Hotel & Restaurant Association of Odisha (HRAO) in a written communication to Indian tourism Minister, Prahlad Singh Patel has highlighted the lack of support to hospitality players in the state.
The communication has pointed out that in spite of the association’s continuous appeals explaining the miserable situation faced by the sector there has been no relief extended to the industry by either center or state governments.
“Sir, as you are aware, it is not only this extraordinary pandemic situation the industry is facing now, but we have also explained to you that the tourism industry will take more time to pick up than other industries. Although the government has allowed hotels to open, you are also aware that the demand is under severe stress as people are scared to travel by trains and flights at present,” said J K Mohanty, Chairman, HRAO.
Credit rating agency ICRA notes that like the US. and China, the Indian hospitality sector is largely domestic, with 77% of guests in hotels coming from inside the country. India’s share of business travel is fairly high at 59%. With this context set, it remains to be seen how an Indian recovery could potentially look like. In the case of China, it has seen the first recovery in drive-to leisure destination, followed by mid-scale business travel. However, in India business travel is likely to recover first, with mid-scale and economy before luxury. Group business cancellations will continue well into the end of 2020, if not longer. The start of the recovery is about three to four quarters away and contingent on a cure or a vaccine. Normalcy could be much further away, over to two to three years.
On the other hand, HRAO expressed happiness on the Indian tourism ministry asking state governments for Action Taken Report on the relief provided to the sector by the latter.
As per Action Taken Report, the tourism minister had sought details about relief provided by the state governments for public sector undertakings and urban body on excise license fee for hotels and resorts, relaxation on electricity charges and duties as well as fixed costs (minimum demand) charges on electricity for hotels and establishments.
“You have also sought for relief provided on property tax and reducing the current rate by half for hotels and hospitality sector besides waiver of interest on interest on the moratorium period issued by the Reserve Bank of India,” said Mohanty in the communication to the Indian tourism minister.
The government has allowed 30% of establishment in Odisha to be opened for tourists. HRAO in the communication reiterated the contribution of the tourism and hospitality sector in terms of employment, foreign exchange earnings and the country’s image building.