The grounding of Jet Airways India Ltd., the country’s oldest private-sector carrier, isn’t just bad news for customers and its 23,000 employees. It raises yet again a question that’s puzzled two successive governments and will continue to bedevil whichever party takes power after elections conclude next month: What’s killing Capitalism in India?

Jet was born in the early 1990s, when India’s closed Soviet-style planned economy had just started embracing globalization and private enterprise. Back then, few Indians could afford to fly; now the country has the world’s fastest-growing aviation market. An airline that was at one point the industry’s dominant player should theoretically have been able to thrive.

While Jet’s costs were too high compared with those of its no-frills rivals, that issue could have been fixed. The real problem is that Jet founder Naresh Goyal gambled away a perfectly fine Read More

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