New Delhi: Saudi Arabia has officially abolished the 50-year-old Kafala system. This was a labor sponsorship framework that tied foreign workers’ living and employment rights to a single company or employer. According to a TOI report, this change was announced in June 2025, but it has now been officially abolished. The abolition of the Kafala system has liberated more than 13 million foreign workers, including millions from India.
What was the Kafala System?
The Kafala system, known as ‘sponsorship’ in Arabic, was a modern sponsorship route that has been in use in Gulf countries since the 1950s. The Kafala system is common in countries like Saudi Arabia, Qatar, Kuwait, and Jordan. Under this system, the legal status of foreign workers was directly linked to their company (kafeel). This gave the company greater power over the workers. Workers bound by the kafala system could neither change jobs, nor leave the country without the company’s permission, nor could they receive legal assistance. This led to widespread exploitation of workers.
Why was the kafala system introduced?
This system was designed to transfer legal and administrative responsibility (including visa and residency status) for the foreign worker directly to the company or individual where they were working. Simply put, the worker’s responsibility rested with the kafeel. The kafala system relieved the state bureaucracy of its burden, as the kafeel personally handled all the work. Over time, this system began to be criticized for violating the workers’ human rights. They were often forced to live a life of slavery.
What changes have been made?
Saudi Arabia’s recent labor reforms have replaced the kafala system with a contract employment model. According to the Saudi Press Agency (SPA), the new system will allow foreign workers to join a new company without the permission of their current employer, or kafeel (employer). Workers will now be able to leave the country without an exit visa and will be allowed to take advantage of legal protections that were previously unavailable. Saudi Arabia is reforming the country under Vision 2030, and abolishing the kafala system is part of this initiative.
How many workers are under the kafala system?
More than 13.4 million foreign workers in Saudi Arabia are working under the kafala system, representing 42% of the country’s population. The largest groups of foreign workers are from Bangladesh and India, followed by workers from countries like Pakistan, Nepal, Sri Lanka, and the Philippines. Saudi Arabia employs over 4 million foreign workers in domestic work. Most foreign workers work under the kafala system in fields such as construction, domestic work, hospitality, and agriculture, and face significant hardship during this period.
What will be the impact of the abolition of the kafala system?
Saudi Arabia’s abolition of the kafala system will transform the working lives of approximately 13 million foreign workers. They will now be able to take jobs in new companies, leave the country without an exit visa, and exercise their legal rights. This change is expected to reduce exploitation, improve working conditions, and provide workers with greater freedom and respect. By giving foreign workers the right to negotiate more fairly on terms, this reform will strengthen economic participation.
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