x Abu Dhabi, UAESunday 23 July 2017

Debt woes lead to mental problems

Suicide often the way out as soaring prices, stagnant wages and obligation to send money home burden the UAE's Asian communities.

An Indian expatriate with a financial crisis sits alone worrying about his problems.
An Indian expatriate with a financial crisis sits alone worrying about his problems.

DUBAI // Asian families suffering from steep increases in living costs and stagnant wages are increasingly seeking financial assistance from charitable organisations, with one reporting the number had more than doubled over the past year. Many such families have also plunged into debt because of pressure to send more money to families in their home countries. The trend has coincided with an increase in mental-health problems among Asian expatriates, experts say, and is of special concern to officials representing the subcontinental population.

Last week, the bodies of an Indian couple and their 20-month-old daughter were recovered from Dubai Creek. Police are investigating claims that Girish Kumar, 29, killed himself, his wife Shabija and daughter Gaurinanda because of financial problems. According to the Indian consulate in Dubai, 82 people from the city's Indian community who killed themselves this year had debt problems. Most of the suicides were by people from the states of Tamil Nadu and Kerala, the consulate said. The embassies of other subcontinental countries do not make such statistics available.

Such is the level of concern that the Indian consulate has set up a part-time counselling hot line (50 734 7676) to help people with depression or who are contemplating suicide. The Indian consul general, Venu Rajamony, said the Indian community, the UAE and the Indian governments should work together to educate families on what salaries and debt expatriates could expect here. Mr Rajamony said of the suicides: "It is most unfortunate that something like this has happened. And this is a problem that needs to be collectively addressed to prevent such things from happening."

Joseph Bobby, co-founder of the Valley of Love charity in Dubai, said the group sees two or three families a day looking for a way out of debt or for help for mental illnesses. In previous years, there would be two or three families a week, he said. He said many low-income families only wanted to pay off their debts so they could return home. "People also have long-term financial commitments back home, which they can't meet because of mounting bills here, so sometimes going home is not an option," Mr Bobby said.

School and bus fees, utility charges and food bills have all increased in the past year. But salaries have remained the same for many low- to middle-income families. The main sources of debt, according to Mr Bobby, are bank loans, credit cards and illegal lenders. While banks charge up to 10 per cent for loans, some credit cards demand as much as 30 per cent. Families turning to loan sharks could be forced to pay 78 per cent interest.

"At first we give guidance on how families could manage to stay here on a sound financial footing, but now we ask them 'can the family survive back home without the father?' if he was the main bread winner," Mr Bobby said. An Indian man and his wife who work as laboratory technicians at a government hospital in Dubai said they had been unable to repay the Dh130,000 (US$35,400) they had borrowed over the past six years.

The debts mounted as the couple took more loans to pay off the initial loans they had incurred, including being defrauded by a neighbour who promised to invest their money in a restaurant. The couple have also taken loans against more than a dozen credit cards from high street banks. The husband said: "The credit card companies are threatening without any humanity. They are threatening to take away our jobs and put us in jail because when our cheques bounce, it will be considered a criminal offence.

"We were a happy family, now it is very difficult. Now we are struggling to pay for school fees for the children or for groceries." The father of three, who earns Dh5,000 a month, and his wife, who earns Dh8,500, have not had salary increases in more than a decade. They are also being charged up to 180 per cent for every Dh1,000 borrowed from individual money lenders. The couple admitted they had contemplated suicide.

The also said part of their debt arose from financing a relative's wedding in India, for which they felt responsible. KV Shamsudheen, the Indian radio host who set up Pravasi Bandhu Welfare Trust to counsel expatriates burdened by debt and remittance, said he had been counselling another family whose debt exceeded Dh130,000. "The expatriates never inform the real situation to their families back home," Mr Shamsudheen said.

"When I conducted three awareness classes in Kerala in August for the dependants of expatriate Indians, I asked questions about whether they enquired about the conditions of the life of the bread winner in the Gulf. They replied that they never enquired about whether he has financial resources to look after the family. The families back home are very selfish. They want money only, and that plays a very important role in this situation."

A number of low-income newcomers arrive already in debt, from paying unscrupulous recruiting agents, he added. Adding to the burden is a recent ruling in Dubai prohibiting families from living in shared villas. It has meant that many families now live illegally, reside in unsafe conditions elsewhere, or are homeless. sbhattacharya@thenational.ae shafez@thenational.ae