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Millennium Post

A bleak picture

A bleak picture

Since Jet's closure of services a little over a week now, distinct realities have struck more than 16,000 employees right at their doorstep. From selling their assets to digging deep into their savings, all that the stranded Jet Airways employees have by their side is hope. And, hope keeps one in pursuit until the reality hurts one's essential needs. This hope rests firmly on potential buyers who will rescue the sinking Jet which has been declined survivability aid of around Rs 983 crore by the lenders' consortium led by SBI. This brought Jet to shut its operations on April 17 and remain incapacitated in paying salaries to its massive employee base. The plight of employees is further aggravated by the lack of communication from the company. Their dilemma of waiting for Jet's revival or taking up an alternate offer has shades of setback written all over it. Immersed in over Rs 8,500 crore of debt, Jet's fate is in the hands of the banks awaiting final bids till May 10 post which a decision over the airline would be taken. Meanwhile, employees including engineers, flight crew and cockpit crew staged a candle march at Jantar Mantar – a second in as many weeks – appealing to the lenders and the Centre to "Save Jet Airways". In fact, the National Aviator's Guild (NAG), which represents pilots of the grounded carrier Jet Airways, wrote to the Prime Minister requesting direct intervention into the matter with priority plea of directing the bank to release one months' salary to the employees. NAG also forwarded its request to stop the de-registration of aircraft which will potentially benefit competitors re-registring those under their name. Amidst other demands, NAG's apprehensions were crystal clear regarding the potential loss it will face due to inactivity. The news of Jet's senior technician allegedly committing suicide due to financial distress triggered by cancer highlights the uncertainty which can induce mental trauma. With its slots temporarily being transferred to other carriers in order to reduce inconvenience for passengers and facilitate induction of additional capacity, the road does not augur well for Jet Airways. Underpressure employees have no alternative but to seek jobs now even as some resist losing hope. HR and recruitment companies have reported an increased rush in ex-Jet employees seeking jobs with at least 1,300 pilots out of job. Not just direct employees but several businesses associated with the airline are also facing the brunt of Jet's downfall. The airline owes at least Rs 3,500 crore to vendors, in-flight caterers and hotels. Jet's shutdown has also shot up freight rates since Jet's share in freight transfer was significant. It has also hurt the fresh produce export to Europe.

With a debt more than $1.2 billion, Jet's shares have sunk with an evident downward trend maintained while those of rivals are soaring; InterGlobe (IndiGo) and SpiceJet have become the most expensive airline stocks globally as Jet bites dust. From being one of the finest in the country, Jet has now been reduced to the mercy of potential bidders who may rescue it from the debt it has sunk in. Jet's downfall brings back the Kingfisher episode wherein a prime airline collapsed with its employees not being paid eight months of salary. There is no aggregate learning acquired from Kingfisher's demise. And, the story does not end here for Jet's situation points fingers towards the airline sector which has had many episodes of uncertainty. Air India is a case in point. While Jet looks to be revived, service providers to the grounded airline may move towards insolvency procedures if their dues are not paid within a stipulated time. While Jet combats the befallen crisis, it should be considered that PSBs cannot often be brought into the fray and expected to bail out private entities. The Aviation industry needs reinvigorated policymaking to prevent such crises. India's growing market has the potential to make its aviation industry a global leader, yet we witness the demise of another airline. Policies guide the growth of an industry and it is therefore upon the policymakers (Central government) to ensure a robust growth trajectory. Employees are paying a very high price for the haphazard policies that govern the sector. One of the premium carriers is down and while the government is being re-elected, it is already upon the next incumbent to refurbish the industry and make India one of the world's leading markets. And, examples of Sahara, Kingfisher, and Jet may help in remembering the sombre episode our aviation industry had to go through.

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