hefty amounts of money and remit a large sum of their earnings here to their host countries.

The government does not, in fact, have a strict policy on foreign expatriates or a sound mechanism to control them. It is not otherwise possible to do it just because of the fact that the country's administrative capabilities are weak and the corruption is allegedly widespread.

There are allegations that a large number of foreigners employed in Bangladesh do not do any specialised job but ordinary administrative work for which there is no shortage of local candidates. Many foreign firms prefer to appoint an Indian or Sri Lankan as an administrative assistant or a junior level officer instead of local ones.

In fact, no job is offered to a foreigner when a candidate with proper qualifications that the job demands is available in most of the developed countries in the world. However, there are always exceptions for highly qualified jobs. In such cases, foreigners are preferred. Any foreigners can apply, and the best ones are given the jobs as per law of the land.

Bangladesh can otherwise streamline its job market by careful planning and introducing 'Residence Permit' for foreigners. For example, if an Indian company needs a junior officer, let it bring him from India with proper documents indicating that he is an Indian citizen and the company needs the person for a particular skill that he or she possesses. The company should not bring and hire someone from other countries, say Singapore or Pakistan, when such a skilled person is available in Bangladesh.

There is no denying the fact that a foreign company has a right to bring and employ people from the mother country, but employing a person from a third country must not be allowed. In this way, the country can obtain many attractive and well-paid jobs for its citizens.

Hiring foreign workers in Bangladesh in a disciplined manner is an utmost necessity for protecting the country's job market for the local people. The economy can hardly afford to offer jobs to foreigners when the local people are scrambling for the same day and night.

In this context, a thorough survey to prepare a reliable, updated data base on the state of foreigners in the country should be made. The concerned authorities should investigate how such large sums of foreign exchange are flowing out of the country.

The government does need to initiate necessary steps to curb reverse remittance flow, deal with the issue of hiring foreigners properly and develop skilled human resources for their substitution.

http://www.thefinancialexpress-bd.com/2016/09/07/45077/Curbing-reverse-remittance-flow
 

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