The Federation of Hotel and Restaurant Associations of India (FHRAI), which also includes MSMEs and other companies, has again issued a statement to the Secretary of the Treasury, Nirmala Sitharaman, requesting her intervention to support the loan guarantee program of 60 billion announced this year in June. The association had also asked Nirmala Sitharaman to take note of the project report. The 6.29 lakh crore rupees financial aid plan announced in June this year to recover from the second wave of Covid also included a 1.1 lakh crore loan guarantee program for sectors affected by Covid.
Under this program, 50 billion rupees went to the health sector and 60 billion rupees to other sectors, including tourism, according to the government statement. “Almost five months after the announcement, the hotel industry is still awaiting notification from the government, despite the announcement of the same program for the health and tourism sectors,” FHRAI said. The federal government urged the finance minister to take urgent measures to report the system with a 100% state guarantee and long-term payment options.
“The ministry has not yet released any operational guidance or other details of the program. The health sector loan guarantee program, which was launched at the same time, was immediately informed and the NCGTC introduced the necessary guidelines. More recently, the Covid-Affected Tourism Services Sector Loan Guarantee Program (LGSCATSS) was also reported for the travel industry. It is as if the hotel industry is being deliberately neglected. This is the third time we have reminded the Secretary of the Treasury to take urgent action to report on the project, ”said Gurbaxish Singh Kohli, Vice President of FHRAI.
A January 2021 study by the National Council for Applied Economic Research (NCAER) on economic losses for households involved in tourism and economic policy found that 14.5 million jobs are expected to be lost in tourism in the first quarter of 2020, followed by 5.2 million jobs lost. in the 2nd quarter and 1.8 million jobs in the 3rd quarter. The data was shared by Tourism Minister G. Kishan Reddy in Lok Sabha in July this year. Additionally, the tourism sector dominated by MSMEs saw a 120 basis point drop to 4.7% in 2020 from 6.9% in 2019 thanks to the impact of Covid, SBI Research said in a statement. Report published in June this year, citing data from the World Travel and Tourism Council.