The Hotel Association of India (HAI), the apex body of the Indian hospitality industry, met G Kishan Reddy, Union Minister of Culture, Tourism and Development of North East Region, and apprised him of the status of the industry severely impacted by the ongoing pandemic.
A delegation of the association led by its Vice President, K.B. Kachru, Chairman Emeritus & Principal Advisor-South Asia, Radisson Hotel Group, also reviewed the issues that the industry is facing.
While highlighting the urgent need to infuse liquidity in the industry through means like extension of moratoriums, one-time loan re-structuring, improved terms under the ECLGS scheme and revised eligibility ratios under the resolution framework, the association also requested a consideration of policy changes.
According hospitality the status of an “infrastructure industry” by the central government, thus allowing it to avail the benefits of low cost funding and tax benefits that are currently available to industries like ports, railways, highways etc, is one of the policy changes that the industry has been clamouring for using the rationale that hotels are capital intensive and have a long gestation period, similar to infrastructure industries.
Encouraging all states to accord hotels the status of an ‘Industry’ as recently notified by some States is another policy recommendation articulated by the delegation to support the revival of the industry. A large percentage of hotel operating costs are fixed in nature making them unsustainable under the current conditions. Industry status will allow hotels to receive benefits available to manufacturers like lower property taxes, land at subsidized rates, and lower costs of utilities like power and water.
After hearing the delegation’s pleas, the minister promised to look into the issues and to continue the dialogue with HAI.