India - 3 lakh travel agents may lose job

Manisha Singhal

Slowdown-hit airlines stop paying commission.

More than 3 lakh travel and ticketing agents may lose their jobs with airlines stopping payment of commission to them from November 1.

The decision has seriously impacted the business of more than 29,000 non-IATA agents across the country, who only sell airline tickets. They account for more than 90 per cent of the trade and employ over 3 lakh people. Smaller agents employ around 10 people on an average.

A few months ago, cash-strapped airlines decided to do away with a 5 per cent commission they used to pay to travel agents as a cost-saving measure, aligning themselves with the global trade practice.

Instead of paying the agents directly, the airlines have asked them to charge a transaction fee of Rs 1,500-2,000 on domestic sectors and Rs 3,500-7,000 on international routes from customers.

"In India, we do not see clients paying directly to the travel agents that kind of amount unless it is incorporated in the airfare. That is not acceptable to the airlines. This move will directly impact the livelihood of about three lakh people who are in this business. On the one hand, the government is assuring us that there will be no job loss and on the other, we are facing this threat," said Vasuki Sundaram, chairman, Travel Agents Federation of India, TAFI).

A travel agent based in Mumbai added, "Travel agencies will close down and the small and medium segment guys will perish as the bigger consolidators will undersell to take advantage of the current situation and will offer tickets for lesser commission as service fee. There is total confusion right now and the entire industry is in a state of flux."

Many agents have already stopped selling tickets for international carriers such as Air France-KLM, Qatar Airways and also Northwest Airlines.

"There are also agents who have stopped selling tickets of Jet Airways and Kingfisher Airlines. Jet's ticket sale through agents has seen a dip of 40 per cent. We are still in talks with them, but if nothing comes out, we will stop selling these airlines too," said Sundaram.

The total value of consolidated air tickets issued on an annual basis in India is in the range of Rs 34,000-36,000 crore