In a recent decision, Nepal and Malaysia have signed a Memorandum of Understanding (MoU) on supply of labor.

The new deal will open ways for supply of Nepali labor to Malaysia, which has been on hold since six months period.

Prior to the signing ceremony, the Nepali Cabinet has approved this long-awaited proposal in a meeting on October 29, 2018.

Nepal and Malaysia agreed on this pact during Nepali delegation’s Malaysia visit in the last week of September 2018.

This deal gains significance in view of the fact that Malaysia is one of the biggest destinations for Nepali migrant workers, currently employing around 500,000 Nepalis.

A Result of Series of Discussions

The latest labor agreement underwent a rounds of discussions over the last six months and its draft was finalized last month after a three-round review in the six months period.

“Our main aim is to protect rights of our workers and ensure their safety in the host nation. This deal is going to be a milestone in that respect,” said Narayan Regmi, Secretary at the Minister for Labor, Employment and Social Security.

This first-ever labor agreement between the two countries will open avenues for the migration of Nepali workers to the latter country.

While Malaysia has been the key host for Nepali migrant workers since more than a decade, Nepal currently stands out to be the second largest contributor to Malaysian economy in terms of workforce.

The new labor pact is being termed as a landmark deal in the history of Nepal’s foreign employment sector, given the fact that Nepali workers will no longer need to pay any recruitment fees for Malaysian jobs.

Under the agreement, Malaysian employers will take bear all the expenses pertaining to hiring of workers, along with expenses for their return journey.

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Nepali Minister for Labor, Employment and Social Security Gokarna Bista informed this in an address to lawmakers at the Industry, Commerce and Consumer Welfare Protection Committee meeting under the Legislature-Parliament, held in Kathmandu on August 15, 2018.

“We are holding formal and informal discussions to sign labor agreement with Malaysia. There is strong possibility of resolving the issue of Malaysia soon,” reads Bista’s statement.

Lauding the Malaysian Government’s decision, Bista expressed hope that the long-standing issue concerning Nepali migrants in Malaysia will come to an end.

“Malaysian Prime Minister Mahathir Mohamad has given positive message in the side of Nepal in the Parliament meeting of Malaysia. The government of Nepal wants to thank Prime Minister Mahathir Mohamad and Labor Minister for the same,” said Bista.

In response, lawmakers also lauded Nepali Labor Ministry and the minister Bista’s role in dealing with the issue internally and externally.

In his address, Lawmaker Lal Prasad Sanwa Limbu and former President of Nepal Association of Foreign Employment Agencies said the government needs to take a tough stance to improve Nepal’s foreign employment sector.

“Tough steps should be taken to improve the foreign employment sector. Now, the government should take a decision to manage the service charge. The collateral of manpower and service charge is connected to each other,” says Limbu.

Meanwhile, Lawmaker Devendra Paudel pitched on the need for formulating a long-term plan to bring back Nepali migrant workers.

Many other lawmakers in the meeting urged the government to form an effective action plan to address gaps concerning the Nepali labor sector.

Senior person of the committee Mukunda Neupane, Pradeep Yadav, Jaya Gharti Magar Sarita Kumari Yadav, Sujata Pariyar and Durga Kumari BK were among key lawmakers present at the meeting.

Also Read

• Nepal Govt. Gives ‘Nod’ to Malaysian Job Aspirants
• Malaysia Busts Migrant Worker Scam, Relieves Nepal and Bangladesh

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In its latest Macroeconomic Report, NRB said the country’s remittance earnings saw a 7.3 percent rise to Rs 679.73 billion in the first eleven months of the fiscal year.

The rise in remittances was observed despite a decline in number of Nepali migrant workers moving abroad for jobs and is majorly attributed to the rise of Dollar against Nepali Rupee.

According to Migration Expert Arjun Kharel, more Nepalis abroad sending their incomes to home through banking or formal channels has also contributed to the rise in remittances.

“Remittance inflows have grown even though the number of Nepali workers seeking approval for foreign employment has been on a declining trend,” says Arjun.

A Glance at Numbers
According to the report, Nepal Government approved 342,426 individuals for foreign employment during the mid-August to mid-June period of FY 2017-18.

Malaysia topped the list as the major source of destination for Nepali migrants, followed by Qatar UAE and Saudi Arabia, among others, for the first eleven months of the 2017-18 fiscal.

According to the report, Malaysia witnessed more than 104,149 Nepali migrant workers in the said period, showing a 15.37 percent year-on-year rise.

Qatar stood second hosting around 97,536 Nepali individuals, showing an 18.57 percent year-on-year drop. Next in the list, Saudi Arabia also saw a 46.60 percent decline with only 38,680 Nepali individuals.

Whereas, UAE saw a rise of 5.46 percent year-on-year rise by welcoming 55,631 Nepali workforce.

Foreign market analysts feel that oil prices, low migrant wages and delay in payments could be among key factors that slowed down the movement of Nepali migrants to Saudi Arabia for jobs.

While Nepal Government has seen a drop in migrant departures for the two consecutive years, Arjun says that the impact of the fall in worker departures on remittance inflows will not be visible immediately and most likely to reflect in the coming year.

Rise in Wages
In another interesting update, South Korea has announced increase of wages to Nepali migrants working in the country.

In its latest decision on July 13, 2018, the South Korean Government fixed the minimum wage of a Nepali migrant at 8,350 won, which is approximately Rs 809 per hour, marking a 10.9 percent growth on the current pay.

According to local media, the Minimum Wage Council decided this after a 19-hour-long discussion and is being considered as a first such decision in the country’s history to increase the minimum wage to the 8,000-won mark.

Now, Nepali workers in South Korea are more likely to get a Rs 20,000/per month hike with the rise in basic salary starting from 2019.

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