Hotel Industry Skeptical About Government’s Home-stay Plans To
Promote Tourism
Mumbai: The Hotel and Restaurant Association of Western India
(HRAWI) has raised concerns over the Government’s plan to open up home-stays as
a way to bridge the acute deficiency of hotel rooms in the country for
promoting tourism. The proposal which may allow anyone to offer stays at their
homes will have no Government intervention and not attract any kind of taxation
or commercial tariffs. The hotel industry is skeptical about the outcome of
such a plan as it could backfire with no assurance of guest safety and would
have consequences that affect employment and tax revenues.
“In a country like India where
tourism is at a nascent stage promotion of home-stays at the expense of
organised hospitality could spell doom. The primary problem with home-stays is
that there are no standardization or categorizations. There have been multiple
cases of exaggerated promises, misrepresentations, disagreements and conflicts
with guests, hygiene issues and intimidation among others. Because home-stays are unregulated, there are no redressal systems in place,” says Mr. Bharat
Malkani, President, HRAWI & Federation of Hotels and Restaurants
Association of India (FHRAI). “Hotels are required by law to send details of
foreign guests to the police station by submission of a C Form. This is a
security requirement from the Ministry of Home Affairs. Home-stays are not
required to be compliant and the industry fears that this will become the de facto
accommodation for those foreigners that seek anonymity from the Police,” he
adds.
HRAWI also questioned the relevance
of subjecting hotels to administrative clearances, liquor permits and other
licenses while home stays providing the very same services are exempted.
Homestays, functioning just like hotels do, are prevalent even today in a lot
of states. However, they are unorganized and are presently limited in numbers.
With the Government’s new shift in policy focusing on homestays, the dynamics
are expected to change.
“The hospitality industry without home-stays in Maharashtra today can generate almost Rs. 600 crores per extra night that a foreign tourist stays back to the Government as foreign exchange
earnings, besides being the highest employment generator. Almost all tourist
towns across the world have grown on the back of strong hospitality
infrastructure and not home-stays, which are brought in only as a stop gap emergency
measure, as Delhi did during the Asian games, due to the three year gestation
period to add new hotel rooms. The solution to growth of tourism in India is
freeing the hospitality sector from red tapism and following a pragmatic
taxation policy,” says Mr. Kamlesh Barot, past President, HRAWI.
“If the home-stays concept does go
into execution then hotels that are presently operating with the highest taxation applicable in addition to paying for utilities such as water and
electricity at commercial rates are bound to be doomed. Tourism cannot afford
to run or prosper without hotels and the Government will have to consider an
alternate plan that can either allow hotels to operate with the same
relaxations as would be given to homestays or vice versa,” concludes Mr. Malkani.
About Hotel &
Restaurant Association Western India (HRAWI)
The Hotel and Restaurant
Association (Western India) is a 66 years old Association of Hotels and
Restaurants in Western India. Its members include smaller Hotels up to 5-Star
Deluxe categories. The bulk of its members like any growth economy are made up of
budget hotels. With around 1300 members across Western India, HRAWI covers
Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, Goa and the Union
Territories of Daman, Diu & Silvassa, and is considered to be the voice of
the Hotel Industry. The association is part of the national body of Federation
of the Hotels & Restaurants Associations of India (FHRAI), located in New
Delhi, which was originally founded in Mumbai in 1950 by the late Mr. J.R.D.
Tata.
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