Migration and Remittance in 2030

Migration and remittances have become critical socio-economic forces in Nepal over the last ten years.  Remittance as percentage of GDP today has moved up significantly close to the total contribution by agricultural sector to the GDP—currently accounting for almost 30% of the national economy.

Recognizing this compelling contribution to the economy and addressing ongoing challenges related to labour and human rights violations, the Government of Nepal has initiated important laws, provisions, and mechanisms to promote and assist migrant workers. However, lacking necessary infrastructure and being understaffed, the government has not been able to execute and implement laws and mechanisms relating to the facilitation of migration for outbound workers and for their welfare. In coming years, Nepal will need to make a significant policy leap, including bilateral agreements with the job offering countries.  Foreign Employment Services will have to be expanded, improved, made easily accessible, and decentralized to ensure country-wide access thereby making the working system efficient, effective, and transparent for all migrant workers.

The majority of Nepali migrant workers are unskilled and uneducated, thus unable to understand the job contracts, rules, and their own rights which make them vulnerable to exploitation by manpower companies at home and employers in host countries. The focus should therefore be on prioritizing investments in human capital. Educated and skilled workers also command three to fourfold higher salary than unskilled workers. 

Prioritization of and investments on vocational schools and training centers with the goal of providing various technical skills to meet foreign job demands are imperative.  By investing in skilled and knowledge-based economy, Nepal will be able to create much-needed jobs at home as well. By 2030, the majority of migrant workers should be skilled/educated, which will make them less vulnerable to exploitation, and help them earn significantly higher incomes.  This will provide enormous social and economic benefits to the migrant workers, their families, and the overall economy.

Bibhakar Shakya, Ph.D.
Senior Distinguished Fellow, Nepal Economic Forum
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