A staff member prepares a room at the Dragonfly hotel in Mumbai. The Indian hotel sector has been hit extremely hard by the Covid-19 lockdown. Photo: Punit Paranjpe / AFP

The Indian government recently announced a stimulus package of 20 trillion rupees (US$263 billion) to revive various sectors of the economy after the slump caused by the Covid-19 lockdown. However, tourism sector representatives say there is nothing in the package for them.

The Federation of Associations in Indian Tourism and Hospitality says none of its concerns have been addressed by the government in its stimulus package, Press Trust of India reports.

“Indian tourism industry has gone into a state of disbelief and shock. It was looking forward to deep set of survival measures for tourism from the 20 trillion rupees package announced over five days, which however were not addressed,” the body said in a statement.

Even before the nationwide lockdown was announced on March 25, the industry was facing headwinds as international tourist flow was hampered by flight curbs imposed by various countries, and various Indian state governments had imposed travel restrictions to contain the spread of Covid-19. The recurring extensions to the lockdowns have only added to their pain. The consulting CEO of the organisation, Aashish Gupta, said the very survival of the industry is now at stake.

The body believes that international tourist inflow will continue to be affected due to flight restrictions. This will prevent foreigners from visiting the country and Indians settled or working abroad from visiting their friends and relatives in India, it said.

It was slightly more hopeful regarding domestic travel after the lockdown is lifted, but it said fear of the virus will likely discourage travel among elders and children. The new social distancing norms, corporate travel freeze and other factors will impact all leisure, adventure, heritage, spiritual, cruise and niche tourism segments, the statement pointed out.

To help ensure the survival of the sector, the Federation has proposed a dedicated interest- and collateral-free long-term fund for paying salaries and operating costs, as well as a complete fixed central and state statutory and banking liabilities waiver for a minimum of 12 months.

“With no visibility of cash inflows the Indian tourism industry is now looking at large-scale bankruptcies, business closures which will lead to job losses across cities, towns and hinterlands of India,” the body said.

Some members pointed out that the hospitality industry had helped the country fight the pandemic by offering hotel rooms to the government for accommodating the quarantined and providing free meals for people, including healthcare professionals, but they were ignored during the formulation of the relief package.

Last month another industry body, the Hotel Association of India, wrote to Finance Minister Nirmala Sitharaman seeking a relief package. It pointed out that the country’s travel and hospitality industry is staring at a revenue loss of 5 trillion rupees ($66 billion) over the next year while 35-40 million jobs, both direct and indirect, are in jeopardy.

Prominent players such as Oyo Hotel and Homes and many other hotel groups have taken various measures such as imposing pay cuts and laying off and furloughing employees as they face zero check-ins and empty rooms.

Restaurant owners say they are disappointed by the government’s failure to listen. The National Restaurant Association of India said in a statement that the industry needs support to survive. The association’s president, Anurag Katriar, said government neglect could lead to large-scale business closures and a massive loss of employment. It requested that the government “examine our requests closely and consider them favorably.”

The government has prohibited all domestic and international flights till May 31. Hotels, restaurants and other hospitality services will also remain shut, except those used for housing healthcare workers, stranded people and those under quarantine. Restaurants will be permitted to operate kitchens, but only for takeout.

Asia Times Financial is now live. Linking accurate news, insightful analysis and local knowledge with the ATF China Bond 50 Index, the world's first benchmark cross sector Chinese Bond Indices. Read ATF now.