The Federation of Associations in Indian Tourism & Hospitality (FAITH) has again requested multiple Ministries of Government of India, RBI and Niti Aayog for structured fiscal & monetary support to the tourism, travel & hospitality industry.
FAITH has quoted the Systemic Risk Survey carried out by RBI which has been presented in their Financial Stability Report, July 2020. In these five sectors have been identified which are most affected by the COVID-19 pandemic. Within them further, tourism and hospitality sector is the one which is most affected where 90 per cvent of the respondents foresee a bleak business scenario for at least the next six months.
FAITH has also quoted the feedback from collections data of GST and IT from Q1 that too demonstrate that the hospitality and tourism sectors are among the most facing difficulty. This implies that almost 75 per cent of the FY 2020-21 business of Indian Tourism, travel & hospitality will get compromised till a mass vaccine is available.
FAITH has requested from the Ministry of Finance complete fiscal and statutory support. They have requested for a Tourism COVID 19 fund which enables tourism businesses to support their employees and their operating costs. They have requested prioritised access to very low-cost funds for tourism which are much closer to the repo rate made available through a process of direct benefit transfer mechanism from Ministry of Finance. Additionally, considering the scenario of negligible cash flows for tourism industry, they have requested a consideration of waiver of statutory payment obligations for the FY 20-21.
FAITH has also requested RBI to consider urgently a tourism sector specific economic & monetary package which considers relief through multi-year moratorium for both principle & interest and a access to very low cost funds closer to the repo rate. They have also request RBI to consider a restructuring package for tourism, travel & hospitality industry.
FAITH urged the Ministry of Commerce to help with enabling SEIS credit to be made available to tourism industry against the foreign exchange earnings. They have also requested that at this time of crisis and business re-building for the tourism industry the SEIS rate should be pegged at 10% for both tour operators and hotels category and should be made applicable on gross foreign exchange earnings. To provide cash flow support and policy continuity they have requested it may be made available for FY 2019-20 and also for the policy period of the FTP 2020-25 with a provision of an additional 500 basis points increase during lean tourism period to stimulate enhanced foreign exchange earnings.
FAITH has requested Ministry of Civil Aviation to help with a robust policy mechanism to ensure cash refunds to travel agents and tour operators from both domestic and foreign airlines. Majority of travel intermediaries are MSMEs and with their cash flows blocked they are undergoing an unprecedented crisis of existence and confidence from both customers and employees.
Faith had also earlier requested the Chief Ministers of all states & the Member of Parliament of both the houses individually for their support with the above. FAITH has requested Niti Aayog for help with all of these points and with the other ministries of Government of India & with State Governments.
Internationally countries are stepping in to support the Tourism, Travel & Hospitality sector. In UK, Government has reduced VAT on restaurants by 75 per cent to encourage dining and is also subsidising 50 per cent of the food bill. In Japan financial support is being extended to the sector for their lost income during lock down. Even in EU, under the SURE program, tourism enterprises have access to funding to save jobs through a corpus and also give access to vouchers to consumers to support their preferred tourism service providers. In Singapore, the government has supported the Tourism industry with funding for rent, taxes and salaries.
FAITH has also urgently requested Ministry of Tourism for help with the other ministries of Government of India & with State Governments on these points. They have also requested them ensuring travel agents & tour operators for getting back cash refunds from airlines, railways & state national parks.
To fast track revival of tourism interest, FAITH has also requested Ministry of Tourism to request their creative agency to suggest ideas which elegantly communicate positivity & safety of Indian tourism while weaving these messages around different product segments, destinations and incredible concepts of Indian tourism. These could be designed as multiple series of 30 seconder social media ads each with different versions of voice over of maybe 5-7 Indian and international languages to help stimulate both domestic & international tourism traffic as soon as external conditions permit.