Iran's attack on Dubai (Photo – Rashid X post)

The renewed military conflict between the United States and Iran has begun rattling the global economy once again, with crude oil prices climbing and India facing a two-pronged impact. The first is rising inflation caused by costlier crude. The second, arguably more immediate, concern is the livelihood of millions of Indian workers employed across the Gulf, who send home substantial remittances that form a crucial part of India's foreign exchange reserves.

Thousands of Indians working in Dubai now find their jobs under threat. Missiles struck the UAE capital during the latest round of hostilities, raising serious security concerns. Indian migrant labourers say the fallout has been swift — job losses, reduced wages, and a slowdown across Dubai and the UAE's tourism and aviation sectors, with business activity more broadly also taking a hit. According to the New York Times, UAE officials have described the downturn as temporary, though many workers on the ground describe a starkly different reality.

Domestic workers left without employment

Women employed as domestic helpers have been particularly hard hit, struggling to find work since the conflict escalated. Joy Vivanda, a Filipino domestic worker in Dubai, has spent recent days searching the streets for employment, so far without success. Returning to the Philippines isn't an option for her, she says, as her earnings in Dubai support her four children.

Indian accountant Mujeeb Rahman, who worked for a catering company, said his employer's business had ground to a complete halt, with insufficient cash flow to pay staff and suppliers. He noted that several companies have frozen new hiring altogether. Indian hotel housekeeper Venkat lost his job and returned home in April, and now faces difficulty covering his children's school fees. He added that a brief ceasefire had raised hopes of improvement, but renewed strikes between the US and Iran have kept the situation uncertain.

A ManpowerGroup survey of 546 UAE employers found that one in four is planning job cuts in the third quarter of 2026, while roughly a third have no plans to hire at all.

How is the government responding?

The UAE has rolled out support packages worth over $680 million to help businesses weather the downturn. In an interview in April, Economy and Tourism Minister Abdulla bin Touq Al Marri described the impact of the war as a temporary disruption. Khalid Jassim, CEO of Dubai Investments, echoed this view, saying conditions were expected to improve soon.