Jet Airways Reinstate nearly 2000 Workers Sacked 24 Hours Earlier

The extraordinary about-face -- symptomatic of the way business is done in India -- came amid reports that the Government, faced by a looming general election and fearing a voter backlash, had come down "like a ton of bricks" on Jet management over the sackings.

This was denied, however, by the chairman, Naresh Goyal, who told a late-night media conference that he had been moved to revoke the decision after watching tearful employees staging street demonstrations to get their jobs back. "This morning, when I saw tears in their eyes I could not sleep," he said. "All of you are my family. I've always said that from day one. Each employee is part of my family. "My management took this decision on the basis of certain economic conditions. As the head of the family, my conscience does not allow me to look at just the economics."

Mr Goyal denied that he came under intense pressure over the sackings, which involved the largest number of employees laid off in a single displacement by any company in Indian corporate history.

Few, however, doubt that it was, indeed, political pressure that forced the backdown, especially after a spokesman for the dominant Congress party, which is seeking re-election in the coming poll, railed against the mass sackings, saying: "This is India, not America. We are against the hire-and-fire policy of the aviation industry. You cannot have such a policy in a democracy."

Where the enforced backdown leaves the airline and the executives -- some highly paid foreigners hold key positions -- who ordered the mass sackings remains to be seen. Analysts point out that all the dire indicators that led to the sackings remain in place.

"The airline, on its own admission, is in deep trouble. Now they have 2000 employees on their payroll that they have said they do not need and do not want -- all because the chairman says he was moved by their tears. All this says a lot about doing business in India," one industry analyst said.

The depth of the crisis in the airline industry was reinforced last night when the national carrier, Air India, said it was seeking "a creative way of shedding flab".

Insisting it was not sacking anyone, the airline said it was offering voluntary leave without pay to 15,000 employees that would allow them to "go away" -- and off the payroll -- for between three and five years.