Nepal plans to reintegrate returning workers

Nepal’s post-2017 federal structure was supposed to decentralise governance of the country’s migration sector because local units have closer proximity to workers aspiring to go abroad, returnees and their families. 

On paper, local governments have an elaborate foreign employment related mandate including data collection of migrants, including those in India, information dissemination on safe migration procedures, skilling and returnee reintegration. 

However, it took the COVID-19 pandemic and the unprecedented reverse migration of the past few months to make local governments spring into action to manage returnee inflows, especially the unexpected influx from India. 

“The volume of returnees, especially from India, has significantly dropped and is more manageable now,” says Uma Thapa Magar, Deputy Mayor of Nepalganj. She says the chaos of the initial weeks has subsided but the longer term challenge of ensuring the reintegration of the returnees remains. 

Fortunately, the groundwork for multiple employment and entrepreneurship programs at local levels have been laid in the past few years. Coordinators under the Prime Minister’s Employment Program (PMEP) have been appointed in all 753 municipalities and placed in Employment Service Centers (ESCs). 

Admittedly, the PMEP has a checkered reputation because of allegations of wasteful spending, unproductive work and improper targeting of the unemployed. One employment coordinator told us: “The main issue is the lack of ownership by the local governments as it is still largely seen as a federal program. Employment is not usually a priority for local governments.”  

This year’s budget doubled the PMEP allocation to Rs11.60 billion to create 200,000 jobs to address economic challenges brought by the pandemic.

Richard Howard, Country Director for Nepal of the International Labour Organisation (ILO) says, “The issue is how to manage the Prime Minister’s Employment Program so it creates valuable assets needed for the municipality to grow. Public infrastructure needs proper monitoring and planning to ensure they produce something useful for the communities.” 

Nepalganj Deputy Mayor Magar says that even if the PMEP is done right, it will not be attractive to a majority of the returnee migrants. “It is largely a social protection program and the jobs offered are all low-wage and labour-intensive such as road work, cleaning, pulling weed or making canals. Returnees who have had higher paying jobs abroad will not find this attractive,” she explains. 

Much more useful for returnees would be entrepreneurship packages, Magar says. But local self-employment schemes  like Sahakarya only provide soft loans of Rs100,000 which is not enough to do anything meaningful. 

The Foreign Employment Board (FEB) in Kathmandu is said to be finalising a reintegration program for returnees funded by the Foreign Employment Welfare Fund to be implemented via local governments. 

Executive Director Rajan Shrestha says, “The program recognises that returnees are not a homogeneous group as has been evident during repatriation.” The plan includes a menu of services to increase job and entrepreneurship opportunities, like including skills training, business development training, psychosocial support, shelter support, financial literacy, grants, in-kind kits and referrals.

Returnees have been categorised into four groups from those coming back with skills and some savings, and could benefit with just a little push such with business development and loans, to those who need more hand holding including shelter and counseling before they look for jobs. 

The Foreign Employment Board has been criticised for not using its welfare fund to repatriate those stranded abroad, and a guideline prepared after the Supreme Court order has yet to receive Cabinet approval. 

“This is a contributory fund tied to welfare programs such as compensation to the families of migrants who die abroad or disability compensation to injured migrants. The budget is limited, and it needs to be supplemented with funds from other line Ministries, development partners or the private sector,” says the Board's Rajan Shrestha. 

Additional money is also necessary because those who did not contribute to the Fund are not eligible for its programs, like undocumented workers, or returnees from India who need support with re-integration.  

“The directive has opened the way for us to coordinate with partners to provide services to undocumented returnees ineligible for the Foreign Employment Welfare Fund, who may need the most support in reintegration. But we need to hit the ground running fast and test it on a pilot basis,” adds Shrestha.

The tricky part about reintegration is that they are just part of Nepal’s larger employment challenge. Returnees may expect higher wages, or may lack the contextual knowledge that those who have not left have. 

While there is a Rs1 million soft loan program already in place for returnees, at lest seven other low interest credits are available to those who return. The ILO’s Howard explains: “As soon as they come back, returnees may have special, immediate needs  which need to be addressed but after a while, they are just like everyone else who need livelihoods and employment support and the burden falls on the local governments.”

The Nepal Rastra Bank, for example, has made it mandatory for branches to provide at least 10 soft loans, and there Shrestha sees a coordination role for the Board to provide referral services and business development training through local governments, so returnees can get collateral-free loans for projects.

Lack of viable business plans was one of the reasons why out of 18,000 applicants, only 100 were approved last year. 

Hari Thapa spent over a decade in Saudi Arabia and the UAE and returned two years ago with some savings, but did not know where to invest it and how. His first venture failed, but he learned his lesson the hard way and his clothing business was doing well till the lockdown. 

He says: “Not only did I not receive any support, there were hassles to apply for the soft loan for returnees. There was always the option of re-migrating if nothing else worked.”

Now, Nepalis returning from overseas because of the pandemic crisis may get more attention than Thapa did if the new reintegration plans are implemented properly. 

About 150,000 Nepalis have returned from India since April, and some 25,000 Nepalis stranded in the Gulf, Malaysia and other countries have flown back on repatriation flights returned since 15 June. 

But this number pales in comparison to those who are stranded abroad, waiting for their turn to return, many still unable to afford their air fares home.