Covid-19 impact : 40% of tourism companies in India may close down permanently

0
61
Source- BW Disrupt

Aviation, tourism, and hospitality sectors together employ 50 million people directly or indirectly.

The situation is getting worse for the travel and tourism industry in India with each passing day. COVID-19 has impacted their business profoundly, pushing them into a dark space. 

Over 80% of the companies have lost their entire revenue to the coronavirus pandemic, whereas about 15% have managed to earn just 25% of it. The industry expects about 40% of the travel firms to shut down permanently in the next 3-6 months in the worst-case scenario. 

The survey conducted with 2300 stakeholders from the tourism industry revealed that,  after the announcement of 21 lakh crore relief package by the government, 73% of travel companies have deferred salaries, terminated contracts while 67% have cut overheads and a little less than 50% of the surveyed firms deferred capital expenditure.

The BOTT Travel Sentiment Tracker survey conducted in collaboration with seven national associations including the Indian Association of Tour Operators (IATO), Travel Agents Association of India (TAAI), Association of Domestic Tour Operators of India (ADTOI) indicated that industry stands at stakes even after the domestic flights resume. 

Ashish Gupta, CEO of The Federation of Association Indian Tourism and Hospitality (FAITH) said that they have been in constant touch with the Prime Minister, Minister of finance, commerce, aviation, tourism, Niti Ayog, RBI and chief ministers of all 28 states regarding the upliftment of the tourism industry. 

The Federation of Associations in Indian Tourism & Hospitality (FAITH), the body representing tourism, travel, and hospitality industries, said that it had proposed an interest and collateral-free long-term fund for paying salaries and operating costs along with a complete 12 months waiver from fixed central and state statutory. It had also ideated a waiver from banking liabilities without any penal and compounding interests. However, they are still awaiting an answer from the authorities but the announcement of a 6 months moratorium by RBI is a relief in this tense situation. 

The survey also depicted that 79% of firms are expecting the government to create a tourism relief fund immediately, 68% of them also want GST rates lowered by 5%.

LEAVE A REPLY

Please enter your comment!
Please enter your name here