Top News India’s Union Budget disappoints tourism and hospitality players By Rohit Kaul / Posted on 3 February, 2022 17:53 India’s tourism and hospitality businesses are left high and dry by the central government’s budget for 2022-2023, which has neglected their requests for industry status, abolishment of tax collection at source (TCS) on outbound travel, and tax concessions. The only silver lining in a largely gloomy budget for the country’s battered tourism and hospitality industry is an extension of the Emergency Credit Line Guarantee Scheme (ECLGS) until 2023, with an additional 500 billion rupees (US$6.7 billion) dedicated to hospitality and allied businesses. Indian tourism and hospitality players had expected more financial assistance from the government’s budget 2022-2023; Gateway Of India, Mumbai pictured Launched as a special scheme in view of the Covid-19 crisis, ECLGS provides 100 per cent guarantee coverage to banks and non-bank financial companies (NBFCs) to enable them to extend emergency credit facilities to enterprises so that their additional working capital requirements are fulfilled. KB Kachru, vice president, Hotel Association of India (HAI), told TTG Asia that the distressed industry had expected more assistance from the government. “The budget offered a good opportunity to the government to roll out policy changes, like announcing industry status for the sector,” the veteran hotelier said. Jyoti Mayal, president of Travel Agents Association of India (TAAI), expressed his disappointment: “We were expecting the government to announce some measures to uplift the mood of travel trade stakeholders. No announcement was made to roll back TCS, which has made Indian travel agents less competitive in the international market. We were also expecting industry status for the tourism sector.” However, one stakeholder has jumped to the defence of budget 2022-2023. Naveen Kundu, managing director, EbixCash Travel Services – India, South East Asia & Middle East, explained: “We cannot just view this budget from the lens of the tourism sector. As an overall budget, there are both direct and indirect benefits to the sector. “The direct benefit is in form of the ECGLS extension with an additional (financial injection). It is a great step in terms of creating and restructuring loans for the hospitality sector.” Kundu added that the government’s plans to invest in various infrastructure projects, such as construction of roads, railways, airports, ports, mass transport, waterways and logistics, will help “domestic and inbound tourism to grow”. “Just imagine the amount of capital that will flow into the capital goods industry and the manufacturing industry. Such investments in new projects will also fuel the demand for travel,” he said. Kundu said the government could also consider declaring 2022 as a Visit India year, offering free visas to inbound tourists.