WORLD Travel & Tourism Council (WTTC) has called on the Indian government to adopt more liberal visa rules to attract more tourists to fill hotels, as the hospitality sector braces for stagnating occupancy with an expected influx of rooms in the next two years.
Speaking at the fifth Hotel Investment Forum India, which was held at Leela Kempinski Gurgaon from January 14-15, WTTC president and CEO, David Scowsill, said: “Even though India has tried to liberalise its visa procedure in terms of expanding the visa on arrival facility to more countries and doing away with a two-month gap restriction between re-entries to the country, India needs to continue the process of providing the facility to more countries and make the process faster and electronic.”
Kapil Chopra, executive vice president, The Oberoi Group, agreed: “We need a paradigm shift in the number of tourists coming to this country. A top-level CEO told me that it took him eight working days to get a visa to India – that’s why we lag behind countries like Thailand and Hong Kong which offer visa on arrival to so many countries.”
He added: “Our occupancies have become stagnant. I don’t see it rising in the near future, as a lot of new hotels are coming up and demand is not increasing.”
“With 30,000-35,000 rooms opening in the next two to three years, there is a likelihood that most hotels will feel the pain as average room rates will be pressurised. We expect a nominal increase of five per cent in average room rates in cities such as Delhi, Mumbai and Bangalore where a lot of new hotels are emerging. I think it is going to be tough especially for any hotel that opens in the next two years,” said Rajiv Kaul, president of Hotel Leelaventure.
“The problem is that new rooms are coming up but the customer base is not matching growth. I see consolidation happening in the Indian market and the unstructured market will shrink as a result,” added Anil Madhok, managing director, Sarovar Hotels.
According to a report by STR Global, occupancy in Indian hotels stood at 58.1 per cent in 2012 versus 59.3 per cent in 2011.