THE boss of India’s biggest domestic airline said he had scrapped plans to lay off up to 1900 employees because their tears caused him sleepless nights.All 800 employees at Jet Airways who had already been laid off were called back to work Friday – just 48 hours after they were told to go by the airline, citing large losses. Jet said earlier this week it would sack up to 1900 employees, marking the first mass layoffs in the formerly booming Indian aviation sector. “I could not sleep at night. I was mentally disturbed when I saw tears in their eyes. I apologise for all the agony you went through,” Jet chairman Naresh Goyal said.

He said he had made a “personal decision… without any external pressure.” “The management will have to understand this,” he said.India’s airline sector – a potent symbol of the country’s economic progress – is going through its “worst ever” crisis, according to Civil Aviation Minister Praful Patel. Soaring global fuel prices have forced airlines to hike fares and cut routes which have hit passenger numbers. On Monday, Jet announced a tie-up with its fierce rival Kingfisher Airlines for an “operational alliance” including joint fuel management, ground handling, network rationalisation and crew sharing.

The sector posted a combined loss of $US938 million ($A1.35 billion) in the fiscal year to March 2008 and analysts expect a $US2 billion ($A2.89 billion) dollar loss this year. Many of those laid off were newly hired flight attendants and ground crew in their early 20s. One man, Jet purser Salim Suleiman, was on leave and heard he was to lose his job on his wedding day, Indian media reported.He had to return after the ceremony to hand in his uniform, badge and security pass.

Some new employees expressed worry about repaying bank loans they had taken to pay flight-training and cabin crew school fees. Shocked employees, a number in uniform, took to the streets this week, many weeping at the unexpected sackings two weeks ahead of the major Hindu festival Diwali – a time when many in India spend heavily on gifts. Several politicians also expressed dismay at the firings. “You cannot just sack so many people suddenly,” India’s Oil Minister Murli Deora said yesterday.

Employees cheered and distributed sweets outside the Jet Airways head office in Mumbai after Mr Goyal’s change of mind.The company however maintained it still needed to cut costs in coming months as the industry seeks to fly through stormy weather. State-run carrier Air India is considering allowing 15,000 workers to take up to five years’ unpaid leave as it battles the downturn. “We will need to take some tough financial decisions,” Mr Goyal said, without elaborating.

Jet posted a full-year loss to March of 2.53 billion rupees ($A75.05 million) and has defaulted on payment of fuel bills worth 2.59 billion rupees ($A100 million) to the state-run Indian Oil Corp. The Government has rejected industry appeals for a bailout but has said it will look at cutting taxes on jet fuel and reducing airport landing and parking fees to ease the burden on the sector.