Hospitality Sector Laments Missed Opportunities in Budget 2024-25

The hospitality industry has expressed disappointment with India's Budget 2024-25, citing a lack of support for policy reforms and infrastructure status. Leaders from various associations highlighted unaddressed needs but welcomed initiatives in spiritual tourism and simplified taxation for cruise operations.

Hospitality players on Tuesday expressed disappointment with the Budget for 2024-25, citing a lack of policy announcements to facilitate the development of the sector.

They lamented that some key demands to revitalize the tourism and hospitality sector, such as granting infrastructure status and easing business regulations, were not considered.

The Hotel Association of India (HAI) President KB Kachru emphasized the tourism and hospitality sector's crucial role in the Indian economy. He noted that while government spending on infrastructure development is beneficial, no specific policy announcements were made to foster hotel development or promote inbound tourism.

Echoing similar sentiments, Federation of Hotel and Restaurant Associations of India's (FHRAI) Pradeep Shetty said the hospitality sector had high hopes from the Union Budget for 2024-25, given the government's vision of a 'Viksit Bharat' by 2047 and tourism's vital role in achieving it. However, the budget did not offer significant structural changes to address fundamental challenges and accelerate sector growth towards a USD 3 trillion economy by 2047.

Radisson Hotel Group's Nikhil Sharma welcomed the budget's recognition of spiritual tourism and road connectivity projects, viewing them as positive steps to enhance the country's cultural and spiritual tourism network.

Travel distribution firm ixigo's Chairman and CEO, Aloke Bajpai, praised the government's initiatives to boost spiritual tourism as a move that would grow domestic tourism and position India as a global travel destination. He anticipates significant gains in areas like Bihar and Odisha with the development of spiritual corridors.

Despite these positives, experts highlighted gaps that could hinder growth and recovery in the travel and tourism sector. Apex travel agents body TAAI criticized the budget for not launching robust campaigns to boost domestic tourism, which is increasingly essential in the global context.

Deloitte India's Rajat Mahajan acknowledged that initiatives to develop religious sites would boost the local economy, while EaseMyTrip co-founder Rikant Pittie noted the government's interest in simplifying taxation for the cruise business to encourage foreign operators. These steps aim to significantly boost cruise tourism.

According to CRISIL's Pushan Sharma, the anticipated simpler tax regime for foreign cruise companies is expected to increase annual cruise passenger traffic and operational cruise terminals, showcasing India's rich heritage.

(With inputs from agencies.)