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22 February 2024

Indian Migrants Reshape Armenia's Labor Market

It's an ironic development for a country with high levels of out-migration.

Indian Migrants Reshape Armenia's Labor Market

Image: Dr David Sing/Shutterstock

(Eurasianet) Armenia's capital Yerevan has seen surging numbers of labor migrants from India over the past year and a half. 

This as the city's demography and economy have already been reshaped by the influx of Russians fleeing the consequences of Moscow's invasion of Ukraine.

It's a novel and ironic situation for a traditionally ethnically homogenous country whose economy relies to a large extent on its own citizens going abroad as labor migrants. 

Armenia began to attract labor migrants from India in 2018, when its economy began demonstrating dynamic growth and local businesses began to have trouble finding workers. The economy needed cheap labor. 

Thousands of Indians in Armenia's Economy

The number of Indians in Armenia, whose population is just under three million, has grown steadily since then. In 2018 there were a few thousand Indian citizens residing in the country but now that figure is between 20,000 and 30,000, then-Economy Minister Vahan Kerobyan reported last November. 

The figures of the State Statistics Committee (Armstat) differ slightly. Armstat says that in 2023 a total of 54,582 Indian citizens entered the country, of whom 34,687 are considered "tourists." That's considerable growth over the numbers for 2022, when 21,591 Indians entered Armenia, 18,194 of them "tourists." 

But the tourist designation has little meaning and it's hard to distinguish between tourists and labor migrants, largely because many of the latter group never register to seek residency or the formal right to work. In fact, the number of Indian citizens granted residency between 2018 and 2023 has not changed sharply, ranging between one and two thousand annually.

Economists say all this makes it clear that most Indians in Armenia are engaged in the shadow economy.

The former economy minister effectively acknowledged this reality in his remarks last November, noting that tourist flows from India are actually not that high.

Two Factors Attracting Indian Migrants to Armenia

Indians, like other labor migrants, migrate with one goal in mind - to find work and send money back home to their families. Armenia's rapid economic growth in the past few years has made it an attractive destination. 

Over the past few years, Armenia's GDP per capita has nearly doubled in dollar terms. According to the International Monetary Fund, that indicator rose from just over $4,200 in 2018 to over $8,200 in 2023. It's now the highest GDP per capita among the South Caucasus countries. India's GDP per capita, meanwhile, is around $2,800. 

Armenian economist Armen Ktoyan believes that the influx of Indian migrants to Armenia has two main causes: higher wages than back home and the strengthening of the national currency, the dram, in relation to the dollar over the past year and a half. 

"It's precisely these factors that have triggered the influx of labor migrants from India, and this is important in terms of stimulating economic growth. Businesses in spheres such as construction, agriculture and services hire them and save money by doing so. And this in turn lowers the cost price of their products," Ktoyan told Eurasianet. 

Many labor migrants from India are willing to do low-skilled jobs in Armenia due in part to their lack of knowledge of the state language. 

"The delivery sphere suits best. You don't need to know Armenian to work as a courier. You have the delivery address, you make the delivery, and that's it," 27-year-old Suraj, from India, told Eurasianet. 

Suraj has been working as a courier in Armenia for several months. Like hundreds of other Indian citizens, he came to Armenia to make money. He lives together with friends in a rented apartment on the outskirts of Yerevan. So far, he's content with his work. He makes enough to live in Armenia and send $150-200 home each month. 

"I've got everything strictly budgeted. I spend about $120 a month on food in Yerevan, I pay a little less than that in rent, I pay about $200 per month to rent the motorcycle I use for the deliveries. And the rest I send home to my family," Suraj said, adding that this sum is enough to cover living expenses for his five-member family in India for a month. 

Some Indians have stayed longer, gained some grasp of the language and are able to find more profitable work, such as driving a taxi. 

Thirty-four-year-old Ajit has lived in Armenia for two years. He says he came to work in construction. He worked in this field for a few months, building high-rise apartment buildings, then he and some friends did farm work, then he decided to drive a taxi. 

"I was learning Armenian in parallel. I learned the rules of the road and ultimately I was able to work as a taxi driver," said Ajit, who came to Armenia in the footsteps of his cousin, who had come and was able to send money home. 

Indians Change the Labor Market

The sudden appearance of large numbers of Indian workers has changed the Armenian labor market, eliciting mixed reactions from locals. Some worry that Indians are taking their jobs because they're willing to work for less. Others, particularly members of the business community, are distinctly positive. 

"I wouldn't say that the Indians are taking jobs away from locals. As a rule, they work in fields where there is not enough labor. I hire Indians not because I want to pay them less. Sometimes I pay them more than locals since they're good workers. They don't ask many questions, they work, they don't laze about," a local businessman producing canned goods and non-alcoholic drinks told Eurasianet. 

The businessman, who requested anonymity, added that the Indian migrants are creating "healthy competition" on the market. "It's becoming clear to local workers that businesses have an alternative, and this spurs them to be more productive," he said. 

The influx of migrants to Armenia is taking place against a backdrop of strengthening relations between Yerevan and New Delhi. 

According to Indian media reports - which have not been refuted by Armenian officials - in the past year and a half Armenia has signed contracts with India on the purchase of hundreds of millions of dollars of weapons, becoming, according to Armenian officials, the biggest buyer of Indian military hardware in the world.

These growing strategic ties have given India the image of a friendly country in the eyes of Armenian society. For the most part, this positive feeling is extended to the Indian migrants themselves, though there have been occasional manifestations of xenophobic aggression. 

"Indians as labor migrants is a new phenomenon for Armenia. Twenty or thirty thousand people is a large number for our country, so it's been hard for some people in Armenia to comprehend what's going on. People are adapting to each other and in this process there might be some misunderstanding, incomprehension. But I don't see any discrimination against Indians in Armenia, let alone discrimination on a large scale," social anthropologist Aghasi Tadevosyan told Eurasianet. 

Many Indians in Armenia have no plans to stay over the long term. For some, it's a jumping-off point, a place where they can get an economic footing, get residency, get a Schengen visa and move on to Europe.