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Financial Crisis Indian aviation sector has been severely affected by the global financial crisis and the record high fuel prices. It is being said that Indian aviation industry, that has a $6 billion turnover, is expected loose more than $2 billion in the next year. Some private airlines had expected that the industry will grow many folds and had invested huge amounts. But nothing happened as was being expected. In recent months domestic market has declined a lot and on the other hand international developments have multiplied the losses. Financial losses have forced the Indian aviation industry rivals Kingfisher and Jet Airways to form alliance with each other.  This has been done to ‘rationalize’ routs, disconnect some operations to cut the costs. Both the Indian aviation companies were loosing crores of rupees per month.     

Sack Orders But the worst was yet to come. Jet Airways have decided to retrench its 1900 employees that includes people across all the functions- even pilots. It was announced by Jet Airways Executive Director Saroj Dutta in Mumbai on Wednesday, October 16. He said that officials have taken these measures to keep the airline ‘economically viable’ in the future. Shedding of 1900 employees had become necessary to ensure the jobs of the remaining 11,100 employees. They had even asked the state-owned Air India to come forward and form an alliance to cut the losses.

AI Proposal According to some news reports Air India has also planned to give 3-5 years of leave without pay to 15.000 of its employees. But it has been said that employees will not be forced but voluntarily can ask for leave. But it has been also included in the proposal that those employees who voluntarily go on leave will be taken back at the ’same seniority’ and ‘last drawn pay’ whenever they desire so.  But official have clarified that it won’t be retrenchment as has been done by the private carriers. But Government of India has declined to take such steps. Civil Aviation minister Praful Patel have said that there is no need to take such steps immediately as Air India is ‘in a much better financial health’. On the other hand some ministers have criticized Jet’s sack order. Some political leaders have decided to oppose the decision.