Mainstreaming Migration and Remittances to the Development Agenda: Nepal Experience Jagannath Adhikari

Presentation Types, scale and importance of migration/remittances on national economy. Village level studies – on impact on society and economy. Policy evolution on migration and a case for mainstreaming migration and remittances. How development policies deal with migration/remittances. Policy gaps for mainstreaming migration in development policies. Jagannath Adhikari, June12,

Major migration currents in Nepal (most of them are occurring simultaneously.. But they are major flows) Early in-migration leading to peopling of the country (6 th - 13 th century). Traditional migration for trade (until 1950s), and combined with seasonal movement. Early heavy out-migration from Nepal 18 th -20 th century (with high taxation and extreme exploitation of common peasants). Migration for army jobs.. still continuing to some extent. Rapid internal migration (hill to Tarai) 1960 to 1980s, after malaria eradication. Foreign labour migration beyond India (after 1990). Jagannath Adhikari, June12,

Emigration (moving out of country: Sources – CBS, NIDS, 2012 ) SubtypesVolume (in 2011) Seasonal (Nepal to India)Mainly from mid and far west, Nepal; for farm work Nepali also go to India. Temporary (Nepal to India)0.8 million – 1.5 million Army Jobs (Nepal to India)50,000 (approx) Army Job (Nepal-British army)3,000 (approx) Temporary, Long distance, contract job (Beyond India, but mainly in Malaysia and Gulf) 1.9 million stock (about 360,000 yearly in recent times) women = 10% Student migration (except India)25,000 (approx..) in 2011 Refugees in NepalTibetan, Bhutanese, others… Jagannath Adhikari, June12,

Scale of foreign labour migration and remittance is staggering in Nepal Almost half of Nepali households have at least one current or a recent returnee migrant members working abroad. Remittance constitutes one-fourth of household income. At least 1/3 of working age male population is abroad Jagannath Adhikari, June12,

Volume of Migration is Large and Increasing Migration to foreign countries (except India) with official permission. (India – estimated at million; DoFE, GoN, 2012) Jagannath Adhikari, June12,

Gulf Sates and Malaysia are Main Countries for Migration from Nepal (other than India) (Data for ; DoFE, 2012) Jagannath Adhikari, June12,

8 There is a Direct Correlation Between Wealth Status and Where a Person Goes for Work (Source: NIDS, 2012) Wealth StatusWhere they go for workType of work PoorIndia (on a seasonal basis or temporary) laborers, hotel and restaurants, domestic help Lower middle classIndiafactory work and office work Malaysia and Gulf Statesunskilled works Upper middle classIndia (few)army or civil service Malaysia and Gulf States (many) unskilled and semi- skilled works Higher classJapan, Korea, North America, Europe, Australia Entry level wage work, professional work

Official Remittances to Nepal US $ 5.2 billion in 2011/12 (Source: MoF, Economic Survey, 2012, NRB, Economic Bulletin, 2013) Jagannath Adhikari, June12,

Remittance Contribution to Nepal’s Economy (source: MoF, 2012) Jagannath Adhikari, June12,

Jagannath Adhikari, June12, Huge Contribution of remittance (internal+external) to poverty reduction Description % households receiving remittances Average amount of remittances per recipient household (nominal Rs) 15,16034,69880,425 Share of remittances (%): From Nepal From India From other countries Poverty rate (% people below poverty) Source: CBS, 2006, 2012 (NLSS I, II and II)

Total Remittances by Districts in 2009 (poor regions participation is very low) Source: (world Bank 2009) Jagannath Adhikari, June12,

Village study (Pokhara and its nearby villages) Jagannath Adhikari, June12,

Jagannath Adhikari, June12, % households having members in foreign countries to work (except India) from Lachok-Rivan village Ethnic groups Brahmin- (India seasonal - 15 %) Chettri- (India mostly seasonal 25 %) Dalit- (India mostly seasonal - 50 %) Gurung8 (UK army) 25 % India army)

Use of remittances Consumption - macro-economic situation … balancing the national current account.. (dominant discourse in Nepal) NLSS III says only about 2% is used for capital formation. Other studies contradictions. Grass-roots studies show that use in education, health and buying assets are important.. (after paying loans). there are multiplier effects for employment and income generation (land rent opportunities… wage opportunities). High investment on buying land, especially in urban areas and market centers. Remittances leading to internal migration… for housing, children education and medical facility, and for businesses like shops… -Village to road side… ; Village to market centers; Village to urban areas… Jagannath Adhikari, June12,

Houses (old and new) Jagannath Adhikari, June12,

Jagannath Adhikari, June12,

Returning to Village Jagannath Adhikari, June12,

Jagannath Adhikari, June12,

Advertisement of remittance agencies in rural areas Jagannath Adhikari, June12,

Remittance Agency’s Advertisement – (bringing happiness to parents). Jagannath Adhikari, June12,

Remittance Agency’s Advertisement – (bringing happiness to migrants’ wives) Jagannath Adhikari, June12,

Left Behind Families and Their Problems Jagannath Adhikari, June12,

Impact of Migration on Natural Capital in Villages Increase : -Fallow land -Tree cover - Wage rate of males Decline : -Livestock number -Food production -Land rents - Intake of nutritious food Jagannath Adhikari, June12,

More Forest Cover Now Jagannath Adhikari, June12,

Male Laborers are Scarce Wages for male have Become High Jagannath Adhikari, June12,

High Burden on Women Jagannath Adhikari, June12,

More Workload and Responsibility on Women Feminization of farm work Feminization of social and collective works Shift in gender-roles More participation in market More Family problems Girls sharing mothers’ workload Jagannath Adhikari, June12,

Migration and Rapidly Changing Communities Individualization of community works. Pressure to generate more income. Diverging interests and more conflicts. Changing caste relations. Male labour shortage. Male youth not interested in education. Jagannath Adhikari, June12,

Extended Community? Multi-locational livelihood strategies. Village community reproduced in other spaces through diasporas (Japan, Gulf States, New York City). Migrants bringing in skills. Resource generation and skill transfer for schools, hospitals and other village development. Jagannath Adhikari, June12,

Regulations and policies Present migration related Acts/policies/regulations/procedureOther supportive policies Foreign Employment Act 2007The Interim Constitution 2007 Foreign Employment Rules 2008Passports Act 1967 Foreign Employment Policy 2012Nepal Citizenship Act 2006 Internal Working Directive of Department of Foreign Employment 2009 (2066 AD). Non-Resident Nepali Act 2008 Directives for Emigration for Women Domestic Help, 2012Nepal Rastra Bank Remittance Rules 2010 Report of a Task-Force constituted to make recommendation to improve foreign labour migration 2010 National Micro-finance Policy 2064 EPS system Nepal Rastra Bank Provision Related to Providing Credit to Poor (Bipanna Barga) Executive Order 17 JITCO Directive 2009 Working Procedure to send Caregiver to Israel, 2011 Bilateral agreements and MoUs Three Year Plan ( ) Immigration Act 1992 and Labor Act 1992 (guide immigration) Jagannath Adhikari, June12,

Policy evolution/mainstreaming Before only domestic employment generation was emphasized. 7 th Plan ( ) and 8 th Plan ( ): realization of importance of foreign employment. The ninth Plan ( ) – emphasized the need to take advantage of globalization process through foreign labour migration promotion of skill development and economic diplomacy. - Policy to send 200 workers for foreign employment from each electoral constituency, numbering 201 constituencies at that time, - To provide loan of Rs 100,000 to conflict affected and socially excluded groups so that they could take the opportunity for foreign employment. Both these policies did not continue. Jagannath Adhikari, June12,

Political change 2006: Foreign Employment Act (2007) and Foreign Employment Rules (2008) Current Interim Plan ( ) separate chapter on foreign employment Foreign Employment Policy 2012: To mobilize remittances for human development and in the manufacturing sector. Mainstreaming of foreign employment in local level projects through collaboration with local agencies, which will also be responsible for awareness raising on foreign employment. Jagannath Adhikari, June12,

Policies to use social remittances Foreign Employment Policy 2012 and Interim Plan ( ) give concern for use of social remittances. “looking at migration as a means of brining in new skills and technology. Using the skills and experiences of returned migrants for the development of enterprises to develop country and reduce poverty”. Lacks concrete programs. Jagannath Adhikari, June12,

Migration policies and other policies: Not much inter-linkage in related policies in migration and development/environment, which refers to migration but do not mainstream it. Interest in policies to use remittances as a means of poverty reduction (PRSPs -10 th plan and in other periodic plans). Conversely, poverty reduction and women development policies do not deal with migration and remittances. The Three Year Plan ( ) has clearly stated that it will encourage bank and financial institutions to provide soft loans to the needy people but not in action. Nepal Rastra Bank’s micro-credit policy on ‘poor’ has provision for loan for migration. Reservation for 10% seats (social inclusion of women, Dalits and marginalized groups) in Foreign Employment Rules. Jagannath Adhikari, June12,

Policy Gaps: Mainstreaming Migration to development There is a clear case for mainstreaming migration for development and for improving livelihoods. There has been gradual evolution in migration policies – which aim basically at migration safety, welfare and using remittances for productive use. There is recognition/discussion in different policies eg poverty reduction, agricultural development, climate change adaptation, social development (eg women development, children development, social welfare) micro- finance on migration taking places and remittances coming in and their consequences on society and economy. But, they are short of mainstreaming migration in their policies and programs. Jagannath Adhikari, June12,

Policy gaps…. Policy on information system, particularly information sharing through digital means among different related agencies, is lacking leading to duplications and hassles for workers. Vertical thinking/action in sectoral ministries. Decentralization policies do not deal with foreign employment and remittances at local level. Policy to use remittances for encouraging productive investment is lacking. Simple things like having a migration resource center in CDO office while getting passport and having a facility to watch at video about migration could be beneficial. Jagannath Adhikari, June12,

Thank You Jagannath Adhikari, June12,