New Delhi, May 26: India is contemplating a memorandum of understanding (MoU) on labour with countries in the Middle East to establish appropriate institutional arrangements and better working conditions for its workers engaged there.

Minister for Overseas Indian Affairs Vayalar Ravi, who recently visited Gulf countries, suggested that the government could sign an MoU with Saudi Arabia, the United Arab Emirates, Kuwait, Oman, Bahrain and Qatar in the Gulf as well as Malyasia for more employment opportunities and the protection of existing labourers.

The Minister, who reportedly submitted a report on his foreign tour to Prime Minister Manmohan Singh, proposes to create an overseas Indian welfare fund for the benefit of its citizens abroad.

The Ministry also plans to launch a national initiative for skill upgradation of potential emigrant workers.

"We are in consultation with other concerned departments. The objective of the programme would be to position the potential overseas Indian worker as skilled and trained manpower," a Ministry official said.

"It should enable him or her to go up the wage chain," the official told IANS.

He said the visit had helped the Minister and the officials get first-hand information about the "exploitation, abuse and benign neglect" Indian workers have been facing at their work places.

There are around five million Indian workers in Gulf countries - Bahrain has 400,000, the UAE 1.8 million and Saudi Arabia has 1.4 million.

"These workers play a crucial role in our economy. The remittance made by overseas Indian workers to India is estimated at $15 billion annually," the official said.

During his visit to Bahrain, its crown prince and the labour minister had assured Ravi that the country would introduce labour market reforms, which would define standards for work conditions and terms of contract for overseas workers.

"The Bahrain government assured that there would be institutional arrangements to deal with the cases of exploitation and abuse of workers, implementation of contractual obligations," said the official.

During Ravi's meeting with UAE Minister of Labour Ali Bin Abdullah Al Kaabi, the latter expressed his concern over the recent incidents of rioting and violence by Indian workers, saying that the violence of any kind would not be tolerated.

Although the Minister asserted that India would not encourage violence as a means of protest, he drew the labour minister's attention to issues such as non-payment of salaries, poor working conditions and exploitation of workers by foreign employers in the UAE.