The Federation of Associations in Indian Tourism & Hospitality (FAITH) said that it has reached out to the Reserve Bank of India, Ministry of Finance, Ministry of Civil Aviation, Ministry of Commerce, Ministry of Tourism, Niti Aayog for structured fiscal and monetary support. FAITH is the policy federation of all the national associations representing all tourism, travel and hospitality industries.
The pandemic has brought the tourism, travel and hospitality industries to a screeching halt. FAITH cited the Systemic Risk Survey carried out by the Reserve Bank of India as part of its Financial Stability Report for July, with 90% of respondents putting the prospect of recovery in the next six months as bleak. 84.6% of respondents put recovery prospects in the next six months for the aviation sector as weak.
Along with the survey, FAITH cited GST and IT data from Q1, and that they expect 75% of this fiscal year to be compromised till a vaccine is available.
The organisation recently pegged the economic value at risk due to the pandemic to be at Rs 15 lakh crore.
It made individual demands to various ministries. From the Finance Ministry, it sought fiscal and statutory fund — a COVID-19 tourism funds to help businesses support operating costs and employees, access to low-cost funds, and a waiver of statutory payment obligations for FY21.
From the Commerce Ministry, it sought help with credit for Service Exports from India Scheme (SEIS) against forex earnings, and SEIS rate to be at 10%, and that this may be made available for FY20 as well as for the period of Foreign Trade Policy (FTP) 2020-25, with 500 basis points additional for lean periods.
They also reached out the Civil Aviation ministry, it asked for a policy mechanism which would help ensure that travel agents and tour operators get their refunds on time from domestic and foreign airlines. It also asked for air connectivity to expand to other parts of Asia, Europe and Africa, apart from existing air bubbles.
From the RBI, they asked for a sector-specific monetary package as well as a restructuring package.
“Almost all segments of the tourism industry (inbound, domestic or outbound) will remain highly stressed whether they are travel agents, hotels, tour operators, restaurants, tourist transporters and any other tourism businesses. There will be negligible cash inflows for most of the tourism businesses but the pressure on cash outflows will remain throughout the FY 2020-21,” FAITH said.
“This is once in a century crisis that has threatened the very existence of generations of tourism businesses in India,” it added.