The government opened the aviation industry to private
competition in 2001. This column from Business World of 28 July 2003 describes
some consequences – for instance, a shortage of air hostesses.
Precept and practice
Foreign shores beckon the bright youths of Jet Airways.
The ground crew is not so hot; counter staff is not so scarce in the Middle
East, and earns no more than 2500 Dirhams a month. But cabin crew is the
flavour of the month; they are not only being offered twice as much, but in
addition earn handsome flight outstation allowances. A stewardess who was away
for 10 years is reputed to have come back with savings of Rs 15 million. That
has got the dovecotes buzzing with excitement.
The Middle East is a particularly
voracious market because local girls are protected from male eyes and boys do
not fancy serving meals. But the reputation of Jet service standards is
spreading, and other airlines are also looking at its well groomed army with
interest. Once it was customary for airlines flying to India to carry a couple
of Indian stewardesses, just in case they got a passenger who spoke nothing but
Indian. But now foreign airlines recognize Indian cabin staff as fully
comparable to their own, and generally more willing to work hard.
It is not just Jet Airways. The Mr or Ms India at hotel
counters is equally attractive prey. And there is not just a market for fine
faces; thanks to call centers there is also a market for convent accents. For
the first time, well trained, presentable Indians are finding an international
market.
That is hard on the travel and
hospitality industry; as soon as an employee begins to add value she is liable
to get lost, and take away the costly training with her. It is particularly
hard on Jet Airways, which has worked hard to achieve world-class standards and
become one of the world’s best airlines.
But this is how a labour market
works in times of shortage. The information technology industry has long and
bitter experience of it; while the IT boom lasted, programmers were likely to
flying away to golden California as soon as they were trained. Sometimes they
did not even bother to come back from an installation job they were sent to on
a client’s server abroad.
And the IT industry can also tell
others much about how to cope with a transient labour force. It built up a
backbone of well paid, well trained middle management with kids in local
schools, designed training courses to bring callow recruits rapidly to speed,
and standardized work procedures so well that any novice could pick up from
where his predecessor left. The industry was not simply the producer of
software; it also became a producer of software engineers.
In the same way, the travel and
hospitality industry also needs to become a vast training school.
Internationalization of the labour market is a reality, America – or even
Arabia – cannot be wished away. The best course to take globalization in one’s
stride, and to remodel one’s business to meet its demands.
But the IT industry had one
advantage: that it could offer its employees frequent trips and occasional
postings abroad. Jet Airways is precluded from doing so. The government
blatantly discriminates in favour of its own airlines, and gives them a
monopoly of international flights. They are not even capable of using the
landing rights the country is entitled to. But the government would rather
waste the landing rights than give them to another Indian airline; its only sin
is that it is a private airline. It forces foreign airlines to go into
fictitious partnership with Air India and to give it a rent for the privilege
of flying to India. When traffic declines, it terminates foreign airlines’
landing rights to keep what remains for its own airlines.
These policies are against the
nation’s interest and the laws of economics. An airline does not cease to be
Indian just because the government does not own it; and if its own airlines
have to face competition from domestic private airlines, they may lose traffic
but national airlines will gain it.
Private airlines must be given
equal rights to international flights. There are three ways of doing it. The
first is to privatize Air India and Indian Airlines; this course of action was
sabotaged by Shahnawaz Hussain before he was removed. The second is to auction
landing rights. That course has certain risks; it may lead to the entry of
non-serious bidders, who may resell the landing rights. The third is to merge
Air India and Indian Airlines, and to give domestic airlines landing rights in
proportion to their share in domestic traffic. Not all of them will want to use
them; they should be allowed to sell unused landing rights to other domestic
airlines. The BJP, when it came to power, said it would introduce domestic
competition before opening up the market to foreigners. Let is practise what it
preached.
