October 17, 2008

Jet Airways Reinstates Laid-Off Staff

The chairman of India's leading private airline Jet Airways, Naresh Goyal, has reversed plans to lay off 1,900 staff, but has not commented on whether the reinstated staff will have to take a pay cut.

Mr Goyal has said that the sacking was not a result of its broad-based cost-saving alliance with another private airline, Kingfisher. He has also denied that the airline had reversed its decision due to political pressure.

The airline's management had stated that it had to adopt job cuts as a cost-saving exercise, while Mr Goyal said that he was not consulted before the announcement. Industry observers said that retrenchment in the Indian airline sector remains a major concern.

Meanwhile, Indian aviation firms have been asked to pay up fuel dues in excess of their credit limit. Jet reportedly owes INR8.5 billion in unpaid fuel dues. The Indian civil aviation minister Praful Patel has called for the rationalization of aviation fuel prices, while ruling out any government-backed bailout of the industry.