Syndicate fears resurface amid hopes for Malaysia labor market reopening

Highlights:

• Fears grow syndicate recruitment system could return to Malaysia
• Existing Bangladesh-Malaysia MoU blamed for enabling past syndicates
• Malaysia's conditions may restrict recruitment to few agencies
• Government vows crackdown on syndicates before market reopening
• Recruitment costs rose sharply despite official migration fee cap
• Experts urge transparency to prevent worker exploitation and corruption

Fresh concerns are emerging over a possible return of the controversial recruitment syndicate system in the Malaysia labour market as Bangladesh and Malaysia move towards reopening worker recruitment without revising the existing memorandum of understanding (MoU) that critics say enabled such practices in the past.

The concern follows a recent visit to Malaysia by a Bangladesh delegation led by Expatriates' Welfare Minister Ariful Haque Choudhury.

While the visit raised hopes of reopening the labour market after two years of closure, it also triggered fears among recruiters and migration experts that the syndicate model introduced during the Awami League government could resurface.

Infograph: TBS

"As long as the existing MoU between the two countries is not amended, the masterminds behind the syndicate will continue to take advantage. This time too, the beneficiaries of the syndicate have continued their efforts in both countries," former Joint Secretary General of the Bangladesh Association of International Recruiting Agencies (Baira) Fakhrul Islam told TBS.

"The Malaysian authorities have imposed several new conditions that encourage the formation of syndicates. Nearly 2,500 agencies in Bangladesh obtained licences by complying with government rules and regulations, but instead of giving all of them equal opportunities, these new conditions undermine the authority of our government," he added.

The issue gained further attention after State Minister for Expatriates' Welfare Nurul Haque Nur said on 6 May that Malaysia's labour market would remain closed to Bangladeshi workers unless Dhaka accepted Kuala Lumpur's conditions for recruitment. 

He noted that the market could remain shut if Bangladesh rejected what he described as either a "syndicate" or a "fair recruitment system".

According to Nur, Malaysia imposed 10 conditions that would effectively allow only five to seven Bangladeshi agencies to send workers.

However, during the interim government's tenure, it managed to waive three conditions and submitted a list of 423 recruiting agencies to Malaysia, but the market remains closed.

Nur said Bangladesh's minister had recently visited Malaysia and requested approval for the 423 recruiting agencies on the submitted list.

However, Expatriates' Welfare Minister Ariful Haque Choudhury pledged on 18 May to launch a strict crackdown on controversial recruitment syndicates in a bid to reopen the Malaysian labour market quickly.

"Our jihad is against the syndicate," he told reporters.

Asked when the market would reopen, Ariful replied, "It will happen very quickly."

How the new conditions came under discussion

On 28 October 2025, Malaysia's Ministry of Foreign Affairs sent a letter to Bangladesh requesting a list of recruiting agencies eligible to send workers based on 10 mandatory criteria.

Bangladesh later requested Malaysia to relax at least three conditions requiring agencies to have handled at least 3,000 foreign workers in the past five years, own a training centre and maintain a permanent office space of at least 10,000 square feet for the previous three years.

The request was made in a letter sent on 4 November 2025 by Asif Nazrul, then adviser to the expatriates' ministry, to the Malaysian government.

The remaining conditions include holding a valid licence for at least five years, experience in sending workers to at least three countries, possession of a good conduct certificate and no record of involvement in forced labour or human trafficking.

According to the Ministry of Expatriates' Welfare, agencies from Bangladesh, India, Nepal, Pakistan and Myanmar will be selected under the same standards.

However, Nepal rejected Malaysia's proposed standards for recruitment agencies, according to local media outlet The Annapurna Express.

At the time, many Baira members urged the government not to comply with what they described as unfair conditions, warning that they could pave the way for another syndicate by limiting recruitment rights to a small number of agencies.

Frequent closures since syndicate system introduced

Recruiters say the syndicate system dates back to 2010, when the number of approved agencies was initially limited to 10 before expanding into a powerful mechanism controlling labour migration. 

More recently, a syndicate involving 100 agencies has been accused of syphoning off thousands of crores of taka and failing to send around 18,000 workers to Malaysia before the May 2024 deadline.

Malaysia's labour market for Bangladesh was first closed in 2008, reopened in 2016 and shut again in 2018 amid corruption allegations. It reopened in 2022 before closing once more in 2024.

Though BNP governments in 1991-1996 and 2001-2006 did not face such allegations, insiders now fear that the current process, if not transparent, could lead to a resurgence of the same system.

Following the recent visit to Malaysia, Prime Minister's Adviser Mahdi Amin said efforts were under way to ensure low-cost migration, expand opportunities for skilled workers and dismantle syndicates.

A joint statement issued on 9 April said both countries had agreed to recruit workers through "credible and qualified" agencies based on Malaysia's sectoral needs. However, sector insiders question the ambiguity of those terms and warn that the selection process itself could become a gateway to forming a new syndicate.

Altab Khan warned that any return of syndicate practices under a BNP-led government would seriously damage the party's reputation.

"If syndicates return, it will break BNP's clean record and erode public trust," he said.

Mohammad Rashed Alam Bhuiyan, who completed a PhD on the Bangladesh-Malaysia labour migration corridor, said influential groups in both countries had long played a role in forming syndicates that ultimately exploited workers.

"If the current government follows the same path, it will be difficult to bring transparency to the labour migration sector and create jobs at a lower cost," he said, urging Bangladesh to engage more actively with Malaysia to avoid what he described as irrational conditions.

The joint statement also said Malaysia planned to introduce a technology-driven, AI-based recruitment system aimed at reducing intermediaries, lowering costs and ensuring employers bear recruitment expenses under the International Labour Organisation's Employer Pays Principle.

Bangladesh expressed support for the initiative, but Fakhrul Islam questioned whether the "zero-cost migration" concept could become another avenue for syndicate control.

"By promoting zero-cost migration, there is a risk of encouraging syndicate control again. Eventually, workers will still bear higher costs, while most agencies will face discrimination," he said.

Stakeholders argue that dismantling syndicates is possible if Bangladesh adopts a firm negotiating position. They point to Nepal, which reportedly resisted similar pressure while continuing to send workers to Malaysia without syndicate control.

"Malaysia alone cannot impose a syndicate. Bangladesh can prevent it if it wants to," said RMMRU founding chair Dr Tasneem Siddiqui.

Before 2008, Bangladeshi workers could secure jobs in Malaysia by paying recruiters between Tk1.8 lakh and Tk2.2 lakh. By May 2024, the cost had risen to nearly Tk6 lakh despite the Ministry of Expatriates' Welfare fixing the official migration cost at Tk79,000.

Baira sources estimate that the syndicate of 100 agencies siphoned off at least Tk14,000 crore after the market reopened in August 2022. 

Since the fall of the Awami League government on 5 August, many alleged syndicate leaders are said to have fled the country or gone into hiding, while several cases have been filed against agencies accused of involvement.