Hospitality industry welcomes Budget 2026-27; disappointed over no infra status

The hospitality industry welcomed the Union Budget 2026-27 on Sunday but expressed disappointment that its long-pending demand for comprehensive infrastructure status was not met. The President of Hotel Association of India (HAI) and Chairman, South Asia, Radisson Hotel Group, K B Kachru, said, Budget 2026-27 reflects a strong focus on accelerating and sustaining economic growth, with a decisive push on infrastructure, both critical drivers for the tourism sector, where growth is closely linked to these factors. The Budget's proposals, including the National Institute of Hospitality, aim to strengthen industry-aligned skilling, research, and leadership development, he said adding that infrastructure growth in tier II-III cities, the East Coast Tourism Corridor, and importantly focus on medical-value tourism, are expected to boost hotel viability, diversify India's offerings, and enhance global competitiveness. Despite the Budget's positive thrust, a long-standing aspiration of the sector, comprehensive infrastructure recognition, remains unmet, he said. Chalet Hotels MD and CEO Shwetank Singh said the Union Budget represents a significant commitment to elevating India's tourism and hospitality ecosystem, and the industry is encouraged by the Finance Minister's comprehensive vision for the sector. He said that the upgrade of NCHMCT into a National Institute of Hospitality is transformative, and it will create a world-class talent pipeline that bridges industry needs with academic excellence, directly addressing the skilled manpower requirements for expanding the sector. The national digital destination registry and upgrade of 15 archaeological sites into cultural destinations demonstrate a sophisticated understanding of experiential tourism infrastructure, and these initiatives, combined with ecologically sustainable mountain trail development, position India to capture diverse tourism segments from heritage to adventure to wellness, Singh said. ''However, our long standing ask to grant comprehensive infrastructure status to the sector continues to remain a distant dream,'' he added. Radisson Hotel Group Managing Director and COO, South Asia, Nikhil Sharma said, ''The renewed focus on strengthening last-mile infrastructure, expanding rail connectivity, and promoting destination-led tourism beyond major metropolitan centres creates a strong foundation for expanding tourism into new growth markets.'' The focus on sustainable and experiential tourism, including the development of Himalayan trails, the continued push for Buddhist circuits, and the strong policy thrust on the Northeast, will support the growth of diverse tourism segments while enabling more balanced regional development, he said adding that these measures are expected to encourage longer stays, wider travel dispersal, and stronger demand for quality accommodation and services across tier II and III markets. Pranav Rungta, Co-Founder and Director, Nksha Restaurant and Vice President, NRAI Mumbai, said, this Budget is a positive step for India's hospitality sector. Announcements like the first-ever National Institute of Hospitality and structured skill development for tourist guides will strengthen service standards and prepare our workforce to meet growing domestic and international demand, he said. ''At the same time, restaurants continue to face structural challenges such as GST on commercial leases, access to export incentives like SEIS and easier SME support. Addressing these challenges alongside rising tourism and dining demand is key to building a resilient, sustainable and globally competitive hospitality sector,'' added Rungta. Sterling Holiday Resorts Managing Director and CEO Vikram Lalvani said the Union Budget reflects a clear thematic shift in India's tourism agenda from destinations to purpose-led journeys positioning the sector as a multi-dimensional engine anchored in wellness and healing, spiritual and cultural circuits, nature and conservation-led travel, adventure and mountain ecosystems, and stronger regional connectivity that enables exploration beyond metros. ''Initiatives spanning Buddhist circuits, sustainable Himalayan hiking trails, medical and wellness tourism, Ayurveda, heritage-led travel, and conservation-linked trails such as Odisha's turtle nesting corridors together create the right ecosystem for responsible growth where communities, travellers and destinations all benefit,'' he noted. ICRA Senior Vice President and Group Head, Corporate Ratings, Jitin Makkar said, ''Development of several heritage and cultural sites, including 15 new archaeological sites, hosting the first-ever Global Big Cat Summit, continued focus on medical tourism, and mountain trains to specific states in hill stations are likely to boost the demand for domestic hospitality sector while also attracting foreign tourists.'' While the reduction in TCS on international tour programme makes international travel cheaper, this is unlikely to materially substitute the domestic demand.'' TeamLease Degree Apprenticeship CEO Dr Nipun Sharma the proposal to establish a National Institute of Hospitality is a timely step toward strengthening one of India's most employment-intensive sectors. ''India's hospitality capacity is scaling rapidly, with an estimated 2.48 million lodging rooms operational as of June 2024, projected to rise to 3.1 million by 2029 and 4.1 million by 2034. This expansion will drive significant demand for skilled talent across operations, service delivery, and management,'' she said. Jaypee Hotel and Resorts Managing Director Manju Sharma said, the Union Budget clearly recognises tourism and hospitality as key drivers of employment, foreign exchange, and regional growth. ''The pilot upskilling programme for tourist guides is a timely move towards delivering consistent, high-quality experiences at India's most iconic destinations,'' she said. For experience-led hospitality groups such as Jaypee Hotels & Resorts, these measures will support deeper destination development, higher service standards, and more immersive guest experiences - reinforcing India's position as a globally competitive tourism destination, she added.

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