<p>Hotels and restaurants in India are once again on the edge with fears of state-wide lockdowns and restrictions due to the rising number of Covid-19 cases.</p>.<p>In view of the possibility of a second pandemic wave, the Federation of Hotel & Restaurant Associations of India (FHRAI), the apex hospitality body, is seeking a sector-specific loan restructuring plan from the government.</p>.<p><strong>Read: <a href="https://www.deccanherald.com/national/indias-active-covid-19-caseload-falls-under-4-of-total-infections-stands-at-383-lakh-924838.html" target="_blank">India's active Covid-19 caseload falls under 4% of total infections, stands at 3.83 lakh</a></strong></p>.<p>The association has opined that loan extensions should be given to the hospitality sector on similar lines as those given under the prime minister’s scheme for loans below Rs 25 crore for SMEs and MSMEs. Provisioning this, the association has asserted, is the need of the hour for saving the hospitality industry from an almost imminent collapse.</p>.<p>“The hospitality and tourism sector of India is not a risk to the Indian banking system and it needs to be protected to prevent its assets from becoming non-performing. With existing travel restrictions, in February 2020, 1.01 million foreign tourists arrived in India compared to 1.08 million in February 2019, registering a year-on-year decrease of 6.6% already,” said Gurbaxish Singh Kohli, Vice President, FHRAI.</p>.<p>Since then, until date, there are no foreign tourist arrivals (FTAs) and are not expected anytime soon with fears of a second wave.</p>.<p>“The total value at risk to the entire economy is close to Rs 10 lakh crore with more than 50% job losses within the industry. There is a justifiable fear that most of the hospitality businesses companies in this industry would be unable to service their financial obligations and eventually slip into the most distressed category,” he said, seeking government’s help.</p>.<p>“Businesses are steadily closing and the NPAs are also rising. Conservative projections show estimated revenues of only Rs 36,400 crore against total revenue of Rs 1.82 lakh crore in FY 2019-20. This translates to a revenue loss of Rs 1.14 lakh crore. The total loan outstanding to the hospitality industry is Rs 55,000 crore and the value at risk for the hospitality and tourism sector is at approximately Rs 10 lakh crore without accounting for a second lockdown and its repercussions,” adds Pradeep Shetty, Joint Honorary Secretary, FHRAI.</p>
<p>Hotels and restaurants in India are once again on the edge with fears of state-wide lockdowns and restrictions due to the rising number of Covid-19 cases.</p>.<p>In view of the possibility of a second pandemic wave, the Federation of Hotel & Restaurant Associations of India (FHRAI), the apex hospitality body, is seeking a sector-specific loan restructuring plan from the government.</p>.<p><strong>Read: <a href="https://www.deccanherald.com/national/indias-active-covid-19-caseload-falls-under-4-of-total-infections-stands-at-383-lakh-924838.html" target="_blank">India's active Covid-19 caseload falls under 4% of total infections, stands at 3.83 lakh</a></strong></p>.<p>The association has opined that loan extensions should be given to the hospitality sector on similar lines as those given under the prime minister’s scheme for loans below Rs 25 crore for SMEs and MSMEs. Provisioning this, the association has asserted, is the need of the hour for saving the hospitality industry from an almost imminent collapse.</p>.<p>“The hospitality and tourism sector of India is not a risk to the Indian banking system and it needs to be protected to prevent its assets from becoming non-performing. With existing travel restrictions, in February 2020, 1.01 million foreign tourists arrived in India compared to 1.08 million in February 2019, registering a year-on-year decrease of 6.6% already,” said Gurbaxish Singh Kohli, Vice President, FHRAI.</p>.<p>Since then, until date, there are no foreign tourist arrivals (FTAs) and are not expected anytime soon with fears of a second wave.</p>.<p>“The total value at risk to the entire economy is close to Rs 10 lakh crore with more than 50% job losses within the industry. There is a justifiable fear that most of the hospitality businesses companies in this industry would be unable to service their financial obligations and eventually slip into the most distressed category,” he said, seeking government’s help.</p>.<p>“Businesses are steadily closing and the NPAs are also rising. Conservative projections show estimated revenues of only Rs 36,400 crore against total revenue of Rs 1.82 lakh crore in FY 2019-20. This translates to a revenue loss of Rs 1.14 lakh crore. The total loan outstanding to the hospitality industry is Rs 55,000 crore and the value at risk for the hospitality and tourism sector is at approximately Rs 10 lakh crore without accounting for a second lockdown and its repercussions,” adds Pradeep Shetty, Joint Honorary Secretary, FHRAI.</p>
