The Federation of Associations in Indian Tourism and Hospitality (FAITH), has appealed to all Chief Ministers to come up with State-specific packages for the survival of the tourism and hospitality sectors reeling from the COVID-19 pandemic.
FAITH, a policy federation of 10 national associations representing the tourism, travel and hospitality industry in India, on Wednesday said that all 28 Indian States were set to lose tourism as an industry.
The Federation members said that foreign and domestic tourism in each State would be hit severely in 2020-2021. The travel trade estimated in the excess of 8 billion domestic tourism footfalls, over 10.5 million foreign tourists and 6 million plus non-resident Indian (NRI) tourist footfalls would be hit.
“Each foreign tourist has a multiplier effect of 2.8 times across Indian States, hence 10.5 million foreign tourists lead to over 28 million foreign tourists footfalls across states,” Jay Bhatia, vice-president, Travel Agents Association of India (TAAI), a FAITH member said.
In its appeal to the Chief Ministers, FAITH called for a complete waiver of all fixed electricity and other utility charges as well as excise duties without any penalties. It also appealed for renewal of all licenses, permits and permissions which were expiring in FY 2020-21 without any financial charges or penalties.
The States were also asked to refund for FY 2019-20, the State GST collected from all travel agents, tourist transporters, hotels, tour operators, restaurants and any other tourism, travel and hospitality enterprises which will help manage their working capital crisis and can be paid back in subsequent years interest-free and without any penalties.
It also called for a complete waiver of any other taxes, fees, cesses or levies such as property taxes or interstate tourist transport taxes levied at the level of the State, municipal, district or panchayat on the tourism, travel and hospitality industry.
As per an analysis by FAITH, the pandemic had jeopardised all top performing foreign source markets for tourism such as the U.S., Canada, U.K., Germany, China, Japan, Singapore, Russia, Italy and Spain.
In a statement, FAITH said the inter-State domestic season, which lost over 60% in the April-July period, had collapsed for the FY 2020-21.
Tourism business has almost completely come to a standstill, it is severely impacted and foreign tourists are not likely to travel before FY 2021-22, the statement by FAITH said, adding that the inter-State domestic season would be poor for the rest of year with stringent travel restrictions and reduced connectivity across States.
“FAITH has been repeatedly saying to all key government bodies that the tourism industry of India first needs to survive, then needs to revive and then only can it thrive,” the statement said.
Additionally, FAITH also requested the Chief Ministers for their support with the following — requesting the Union Finance Minister for a complete waiver of income taxes, GST, provident fund and employee State insurance and any other statutory taxes, fees, cesses or levies on the tourism, travel and hospitality industry for FY 2020-21.
FAITH also sought the help of the State governments in requesting the RBI Governor for increasing the moratorium period on loans from three months to the full financial year of 2020-21 without any penal or accumulated interest and prevailing upon the government of India to set up a Tourism COVID-19 fund for 10-year interest free loan for enabling the tourism, travel and hospitality industry to meet salary costs.
“This could be for a minimum fund size of ₹50,000 crore which is almost equal to the gross banking credit to Indian tourism, travel and hospitality industry. This will help retain jobs, ensure that tourism business don’t go bankrupt and also will protect the principal amount of loan and overall banking exposure,” FAITH said.
