Karnataka gives industry status to hotels in tourism sector

The state government has decided to accord industry status to the hotel business, Tourism Minister C P Yogeeshwara said on Saturday.

With this, hotels in the tourism sector will enjoy subsidies and levies applicable for industries. Earlier, hotels were considered as commercial establishments and not industrial units.

Yogeeshwara said the move, approved by the Cabinet, will provide a boost to the Covid-hit tourism sector. “The pandemic wreaked havoc on the sector. Establishments that depended on tourism took a big hit. There’s a need to rejuvenate them,” he said.

“Hotels were being set up on commercial rates. Now that they will be considered as an industry, the taxes and other levies will be reduced,” he said, adding that 62 hotels that have star classification will come under this to begin with. “Small-scale hotels will not come under this. We’re planning to come out with a separate scheme for them.”

According to Additional Chief Secretary (Tourism) T K Anil Kumar, only 62 hotels in Karnataka have star classification from the Ministry of Tourism. “The subsidies and other benefits for these hotels will be applicable for a five-year period starting April 2021,” he said.

Yogeeshwara said that Karnataka has about 1,000 2-star hotels. “The classification of hotels from 1-star to 5-star is done through a committee of the central government,” he said. “The state-run Mayura hotels have applied for star classification.”

Classifying the hotel business as an industry was a long-pending demand that intensified during the pandemic. “This is a step in the direction of developing the tourism sector as Karnataka is still lagging behind states such as Kerala and Gujarat,” Yogeeshwara said.

Asked about the development of Nandi Hills near Bengaluru, the minister said it was only recently that the Horticulture Department handed over the management of the popular spot to the Tourism Department. “We are planning to have cable cars and other amenities. There’s scope for private investment as well,” he said.

Apart from Nandi Hills, Yogeeshwara said other popular tourist destinations such as Jog Falls, Kodachadri and Kemmanugundi will be developed. “Plans are getting ready to develop Badami and Pattadakal as heritage tourist sites. Also, action is being taken to develop the Roerich and Devikarani Estate as a cultural centre,” he said.