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Home > Business > Special

A rough landing

Amrita Dhar | May 17, 2003

It's an invariable routine for Kader Khan, manager, Cambata Aviation. Every evening about 2100IST Khan (name changed) slings his identification tag around his neck and walks through the entrance at Indira Gandhi International Airport.

As one international flight after another comes in, Khan is in constant firefighting mode, and the walkie-talkie strapped to his waist is buzzing every now and then.

But, as he goes through the nightly routine, Khan has one great worry, hanging like a sword of Damocles over his head: in a few months he may be out of a job. The only consolation, if it is any at all, it that he won't be the only one.

About 30,000 airport workers, ranging from ticket counter staff to baggage handlers, could soon be getting pink slips because of new regulations being introduced by the government.

The countdown has begun for a giant changeover in India's airports. Starting in October the government wants three public sector companies-- Air-India, Indian Airlines and the Airports Authority of India-- to take over all ground-handling jobs at the country's airports.

That means everyone from the person behind the counter when you check in, to the staff who clean the aeroplanes, will be from one of the three public sector concerns.

Who is affected by the new regime that the government wants to introduce? The answer: practically everyone.

Foreign airlines will have to withdraw their staff from the airports. So will the domestic carriers like Jet Airways and Sahara Airlines. Jet has about 4,800 airport staff scattered around the country and Air Sahara has about 1,500.

Says Uttam Kumar Bose, CEO, Sahara Airlines: "We are going to the government, otherwise so many people will lose their jobs."

Why is the Government proposing drastic changes that would put people out of work and cause large-scale disruption? That's a mystery that nobody appears very clear about.

One reason is that Air-India is desperately short of cash and the government sees this as an easy way for it to earn more money. The ground-handling industry is reckoned to be worth around Rs 1,000 crore (Rs 10 billion).

One company that will be particularly hard hit is Cambata Aviation, which has carved a niche for itself in the ground-handling business.

Cambata, which has been in business since 1967, employs about 3,900 people and does the ground handling for 16 international airlines including British Airways, Air Swiss, Cathay Pacific and Gulf Air.

There are others that will be badly hit. Many international airlines like KLM, Malaysia Airlines, Emirates and Air France do their own ground handling and between them employ about 5,760 people. There are also others like Ground Globe India, a Lufthansa subsidiary which employs 200 people.

"The workers are very depressed about the whole issue, but we have asked them to remain calm for the present. We can't do anything concrete because the government has not officially said anything yet," says an executive of a private ground-handling company.

As D-Day approaches there are fears about widespread industrial action. Most of the large private companies have unions. In fact, Cambata Aviation's union has Shiv Sena affiliations.

There are rumours that a spate of strikes might start which would paralyse airports around the country. For the time being, however, the workers are sitting tight until a final decision becomes clearer.

In fact, there's still a slight doubt whether the Government will actually go ahead with the scheme or not. In principle it has clearance from the Cabinet Committee on Security for the move and it should have been implemented on July 1.

In actual practice there are signs that it is beginning to realise the sheer enormity of what it has just undertaken and the disruption it could cause. It has just pushed back the start date from July 1 to October 1.

That isn't all. The government is now suggesting a staggered approach so that the new scheme will be implemented in Mumbai and Delhi airports to begin with.

It will then be extended to the other international airports and finally to the domestic airports. The process, the ministry now hopes, will be completed by December.

The government argues that it isn't doing anything out of the ordinary. After all, there are other places in West Asia like Dubai where ground handling is taken care of entirely by government-run organisations.

In Dubai, for instance, DNATA, (the Dubai National Air Transport Association) runs the spanking new airport and all the services that it provides. Even in India's first private sector airport at Kochi, opened in 2000, the ground handling is performed by public sector companies.

What's more, the government argues that it has been forced to take this step because of heightened security fears since 9/11.

Soon after the CCS announced its decision, Civil Aviation Minister Syed Shahnawaz Hussain went on record to say that companies or agencies engaged in ground-handling services had an access to highly sensitive areas such as runways, parking bays, taxiways and cargo storage.

The security angle has, however, been interpreted in rather unusual ways. Obviously, organisations like Air-India and Indian Airlines won't be able to hire new staff in such a short time.

So, they've been allowed to form joint ventures in which private sector companies will be allowed a 49 per cent stake. That means, effectively, that private sector companies like Cambata will still be doing the same job.

That means that the security threat will vanish the moment the private companies team up with the public sector concerns like Air-India.

"The private agencies and airlines have very little to choose from if they do not form joint ventures. The former faces liquidation and the latter an erosion in customer service," says an industry expert.

There are other unexplained issues that the Government is blissfully turning a blind eye towards. Air-India hires short-term contract staff to carry out its ground handling. That itself should be a security threat under the new parameters.

"The irony is that both IA and A-I outsource about 40 per cent to 50 per cent of the staff they employ in ground-handling services through contracts, even though the rules specifically say that only full-time bona fide employees of the agencies will be permitted to provide the services," says an executive of a private ground-handling agency.

But most international airlines are not openly protesting against the decision. The reason is they are scared to protest against the government which has wide-ranging powers in areas like bilateral rights and other commercial agreements.

In fact, the only airlines which raised objections were private domestic carriers Jet Airways and Air Sahara. The two airlines fear a steep drop in quality of ground handling and losing their competitive edge as a result.

They point out that nowhere in the world has ground handling been privatised for domestic airlines. After all, city-states like Dubai and Singapore don't have a hinterland or a domestic air service.

"The margins in the domestic aviation market are very little, therefore service is of paramount importance. This is bound to suffer if we hand it over to outside agencies," says a top Air Sahara executive.

The frantic lobbying by both airlines did have its effect. Initially, the Aviation Ministry shot off a proposal to the Home Ministry suggesting that domestic airlines should be allowed do their own ground handling as is done at present.

The home ministry, however, turned the proposal down saying that if security was the concern, the domestic and international carriers couldn't be treated differently. Now, there are indications that the government could be about to perform a somersault.

Indian airports, like others around the world, are mini-towns in their own right. About 9,500 people work in Mumbai's national and international airports and slightly over 7,000 in Delhi. They are all waiting worriedly to see if the government's grand scheme will finally get off the ground.

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Number of User Comments: 3

Sub: jet airways staff outsourced and unemployed

well what everybody is talking about sahara unemployment well the people working in jet airways are getting outsourced and thrownout well it seems like jet ...

Posted by munish

Sub: This is unlawful.

Well my perception is that the government is not doing correct in this issue and that since the unemployment is rapidly increasing the govt. should ...

Posted by Deepak

Sub: Proposal will destroy the aviation industry

Can the home minister guarantee the safety of passengers? Does he have any statistics to support the change of guard? It is nothing but a ...

Posted by RK Agnost



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