Hotels and restaurants appeal to government on liquor ban

Hotel and restaurant associations are focussing on upping their engagement with the Central and State governments to get a respite from the recent Supreme Court order that has banned restaurants and hotels located in close proximity to State and national highways from serving liquor.

The Federation of Hotel and Restaurant Associations of India (FHRAI), along with six other hotel and restaurant trade bodies, met with the Tourism Minister on Monday to make a representation and apprise the Ministry about the impact of the court order.

These industry associations have argued that while the government is promoting Incredible India and looking to attract more foreign tourists through e-visas scheme, such restrictions are expected to be counter-productive and adversely impact the competitiveness of India as a tourist destination. The associations have said the implementation of the order will impact not only revenues and profitability, but also jobs in the tourism industry.

Garish Oberoi, Vice-President, FHRAI, said the industry bodies have suggested that hotels and restaurants located within city limits should be exempted from these restrictions. “We are also engaging with various State governments. This week will be crucial for us to formulate the future strategy and whether we need to take the legal route,” he added.

The industry fears that besides impacting revenues and profit margins, it could also lead to loan defaults by the hotel industry in the long term.

Hotels and restaurants in close proximity to State and national highways have already stopped serving liquor either prompted by notices from authorities or out of sheer precaution to be in compliance with the court order.

Raj Rana, Chief Executive Officer - South Asia, Carlson Rezidor Hotel Group, said the hotel chain has stopped serving liquor at several hotels located close to highways. “While we understand the intent of the order, there has to be a different solution to tackle the grave issue of accidents caused due to driving under influence. For now, we are banking on the industry voice to be represented through the industry bodies; but if this prevails, hotel players will need to look at ways to augment sales so that it does not erode the profitability.

“It will impact not only restaurant and bar revenues located within hotel premises, but also the ability of the hotel industry to host international conferences. The MICE (meetings, incentives, conferences and events) tourism segment will also be affected,” he said.

Riyaaz Amlani, President, National Restaurant Association of India, said the association is engaging with the Central and State governments. He said the implementation of the order will depend on various State governments’ interpretation of the order.

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