Minimum Referrral Wages for International Migrant Workers from India: An Assessment

In recent years, the Government of India has been fixing minimum referral wages to regulate the wages of Indian migrant workers -- employed in different occupations -- in countries falling under the category of “emigration check required” (ECR). The operation of a referral wage has ramifications for both migration flows and migration outcomes. To assess the functioning of the minimum referral wage system, this technical report studies selected occupation from India to three selected destination countries in the Gulf region - Kuwait, Saudi Arabia and United Arab Emirates. It concludes with policy recommendations which include supporting the Government’s idea of having a minimum referral wage system to ensure that standards of wages for Indian workers who are overseas are not undermined by other countries. The report recommends simple and more transparent ways of fixing the referral wages including having broad categories (low, semi and highly skilled) rather than specific occupations; to have a wage band within categories due to different skill levels of workers within the same category; and be based on India’s minimum wages. It also recommends establishing a committee of stakeholders to set these wages. It aims to find a balance between protecting workers and not hindering international migration which is in sync with the policy of the Government of India.