The hospitality sector and restaurants have been among the worst hit due to the pandemic and the nationwide lockdown, but to their displeasure, there was nothing specific for the sectors in the mega economic package announced by Finance Minister Nirmala Sitharaman during the week.
Industry players have expressed displeasure over the lack of support for the sectors which are major employment generators for the economy and have been incurring nearly zero revenue over the past couple of months.
K.B. Kachru, Chairman Emeritus and Principal Advisor of South Asia, Radisson Hotel Group, told IANS that although there is no stimulus for the sector, the fine print of the decisions will have to be read regarding corporate relief and reform measures including moratorium and insolvency to understand the actual relief that may come through.
"Actually for us it's certainly disappointment and disbelief and we really don't know how things will turn out because I think we have the responsibility of huge manpower and any particular sector contributing almost 10 per cent of GDP, if that sector is totally ignored... you feel a state of disbelief," he said.
Noting that the industry was expecting a survival package, Kachru said there was need for a push to domestic tourism through incentives for travel.
He further said that the industry will again reach out to the government for immediate relief.
"We will continue, we will not give up, because this is too serious a thing to just accept. We cannot accept the situation as it is, and we have to go on at it," Kachru said.
Describing the financial state of the sector as being "on ventilator support", Sanjay Sethi, MD, Chalet Hotels said that the sector will now expect support from the states in terms of electricity tariff, excise fee waiver, property tax reduction among others.
"We are disappointed that the hospitality sector which is on ventilator support did not get specific relief. We urgently needed the government to facilitate a one-time restructuring of loans by banks without they having to take a provisioning hit," he said.
Sethi also pointed out that the sector needs soft loans for working capital.
Similarly, restaurant body NRAI, which had also sought several relief in terms of wages for employees among others, expressed its displeasure over the economic package.
"We are very sad and extremely disappointed that the Finance Minister chose to completely ignore this sector in these five days of announcements of stimulus package. This is fairly surprising considering that we as a sector employ 7.30 million (73 lakh) people and are the second largest employer of human capital in India after agriculture," said Anurag Katriar, President of National Restaurant Association of India (NRAI).
He said that the sector is now staring at large scale close down of businesses and massive loss of employment.
Reiterating the demands of the industry body, Katriar said sought Input Tax Credit on GST, declaration of the pandemic as an incident of Force Majeure for the sector, working capital on easier terms and six months moratorium among others.
"If you see, our demands were not causing any major drain on the exchequer. We totally understand the importance of the message of self-reliance given by the Prime Minister, but we do need better policy framework to make ourselves self-reliant," the NRAI President said.
Hospitality industry’s apex Association Federation of Hotel & Restaurant Associations of India (FHRAI) too expressed deep disappointment at not receiving any stimulus from the government and called for immediate action in the form of a stimulus package for hospitality to help the industry from ‘unfathomable’ consequences.
“With not even the slightest reassurance, let alone any stimulus or relief package, from the government, the industry is decidedly looking at a major catastrophe including massive job loss, bankrupt enterprises and definite closure of at least 70% of hospitality establishments across the country,” FHRAI said in a statement.
Gurbaxish Singh Kohli, Vice President, FHRAI and President, Hotel and Restaurant Association of Western India (HRAWI) said that the entire industry is confused, hysterical and in disbelief. “The hospitality and tourism industry generates close to Rs.17 lakh crores contributing roughly 10 per cent of India's GDP and supports over 43 million jobs translating to almost 9 per cent of its total employment. Despite this knowledge the Government has chosen to completely ignore us, yet again,” he added.