Explained: As Modi visits UAE, a look at the Indian diaspora, remittances, Emirati job market & other details

According to the Indian Embassy in the UAE, an estimated 3.5 million Indians resided in the country as of 2021 (Reuters file image)

Prime Minister Narendra Modi's visit to the United Arab Emirates (UAE), his seventh since 2015, highlights the blossoming Indian-Emirati ties. A key cornerstone of the relationship has been the Indian diaspora, which is a significant contributor to the UAE's economy.

The Indians settled in the Emirates are also major contributors to foreign remittances received by New Delhi, besides increasing the country's soft power.

PM Modi to begin 2-day UAE visit today: Check key details and full schedule here

According to the Indian Embassy in the UAE, an estimated 3.5 million Indians resided in the country as of 2021. Here's a look at what drives their stay in the Middle Eastern economy, the remittances they send, the Emirati job market and other details.

Record-high remittances inflow

India clocked the highest amount of remittances inflow in the calendar year 2023, at $125 billion, as per the data shared by the World Bank. The UAE, with an estimated 3.5 million-strong Indian diaspora, has been one of the biggest sources of remittance flow.

"Remittance flows to India were also boosted by higher flows from the GCC, especially the UAE, which accounts for 18 percent of India's total remittances and is the second-largest source of them after the US," the World Bank said in a report released in December.

The two countries also inked a bilateral trade agreement last year, that allows for the settlement of transactions in rupee and dirham.

Growing share in white-collar workforce

The profile of the Indian diaspora has changed with the evolving needs of the UAE. In the 1970s and 1980s, when the principal requirement was for blue-collar workers, "the Indian community was blue-collar to the extent of 85-90 per cent, with a negligible percentage of professionals", the Indian Embassy said in a note on its website in 2022.

In the 1990s, as the need for professionals to meet the needs of the expanding service sector emerged, the profile of the community changed, and today, "around 35 per cent of the Indian community is made up of professionally qualified personnel, businessmen and other white collar non-professionals and their families", it added.

The approximate break-up of Indian immigrants in UAE is as follows:

•  65 percent belong to the blue-collar category (employed mostly in construction companies, municipalities and agricultural farms)
• 20 percent are white-collar non-professionals (clerical staff, shop assistants, salesmen, accountants, etc.) and 15 percent are professionals and businessmen.

Among the Indian states, Kerala is the most represented among the diaspora, followed by Tamil Nadu and Andhra Pradesh. However, Indians from the Northern States, all put together, also form a significant portion of the Indian population in the UAE, the embassy said.

Though most of the Indians living here are employed, about 10 percent of the Indian population constitutes dependent family members, it added.

UAE job market

The job market in the Middle East, including the UAE which is the largest employer of foreign workers, has become significantly more competitive in 2024, according to 73 percent of working professionals surveyed recently by jobs portal Bayt.com.

A shift is seen in the employers' market in the UAE, as more people are moving to the country due to economic headwinds in other nations, and the luxury lifestyle that the Emirates offers, recruitment consultancy Robert Half stated in its 2024 Salary Guide report, as per The National newspaper.

“A larger proportion of UAE-based organisations grew their headcount in 2023 than in 2022, and more than half of this year’s respondents intend to increase remuneration in 2024,” the Emirati daily quoted Trefor Murphy, founder and chief executive of Cooper Fitch, as stating in the UAE Salary Guide 2024 report.

As per the report, the salaries of professionals in the UAE are expected to rise by an average of 4 percent to 7 percent in 2024.