An uncomplicated, unblemished Haj
To nobody’s surprise, the clamour is growing louder among Muslims to wind down the Haj subsidy.
The government bankrolls the pilgrimage by partly paying the airfare to Saudi Arabia. However, the subsidy actually goes in bailing out Air India, while exposing Muslims to charges of appeasement.
The UPA government’s plan, which is under evaluation, to gradually stop financing the Haj pilgrimage is a step in the right direction, several Muslim leaders told me recently.
From the Muslim Personal Law Board and Jamiat Ulama-e-Hind to the Milli Council, many organisations have said it was time the government pulled out of the Haj business.
Why? A major gripe is that Air-India’s fares are sharply higher than routine fares. The money indeed is used to cross-subsidize the national carrier. Over 1,50,000 Indian Muslims travel to Mecca each year for Haj, one of the five pillars of Islam.
That’s approximately the total number of passengers flying across all domestic airlines on any given day if they run to capacity. That’s big business too for Air India, helping it keep afloat. It should indeed be big business for any airline.
Yet, Air India jacks up fares during Haj to more than double, ostensibly on the grounds that it has pull out planes from regular operations for dedicated Haj travel. This runs contrary to economies of scale, which imply that greater the business volume, lower the costs to consumers.
There’s a reason why successive governments have sustained the Haj subsidy.
Scrapping the subsidy or scaling it down could ground Air India, financially always in the doldrums. When was the last time it posted noticeable profits? Its pilots, crew and other staff frequently encounter delayed salaries. Now, imagine lopping off 1,50,000 assured passengers annually from an airline’s business, especially one deep in the red? That’s lopping off a major chunk of its shrinking revenue.
Rajya Sabha deputy chairperson K. Rahman Khan had told me that he had suggested Prime Minister Manmohan Singh to “corporatize” the Haj Committee, the body that makes all arrangements, so that the subsidy could be gradually withdrawn.
Indian Haj authorities should get powers to float global tenders for airlines to ferry over one-lakh Haj pilgrims, a move that would end Air India’s monopoly. A decades-old treaty between Saudi Arabia and India effectively stipulates that only the Saudi national airline and India’s national carrier should ferry Haj pilgrims. Scrap it.
“The subsidy has been inconsequential,” Rajya Sabha MP and Jamiat leader, Mahmood Madni told me the other day.
Global tenders for airlines should be floated so that the lowest bidder gets the job.
Imran Kidwai, chairman of the Congress’s minority cell, said the government would consult the community’s stakeholders to settle on a consensus model, like Malaysia’s Tabung Haji.
Each year, the Cabinet decides how much the Haj Committee, the facilitating agency, should charge as airfare. Last year, passengers were charged Rs 12,000 each. The remaining part of the fare is paid directly by the government to Air India.
Going by last year’s subsidy of about Rs 826 crore, the Air India fare must have been between Rs 80,000-90,000 per passenger, when current round trip economy fare to Jeddah is about just about Rs 18,000.
The government should now consider giving three-year’s subsidy at one time as seed capital to the Haj Committee and stop the subsidy after that, according to Manzoor Alam, the Milli Council chief. Fair enough.
India should switch to a Malaysia-like model of Tabung Haji. Under the Malaysian model, each prospective pilgrim contributes money towards future Haj travel to a Shariat-complaint corpus of fund, something like India’s Public Provident Fund.
When the money becomes adequate to meet an individual’s total Haj expenses, it can be used to pay for the pilgrimage. Malaysians therefore fund their own Haj travel. Indians can do the same.
The subsidy money saved by the government, or a major part of it, should instead be used to finance the ministry of minority affairs. The allocation will not just be enough to run the ministry’s non-plan expenditures but also help it considerably widen its welfare schemes.