India’s tourism, hospitality and retail sectors have expressed disappointment and panic over their exclusion from finance minister, Nirmala Sitharaman’s economic relief packages. With no financial support, these segments foresee a grim future.
India’s tourism industry may witness huge bankruptcy and business closures. No cash inflow is expected for several quarters over FY 20-21 as the key segments of the tourism economy will be down.
The international inbound tourism and VFR (visiting friends and relatives) and outbound travel will remain inactive owing to international flight ban. Domestic leisure and business travel will also be impacted due to restrictions.
As a rescue measure, Federation of Associations in Indian Tourism and Hospitality (FAITH) had proposed “a dedicated interest and collateral-free long term fund for paying salaries and operating costs and for a minimum of 12 months of complete waiver of fixed central and state statutory and banking liabilities without any penal or compounding interest” which were not addressed.
At least 70 per cent of hospitality establishments across India are preparing for the closure.
Elaborating on this, Gurbaxish Singh Kohli, vice president, Federation of Hotel and Restaurant Associations of India (FHRAI) and president, Hotel and Restaurant Association of Western India (HRAWI) said, “Apprehension in people’s minds coupled with a weakened economy will make getting back on our feet without government intervention, impossible.
“Migrants constitute approximately 65 per cent of the hotel industry’s employment and roughly 60 per cent of hotels in the country are in the economy or mid-market segments. With migrants making their way back home, if and when we do resume business, we won’t have the same kind of manpower we had. Our projections indicate that within the next 30 to 45 days as many as 70 per cent of hotels and restaurants put together will close down. The FHRAI calls upon the government for its urgent attention and pleads to bail us from this eventuality.”
Anurag Katriar, president of the National Restaurant Association of India (NRAI) that represents over five lakh food and beverage outlets expressed his concerns via tweet, “Respected PM Narendra Modi sir, the restaurants’ industry and millions of its workers have reached a sad conclusion today that we don’t matter for your government; we were not even worth a mention. We had much better expectations, sir.”
The restaurant industry has extensively contributed to social welfare since the first lockdown was implemented in India. Several restaurants volunteered for feeding the needy by preparing and distributing lakhs of meals for workers, colonies, doctors, health workers, and essential services staff, among others every day.
The retail industry, which contributes around 40 per cent to India’s consumption and 10 per cent to India’s gross domestic product, is severely stressed.
Retailers Association of India (RAI), an apex body of Retailers in India has also raised concerns.
According to the Press Trust of India, the retail industry body said that with “no income and zero support from the government”, retailers are staring at the closure of businesses that would jeopardise livelihoods and jobs of 46 million direct employees, out of which 20 million work in non-essential retail.
“The steps taken under the Atmanirbhar Bharat economic stimulus will help the country in the long term but the emergent issues facing the retail industry have not been addressed,” said RAI chief executive officer Kumar Rajagopalan.
“What retailers needed was wage support; moratorium for payment of principal and interests and support in the form of working capital. This is critical for retail to survive.” He added.
This is a developing story