About 700 companies in Kuwait have been charged with human trafficking offences over allegations they bribed potential expats with illegal work visas, according to a local Arabic daily.

Nearly 1,000 employers also have been blocked from issuing new visas after an investigation found workers officially on their books were illegally working elsewhere, an anonymous ministry source told Al-Qabas newspaper.

According to local media, visa trafficking is rife in Kuwait. Traffickers exploit loopholes in the labour sponsorship system by creating work permits for fake companies or nonexistent jobs, which are sold to unskilled workers in labour exporting countries such as India, the Philippines and Sri Lanka.

When workers arrive in Kuwait often they discover they do not have a job and resort to hard labour, working without a valid visa.

The Kuwaiti government estimates there are nearly 90,000 people living illegally in the oil-rich Gulf state. About two-thirds of the 2.6m people are expats.

A crackdown on illegal workers this year has seen 25,000 people arrested, including 15,000 still in custody and 6000 who were deported.

Minister of Social Affairs and Labor Thekra Al-Rashidi announced earlier this year Kuwait would reduce the number of expats by 100,000 each of the next 10 years.

The Al Qabas report is the first indicating the government is targeting traffickers rather than workers.