Snubbed & shaken: India’s hospitality industry stares at an uncertain future
The Federation of Hotels and Restaurants Association of India (FHRAI) has said that the industry is decidedly looking at a major catastrophe including massive job loss, bankrupt enterprises, and definite closure of at least 70 per cent of hospitality establishments across the country.
The writing was on the wall. After Finance Minister Nirmala Sitharaman’s announcement of the fifth and final tranche of the economic stimulus package saw no mention of the tourism and hospitality industry, stakeholders of the sector knew that the path to normalcy was going to be a tough one to walk on. And one, which in all probability, they will have to carve on their own.
On May 18, the Federation of Hotels and Restaurants Association of India (FHRAI) said that the Central government snub would cost them dearly, estimating that within the next month-and-a-half, over 70% of hotels and restaurants in the country would have to shut.
FHRAI said: “The industry is decidedly looking at a major catastrophe including massive job loss, bankrupt enterprises, and definite closure of at least 70 per cent of hospitality establishments across the country.”
The exclusion of the tourism and hospitality industry from the stimulus is a huge speed bump on the government’s path towards economic revival, said industry insiders, flabbergasted at why they had been left to pick themselves out of the abyss with no help whatsoever.
“The entire industry is confused, hysterical and in disbelief after listening to the FM’s speech. There was no mention of hospitality and tourism at all,” said Gurbaxish Singh Kohli, Vice President, FHRAI.
He added that the hospitality and tourism industry contributes 10% of the GDP, with a turnover of Rs 17 crore and providing jobs to over 4.3 crore people. Hence, the complete lack of mention was shocking and disappointing.
The fears are not unfounded with the COVID-19 pandemic beginning to leave indelible scars on the hospitality industry and its allied services. Food delivery player Zomato let go of 13% of its staff, which translates to 520 employees. Swiggy, its competitor, followed suit and laid off over 1,100 employees.
With no cash inflow, travel plans on the backburner, and the present migrant exodus, industry experts say that revival of the industry seems like a distant dream, at least until mid-2021. Various surveys and studies suggest that while citizens across Indian may be tired of being confined to their homes, they are not all that enthusiastic about travelling either.
While this comes as no surprise, the knowledge of the impending doom does little to assuage the simmering tensions.
According to Thomas Cook (India) Ltd and SOTC Travel, only 14% of Indians plan to travel in 2020, while 45% of the respondents have deferred all their travel plans to 2021.
The survey, Holiday Readiness Report, surveyed over 2,500 consumers across India’s metros and tier 1 & 2 cities. However, there is a silver lining, albeit a distant one.
The survey also indicated that domestic travel would take centre stage in the country, in the coming months. And this is what the industry is also placing its bets on. Akshita M Bhanj Deo, Director of The Belgadia Palace, said: “Given how the pandemic has created both physical and economic duress, the first thought on travellers’ minds will be proximity and low-cost safe travel.” (IANS)
With stakeholders keeping their fingers crossed over the government’s ability to flatten the COVID-19 curve, the atithi devo bhava (the guest is god) narrative seems to have gained a whole new meaning in the hospitality industry.