The recent phenomenon of emigration from Kerala to the Gulf countries and the increasing inflow of remittances is having a tremendous impact on Kerala's economy. The state planning board reports that the remittances from the Gulf to this tiny state are Rs. 400 crones/year. An annual inflow of this amount cannot help influence the fortunes of the population. Although emigration from Kerala is not new, the current outflow reached massive proportions only in the wake of the intensive construction boom in the West Asian countries, after a huge volume of petro dollars flowed into those countries in the aftermath of the 1973 hike in oil price. In December 1977 a total of 135,000 Keralities were employed in foreign countries, mainly in West Asia. These adventurous migrants, in their quest for a wage, emigrated mainly from 4 areas in the state: Varkala in Trivandrum district; Thiruvalla in Alleppey district; Chavakkad in Trichur district; and almost all parts of Malappuram district. The bulk of the remittances are sent to households and next of kin concentrated in these areas. This unprecedented inflow of remittances has kindled the hopes of politicians and administrators of tapping these resources to solve the problems of economic development of the state. 1 category of emigrants come from poor households, are poorly educated, and are masons, carpenters, or even unskilled laborers. Because of their ignorance and gullibility they are exploited by middlemen who charge them Rs. 12,000 for a no objection certificate (NOC). Moneylenders are also doing a thriving business. Another type of emigrant is from relatively well off households, better educated, and able to obtain better jobs. There are also rich businessmen and contractors among them. It is this category of better educated emigrant who is able to save a substantial part of his income. State administrative circles note that remittances at best can provide only the financial capital. According to T.C. Razajm a businessman in Abu Dhabi since 1965, emigrants will invest in an industry only if they are convinced of the viability of the project, have a say in its management, and if there is reservation of jobs in the enterprise for their competent dependants. Thus far, the money mobilized into industry seems to be only a tiny proportion of the remittances. A major avenue of investment for the emigrants is real estate and, consequently, the prices of land have registered a marked increase. Even the service sector -- taxis and travel agencies -- have received a sizable boost because of the inflow of Gulf money into the state. According to G. Narayana Pillai, culturally and socially the new found wealth will not bring about any substantial social improvement.
