· RBI survey indicates that tourism & hospitality
most stressed sectors
· Q1 GST & IT collections indicate tourism &
hospitality non-performing sectors
· Globally countries are stepping up support to
Tourism, Travel & Hospitality
Federation of Associations in Indian Tourism &
Hospitality, the policy federation of all the national associations
representing the complete tourism, travel and hospitality industry of
FAITH has over the week requested RBI, Ministry of
Finance, Ministry of Civil Aviation, Ministry of Commerce, Ministry of Tourism,
Niti Aayog for structured fiscal & monetary support to the tourism, travel
& hospitality industry.
FAITH has quoted the Systemic Risk Survey carried
out by RBI which has been presented in their Financial Stability Report, July
2020. In these five sectors have been identified which are most affected by the
COVID-19 pandemic. Within them further, tourism & hospitality sector is the
one which is most affected where 90% of the respondents foresee a bleak
business scenario for at least the next six months. FAITH has also quoted the
feedback from collections data of GST & IT from Q1 that too demonstrate
that the hospitality and tourism sectors are among the most facing difficulty.
This implies that almost 75% of the FY 2020-21 business of Indian
Tourism, travel & hospitality will get compromised till a mass vaccine is
available.
From the Ministry of Finance, FAITH has
requested complete fiscal & statutory support. They have requested
for a Tourism COVID 19 fund which enables tourism businesses to support their
employees and their operating costs. They have requested prioritised access to
very low-cost funds for tourism which are much closer to the repo rate made
available through a process of direct benefit transfer mechanism from Ministry
of Finance. Additionally considering the scenario of negligible cash flows for
tourism industry, they have requested a consideration of waiver of statutory
payment obligations for the FY 20-21.
FAITH has requested RBI to consider urgently a
tourism sector specific economic & monetary package which considers relief
through multi-year moratorium for both principle & interest and a access to
very low cost funds closer to the repo rate. They have also request RBI to
consider a restructuring package for tourism, travel & hospitality
industry.
From Ministry of Commerce, FAITH has requested help
with enabling SEIS credit to be made available to tourism industry against the
foreign exchange earnings. They have also requested that at this time of crisis
and business re-building for the tourism industry the SEIS rate should be
pegged at 10% for both tour operators and hotels category and should be made
applicable on gross foreign exchange earnings. To provide cash flow support and
policy continuity they have requested it may be made available for FY 2019-20
and also for the policy period of the FTP 2020-25 with a provision of an
additional 500 basis points increase during lean tourism period to stimulate
enhanced foreign exchange earnings.
FAITH has requested the Ministry of Civil Aviation
to help with a robust policy mechanism to ensure cash refunds to travel agents
& tour operators from both domestic and foreign airlines. Majority of
travel intermediaries are micro & small enterprises and with their cash
flows blocked they are undergoing an unprecedented crisis of existence and
confidence from both customers and employees.
Tourism connectivity has to be started in true
earnest. FAITH has also requested the Ministry of Civil Aviation to
expand air connectivity to Asia, Middle East & Africa, in addition to the
planned ones for
Faith had also earlier requested the Chief
Ministers of all states & the Member of Parliament of both the houses
individually for their support with the above. FAITH has requested Niti Aayog
for help with all of these points and with the other ministries of Government
of
Internationally countries are stepping in to
support the Tourism, Travel & Hospitality sector. In
FAITH has also urgently requested the Ministry of
Tourism for help with the other ministries of Government of
To fast track revival of tourism interest, FAITH
has also requested Ministry of Tourism to request their creative agency to
suggest ideas which elegantly communicate positivity & safety of Indian
tourism while weaving these messages around different product segments,
destinations and incredible concepts of Indian tourism. These could be designed
as multiple series of 30 seconder social media ads each with different versions
of voice over of maybe 5-7 Indian and international languages to help stimulate
both domestic & international tourism traffic as soon as external
conditions permit.
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 has said that these actions will help in
preventing further tourism business shutdowns and job losses. For the tourism
sector to survive and thereafter revive this structured support is most
critical from among all ministries of Central Government, State Governments,
Niti Aayog & the RBI. This is once in a century crisis that has threatened
the very existence of generations of tourism businesses in