New Delhi, Mar 19 :
Reeling under the impact of the coronavirus outbreak, the Federation of Associations in Indian Tourism & Hospitality (FAITH) has expressed its anguish at the state of affairs in a letter addressed to Prime Minister Narendra Modi.
“As a result of this pandemic, Indian tourism industry is looking at pan India bankruptcies, closure of businesses and mass unemployment,” FAITH said. An estimated 70 percent of the 5.5 crore people directly and undirectly employed in the tourism business (hotels, tourism companies, middlemen) could lose their jobs. The effect of job losses and layoffs has already begun throughout the country, the letter stated.
Various states have asked hotels to avoid hosting large gatherings leading to series of cancellations by corporates. Several private events and award functions have also been postponed or cancelled.
Hotels depend on food and beverage and events for 50 percent of the revenues. The other half is generated by revenues from rooms which has come down anywhere between 12-25 percent over the last few weeks.
“We request for a twelve months moratorium on our EMIs of principle and interest payments on loans and working capital from financial institutions. We also request for doubling of our working capital limits and on interest free and collateral free terms. This will prevent all our tourism businesses from going bankrupt. Sir we request you to set up a support fund for twelve months on the lines of MNREGA to support basic salaries with ‘direct transfer’ to affected tourism employees. Additionally to prevent insolvency, we request you for a deferment for 12 months of all statutory dues,” said Nakul Anand, Chairman of FAITH and executive director ITC.
Deferment of increase in any insurance premiums for 12 months, GST holiday for 12 months, withholding of tax collected at source on travel proposed in Finance Bill 2020, 200 percent weighted exemption for 12 months on expenses to Indian corporates to hold exhibitions, conferences and incentive trips in India, are some of the requests from the industry mentioned in the letter.
“Finally we request you to set up a national tourism task force of all relevant ministries of the Central Government along with ministry of tourism and chief secretaries of State governments and industry stakeholders to meet regularly to fast track all tourism investment approvals,” added Anand.
The total tourism business activity of India is estimated at $28 billion, including Rs 2 lakh crore in domestic tourism activity, as per estimates shared by FAITH.