To transform India’s hospitality sector, the Federation of Hotel & Restaurant Associations of India (FHRAI) has shared its expectations for the 2018 budget.
Regardless of the size of the city, FHRAI is suggesting that hotels with project costs of Rs 10 crores and above be awarded infrastructure status nationally. This action aims to eliminate regional prejudices and advance accessibility and growth within the hotel sector.
According to FHRAI, the industry would undergo a revolution if infrastructure status were granted, since it would enable long-term loans at affordable interest rates, thereby spurring expansion. The industry is also looking to the government for more stimulus packages and incentives to assist it reach its target of 100 million foreign visitors by 2047. These benefits include a tax framework that is advantageous and streamlined business processes for the hotel industry.
The President of FHRAI, Pradeep Shetty, underlined the significance of these changes, saying that they are essential to realizing India’s multifaceted potential and propelling the industry’s unparalleled expansion.
The pre-budget study from FHRAI emphasizes how the hotel industry’s expansion is impeded by the intricacy of approval procedures and compliance. The federation suggests implementing self-regulation, a single-window clearing system, and combining licenses and permissions to streamline these procedures.
Additionally, FHRAI emphasizes that to create a shared framework between the Center and States, tourism, travel, and hospitality must be included under the concurrent list. They contend that doing this will accelerate the growth of tourism across the country.
About 10% of India’s GDP comes from the travel and tourism industry. According to FHRAI, India can fully realize its potential for socioeconomic growth by designating tourism as a priority industry and providing unique incentives.
To increase India’s competitiveness abroad, FHRAI also demands that the GST rates in the hotel industry be reviewed and lowered. In particular, they suggest combining the higher-than-average 12% category with the 18% GST category for hotels over Rs 7,500.
The goals of the industry ahead of the 2024 Lok Sabha elections are highlighted in FHRAI’s suggestions, which Finance Minister Nirmala Sitharaman is set to submit on February 1st.
India’s hotel sector is predicted to increase from $24.61 billion in 2024 to $31.01 billion in 2029. A compound annual growth rate (CAGR) of 4.73% is anticipated to propel this increase between 2024 and 2029.
When compared to the same period in 2022, the Indian hospitality industry grew significantly in the third quarter of 2023. The average daily rate (ADR) increased by 15.6% year over year, which resulted in a 15.1% rise in revenue per available room (RevPAR), the primary driver of this development.
India’s hotel sector is predicted to increase from $24.61 billion in 2024 to $31.01 billion in 2029. A compound annual growth rate (CAGR) of 4.73% is anticipated to propel this increase between 2024 and 2029.
When compared to the same period in 2022, the Indian hospitality industry grew significantly in the third quarter of 2023. The average daily rate (ADR) increased by 15.6% year over year, which resulted in a 15.1% rise in revenue per available room (RevPAR), the primary driver of this development.
