Saudi Arabia on Tuesday extended by four more months an amnesty enabling illegal foreign workers to regularise their status or return home without prosecution.
King Abdullah has ordered "extending the time limit" of the amnesty due to expire on Wednesday until November, the interior ministry said in a statement carried by the official SPA news agency.
English-language daily Arab News said the amnesty would now expire on November 4.
The ruler of the oil powerhouse had announced the amnesty on April 3, granting foreign workers a three-month grace period to regularise their residency or leave Saudi Arabia to avoid being jailed, fined or placed on a blacklist.
Security forces will launch a wide-reaching campaign across the kingdom to crack down on illegal foreign workers once the amnesty has expired, the interior ministry warned.
The embassies of Asian countries from which most of the workers hail welcomed the extension.
India's embassy in Riyadh described the extension as a "humanitarian" gesture, urging its citizens in the kingdom "to fully utilise the grace period effectively".
Deputy chief of mission at the Indian embassy Sibi George said that he hoped "that the grace will be enough" for Indians working in Saudi Arabia to regularise their status or leave.
Mohammed Nazmul Islam, consul general of Bangladesh in the western city of Jeddah, also welcomed the amnesty, saying many of his compatriots "who decide to go back... would search for a new company, a new sponsor" to stay in Saudi Arabia.
Foreign workers must have a Saudi sponsor in order to obtain residency permits.
According to the labour ministry more than 1.5 million illegal foreign workers have come forward so far. Of these, some 180,000 have left the kingdom in addition to more than 200,000 unregistered workers expelled at the start of the year under new regulations to stamp out illegal immigration.
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Foreigners desperate to work in the country are willing to pay for sponsorship, and sponsoring expatriates has become a lucrative business for some Saudis.
But under the new rules workers can be employed only by their own sponsors.
Rules mainly impact low-paid workers, most of whom are from India, Bangladesh, Pakistan and Indonesia, but with some from Yemen and Egypt as well.
They had been fearful of the campaign of arrests promised by authorities once the amnesty expires.
Human Rights Watch on Tuesday urged the kingdom to abolish its sponsorship system and allow workers in abusive situations to easily change their jobs.
Workers "suffer multiple abuses and labour exploitation, sometimes amounting to slavery-like conditions," said HRW.
"Saudi Arabia should get serious about regularising the status of its workers and do away with an abusive labour system that forces migrants into illegal employment," said HRW's Mideast deputy director Joe Stork.
The sponsorship system "ties migrant workers' residency permits to 'sponsoring' employers, whose written consent is required for workers to change employers or leave the country," said HRW.
"Employers often abuse this power in violation of Saudi law to confiscate passports, withhold wages, and force migrants to work against their will or on exploitative terms," it added.
Saudi Arabia, the world's largest oil exporter, is a goldmine for millions of people from poor Asian and Arab countries where unemployment is high.
According to official statistics, eight million expatriates work in the kingdom, where there are reportedly around two million illegal workers.
The new labour ministry regulations aim to reduce the number of foreign workers to create jobs for millions of unemployed Saudis.
Although the country has the largest Arab economy, its unemployment rate is above 12.5 percent.