Airlines hold India to ransom

Aviation is a bewildering sector. It ranks among the finest achievements of human technical progress. It also ranks among the most difficult businesses to run profitably. Little wonder then, that in a bid to demand a bailout from the government, leading airline operators in India have called for a strike on August 18.

The pioneer of low cost airlines in India, Captain Gopinath calls the step a gimmick. He says, "The business magnates, Vijay Mallya or Naresh Goyal, know the reality: airport infrastructure is costly, oil prices are high. But they started a business and took a risk...The message to airlines is that there is lot of cost cutting they can do themselves."

He adds, "They got together as a cartel and fixed price by blaming fuel surcharge. That was the beginning of airlines’ woes - occupancy fell, collections came down and losses went up." We agree. Although the government needs to do much more in making the Indian aviation sector more viable, holding the public to ransom is hardly the way for businesses to negotiate terms.

In fact, on being asked what should the Government do if the airlines insisted on the strike, Gopinath said, "The Government can arrest airlines chiefs under the Essential Services Maintenance Act - if truckers can be arrested they can do the same thing here."