The escalating conflict in West Asia has brought the safety and livelihood of Nepali migrant workers in Iraq into sharp focus. With an estimated 30,000 Nepalis currently employed in Iraq, the ongoing war between US-led forces and Iran-backed militias has created a humanitarian and economic crisis that extends far beyond the battlefields -1-4.
As the conflict intensifies, Nepali workers—many of whom work
as security guards, airport staff, and base camp workers—find themselves
trapped in a nightmare of drone attacks, workplace closures, and an uncertain
future. For a country where remittances account for approximately 25% of
GDP, the stakes could not be higher -6.
The Human Toll: When Bombs Fall on Nepali Workers
The reality of this conflict hit home in March 2026
when two Nepali security guards were injured in a drone attack
targeting the UAE Consulate General in Erbil, the capital of Iraq's autonomous
Kurdistan Region -4.
One of the injured guards described the harrowing
moment: "We were eating. Suddenly the drone exploded. My hand and
face were engulfed in flames" -4. His colleague suffered minor injuries to his hand.
Thirteen Nepali security guards and two Nepali female employees were working at
the Consulate at the time. This was the second attack targeting the embassy in
just one week -4.
The attack on the UAE Consulate was not an isolated
incident. Just weeks earlier, 120 Nepalis working at Erbil International
Airport—which houses a US military base camp—were forced to flee for their
lives when drones appeared in the sky -4.
Indra Gurung from Gorkha, who worked at the airport for five
years, recalled the terror: "We were inside the airport. Some flights
were being canceled. Suddenly, drones started flying in the sky. There was no
information that the airport would be attacked. When the attack started, a
stampede began inside the terminal" -4.
The 120 Nepali workers were among more than 400 workers
evacuated from the airport. They were allowed to take nothing but the clothes
on their backs.
Who Are the Nepali Workers in Iraq?
Nepali workers in Iraq are primarily employed in security
services, airport operations, base camp logistics, and hospitality. According
to the Ministry of Foreign Affairs (MoFA), approximately 30,000 Nepalis
are working across Iraq, with a significant concentration in Erbil, the capital
of the Kurdistan Region -1-4.
The Kurdistan Region has historically been considered safer
than other parts of Iraq, attracting international companies and diplomatic
missions. Nepali workers have found employment guarding diplomatic compounds,
working at international airports, serving in military base camps, and working
in restaurants and hotels serving foreign personnel.
However, the relative safety of Kurdistan has been shattered
by the recent escalation. Multiple drone attacks targeting Erbil airport—which
houses a US military base camp—have forced Nepali workers to confront the
brutal reality that no place is truly safe -4.
More than 150 Nepalis working inside the American base
camp at Erbil airport have already returned to Nepal -4. Ram Bahadur Thapa of Arghakhanchi, who worked at a
restaurant inside the American base camp, explained his decision to leave after
seven years: "The first week was very tense. It is not just Iran that
is being attacked here. Iran-backed groups in Iraq are attacking. I will
probably return only if the situation becomes favorable" -4.
Government Response: Suspension and Rescue Efforts
Recognizing the grave danger, the Nepali government acted
swiftly. On March 1, 2026, the Department of Foreign Employment suspended
labour permits for 12 West Asian countries, including Iraq -1-8. The suspension—covering both individual and
institutional permits—was announced as "indefinite" until further
notice.
The decision was made at the ministerial level by the
Ministry of Labour, Employment and Social Security (MoLESS) in response to the
deteriorating security situation -3-10.
However, the suspension has created a secondary crisis.
Approximately 2,000 Nepalis per day who would typically depart for foreign
employment are now unable to leave -3.
Many had already taken high-interest loans to pay recruitment fees, hoping to earn
a better life abroad. Now, those dreams are on hold, but the debts remain.
The government has also launched online registration
systems to track Nepali citizens and coordinate rescue efforts -1-7. Diplomatic missions in the region—including the Nepali
Embassy in Kuwait, which handles Iraq affairs—have been issuing travel
advisories and safety notices -5-7.
Yet, the government faces enormous challenges. Spokesperson
Pitambar Ghimire of MoLESS admitted that "the government doesn't have any
plan yet to conduct rescue works and bring Nepalis back home" -1. Instead, the government is focused on "collecting
details of Nepalis and applications for any support through a dedicated online
system" -1.
Economic Impact: Remittances Under Threat
Beyond the immediate human toll, the conflict threatens
Nepal's economic lifeline: remittances. According to Nepal Rastra Bank
(NRB), remittances grew by 39.8% to Rs 1,261.01 billion in the first
seven months of fiscal year 2081/82 (mid-July 2025 to mid-February 2026) -3.
A staggering 41% of Nepal's total remittance inflows originate
from 15 countries in the Middle East, with Iraq being a significant
contributor -6. Remittances currently account for approximately 25%
to 27% of Nepal's GDP, making the country one of the most remittance-dependent
nations in the world -6.
The conflict has already disrupted this flow. Flight
cancellations have stranded thousands of passengers—approximately 17,000
people affected by 104 cancelled flights—and the suspension of new labour
permits means no fresh remittances will flow from new workers -6.
Economists warn of a perfect storm. If the conflict prolongs
and Nepali workers are forced to evacuate, the consequences would be
catastrophic:
Declining household incomes for millions of Nepali
families dependent on remittances from Iraq and other Gulf countries
Strain on foreign exchange reserves, which currently cover
18.1 months of imports but would rapidly deplete without fresh remittance
inflows
Slowing economic growth as consumption, construction,
and service sectors contract -6-9
Gunakar Bhatta, former executive director of Nepal Rastra
Bank, explained the cascading effects: "Many studies have shown that
if the price of oil per barrel increases by 10 percent, inflation rises by 0.4
percentage points, while economic growth declines by 0.15 percentage
points" -9.
The Workers' Dilemma: Stay or Leave?
Faced with mounting danger, Nepali workers in Iraq are
making impossible choices. Some, like the 150 workers from the American base
camp, have already returned to Nepal. Others are determined to stay—driven by
the harsh reality that Nepal offers few employment alternatives.
Tal Bahadur Ale Magar of Udayapur explained his
decision: "I do not want to leave my job here and return to Nepal. I
want to work for another year and a half. I will return home only if the
situation becomes critical" -4.
Mukesh Gurung of Pyuthan, evacuated from Erbil airport to a
hotel, remains hopeful but cautious: "The company has said they will
send us on duty only when the situation normalizes. They have said they will
send us to Nepal only when there is a need to go" -4.
The workers staying in hotels face an uncertain daily
routine. With work suspended, Mukesh described their current existence: "We
are all in the hotel. Since work is closed, our current daily routine is just
to survive" -4.
For those who remain, the psychological toll is enormous.
Shishir Gurung of Gorkha, speaking from Iraq, captured this anxiety: "What
will happen to us? People from home are always concerned about the security
guarantee. We are safe now. I am also reassuring my family" -4.
Broader Economic Ripples: Beyond Remittances
The impact of the US-Iraq war extends beyond the 30,000
Nepalis directly employed in Iraq. The broader West Asian conflict has created
multiple economic shocks that reverberate through Nepal's economy:
Fuel Prices and Inflation
With global oil prices spiking due to supply disruptions,
Nepal faces skyrocketing fuel costs. Diesel, petrol, and LPG prices have
already increased. Transport operators have raised fares, construction has
slowed due to diesel shortages, and households reliant on LPG for cooking face
rising costs -2.
Tourism Collapse
Disruption of international flights has significantly
reduced tourist arrivals in Nepal -2. This is devastating for a country where tourism is a
major employment sector and source of foreign currency.
Fertilizer Shortages
Nepal imports significant quantities of chemical fertilizer
from the Middle East. Supply disruptions threaten agricultural production,
compounding potential losses from forecast below-normal monsoon rains -2.
Policy Failures and the Need for Reform
The current crisis has exposed deep structural weaknesses in
Nepal's foreign employment system. Labour experts note that approximately 65-70%
of Nepali migrant workers are concentrated in the Gulf and West Asia—a risky
over-reliance on a single volatile region -3.
Rajendra Bhandari, former president of the Nepal Association
of Foreign Employment Agencies (NAFEA), captured the industry's
paralysis: "With the conflict continuing, the outflow of workers has
almost stopped. Even if jobs are available, workers cannot be sent until the
situation stabilizes. If the conflict escalates, a rescue operation may be
needed" -3.
The economic concentration is equally troubling.
Around 40% of total remittances are estimated to originate from the
Gulf region, particularly Saudi Arabia, Qatar, the UAE, and Kuwait -3.
This over-dependence leaves Nepal's economy dangerously exposed to geopolitical
shocks.
Labour expert Rameshwar Nepal noted that researchers are
currently studying the full impact, but the warning signs are clear: Nepal must
diversify its labour export destinations. Europe offers promise, with wages
nearly double those in the Gulf -3.
However, the transition will require significant policy reform and bilateral
agreements.
What Comes Next?
As the US-Iraq war shows no signs of abating, the situation
for Nepali workers remains precarious. The government has formed an Emergency
Response Team (ERT) and Emergency Control Room (ECR), but concrete
rescue plans remain elusive -5.
Prime Minister Sushila Karki has held telephone
conversations with UAE and Qatari leaders, expressing gratitude for their
protection of Nepali citizens -5.
However, diplomatic assurances provide cold comfort to workers huddled in
hotels, uncertain whether they will ever return to their jobs—or safely to
Nepal.
For the 30,000 Nepalis in Iraq—and the hundreds of thousands
more across the Middle East—each day brings new uncertainty. Will the next
drone strike hit their workplace? Will their company honor salary commitments?
Will the government evacuate them if conditions deteriorate further?
These questions have no easy answers. What is clear is that
Nepal must fundamentally rethink its foreign employment strategy. The days of
sending hundreds of thousands of workers to volatile regions without adequate
protection must end.
The Nepali workers in Iraq did not start this war. They went
abroad seeking honest work to support their families. But they are paying the
heaviest price—with their safety, their livelihoods, and in some cases, their
lives.
As one injured security guard recovering in an Iraqi
hospital told reporters, his hand and face burned by drone shrapnel: "We
were eating. Suddenly the drone exploded" -4.
That sudden explosion represents a wake-up call Nepal cannot
afford to ignore.
References
CESLAM. (2026, March 9). Uncertainty looms over fate of
Nepali migrant workers in war-torn Middle East.
CESLAM. (2026, April 10). The Cost of One Corridor.
ekantipur. (2026, March 17). Two Nepalis injured in
Iraq, 120 Nepalis working at the airport moved to hotels.
NUS Institute of South Asian Studies. (2026, April
28). The West Asia Crisis and Nepal's Misplaced Priority.
The Kathmandu Post. (2026, March 4). Kathmandu begins
evacuating Nepalis in the Gulf to safety.
The Kathmandu Post. (2026, March 14). West Asia
tensions could rattle Nepal's economy.
Nepalnews.com. (2026,
May 19). Nepal News Evening Economic Brief – March 05, 2026.
Khabarhub. (2026, March 1). Nepal suspends labour
approvals for 12 Middle East countries.
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