Finance Minister Nirmala Sitharaman is set to table the Union Budget 2023-24 on February 1. Amid this, the stakeholders from the hospitality and tourism industry are expecting favourable announcements from the Minister to boost the industry.
The hospitality industry, which plays a significant role in the country's economy, includes hotels, restaurants, bars, clubs, motels etc. Last year, the industry was severely hit by the pandemic and faced a drastic drop in sales due to the lockdown and covid related curbs.
According to the previous year's Budget allocations, Finance Minister had announced a sum of Rs. 2,400 crore, 18.42 percent higher than the budget allocation of year 2021-22. However, the industry stakeholders were not much convinced with the budget announcements. They welcomed the extension of the Emergency Credit Line Guarantee Scheme (ECLGS), but were hoping for far more specific measures to be announced to provide relief to an industry, which was worst hit during the COVID-19 pandemic.
Building expectations on the previous year's announcements, the industry, this year, is expecting the Centre to make favourable announcements. The industry is anticipating announcements on funding, reintroduction of input tax credits and rebates in taxes along with a uniform GST on all hotels across the country.
Additionally, there are also expectations that the Centre should regulate prices of raw materials as the fluctuation and surge in prices of raw materials hampers the sale and affects business. The government must focus on the Infrastructure status of the industry to avail long-term loans from RBI, as well as make efforts to bring back skilled workers in the industry, who migrated during the lockdown, the industry experts suggest.
In a conversation with CNBC-TV18, Chander Baljee, CMD at Royal Orchid Hotels said, "The hospitality industry has bounced back like never before. I think these are the good times have come again, and so we are looking forward to a very, very great next few years."
Sarbendra Sarkar, Founder and MD, Cygnett Hotels & Resorts, said, "I anticipate that if the pandemic situation remains under control, 2023 will be a prosperous year for the tourism and hospitality sectors. The Union Budget 2023-2024 should introduce policies that incentivize new hotel openings, particularly in remote areas such as North East India. Additionally, a new tourism policy should be declared in the Union Budget, which has been long overdue. "
"The government should also promote the use of renewable energy resources in the hospitality sector, as India has committed to achieving net-zero emissions by 2070. Furthermore, the government's work in infrastructure, particularly in terms of road connectivity, is commendable and will help to boost weekend travel and domestic tourism further. To ensure the success of the hospitality industry, the Union Budget should also announce long-term loans and give the sector industry status, as it takes around 3-4 years to build a hotel," Sarkar said.
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Disclosure: SBI Life is the associate sponsor for this Budget coverage on CNBC-TV18.com
First Published: Jan 31, 2023 6:10 PM IST
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