In the wake of the Supreme Court’s liquor ban on restaurants and hotels located in close proximity to National or State highways, the Federation of Associations in Indian Tourism and Hospitality (FAITH) on Wednesday said that establishments approved in the tourism category primarily exist for lodging, conferences and dining out experience, adding that none of these promote liquor consumption outside their premises.

Expressing concern over losing business, FAITH also said that meeting, incentives, conferencing, exhibitions (MICE) and wedding at hotels was combined with food, beverage and entertainment experiences. “India has less than an estimated 0.5 per cent of the world share of this sub-sector of tourism which will see large-scale cancellations. That has already started happening. Tourists will increasingly prefer travelling out of India for such events leading to a major outflow of foreign exchange,” it added.

Referring to the Prime Minister’s recent comments in Jammu & Kashmir that youth need to choose “tourism over terrorism”, the industry body pointed out that the hospitality industry employs five crore people directly and impacts the lives of 20 crore families indirectly.

“Almost nine million tourists visit India, resulting in almost 27 million foreign visitations across Indian states. These, along with 1.8 billion domestic visitations, frequent a significant portion of these 'establishments' as guests. All of this will be put to risk, if the overall food & beverage experience is compromised at such legitimate establishments that pay direct and indirect taxes and levies to both the Central and State governments,” it said in a statement.

Nakul Anand, Chairman, FAITH, said as the nodal body representing the tourism industry, FAITH was reviewing the way forward with key stakeholders.

The tourism body pointed out that most of the entrepreneurs, who bid as part of the public-private partnership projects along national and state highways have modelled their cash inflows on food and beverage revenues. The reduction in business will also result in distressed financial assets and may lead to a large-scale bad loan situation for the banking and financial system and severely impact the investment climate in tourism and hospitality.

“The US gets around 2 billion domestic tourism implying eight trips per citizen and 70 million foreign tourists. India gets 1.1 domestic tourism visits per citizen and just nine million tourists. Indian tourism’s hopes of highways-driven tourism model will come to a standstill and will regress Indian tourism if such 'establishments' will cease to be tourism venues,” it added.

FAITH said it supports any move that backs responsible driving, but requested that on a retrospective basis any damaging impact on investments in fixed capital assets and on large scale employment should be re-considered.

Related Topics