COVID-19 Crisis: Odisha Hospitality Industry Seeks Bailout Package, Govt Yet To Respond

The hospitality sector in Odisha, like elsewhere in the world, has received a major blow owing to the COVID-19 outbreak, forcing hoteliers, restaurant owners and tour & travel professionals to search for ways to keep their businesses afloat. In this series, Odisha Bytes takes a look at the state-of-affairs and the road ahead

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Bhubaneswar: The Hotel and Restaurant Association of Odisha’s (HRAO) demand for a stimulus package for the distressed industry has not received any response from the government despite several reminders.

The industry has received a moratorium from the Reserve Bank of India (RBI) to defer payment of loan installments for a period of three months. However, given the losses the industry has suffered and the time it will take to bounce back post the pandemic, the hoteliers have demanded an extended moratorium.

Among the foremost demands, “the industry seeks a minimum 12-month moratorium on all working capital, principal, interest payments, loans, and overdrafts. Besides this, it requires collateral & interest-free loan upto 5 years for SMEs in tourism,” as discussed in the webinar on ‘Tourism Insights and Strategies to the COVID-19 Crisis’ by CII on May 1.

Moreover, a complete GST tax holiday and waiver of fees for any upcoming licenses/permits renewal for the hospitality and travel industry across the state have also been demanded by the industry stalwarts.

“At present, we are in the survival stage. We are the first ones to be affected and will be the last ones to be allowed to operate. Since cash flow is a challenge, a bailout package is the need of the hour. I am sure we will bounce back with support from the government,” said Executive Director, Mayfair Hotels & Resorts Ltd, Souvagya Mohapatra.

Despite facing a severe crisis, the hotel industry has not laid off any of its staff members at present but is facing difficulties in paying salaries. “We are incurring about Rs 1 -2 crore losses per month due to the lockdown. With the operations  on halt, paying for bar charges, electricity fee, groundwater fee, and other licenses do not make any sense,” said General Manager, Hotel Marrion, Sameer Ali.

Attending the webinar, Minister of Tourism and Culture of Odisha, Jyoti Prakash Panigrahi ensured that the Department of Tourism and Culture is working very closely with the Central government in planning a growth and revival plan for the hospitality industry, which will be released soon.

HRAO first wrote to Prime Minister Narendra Modi on March 18 seeking financial assistance for the travel trade and hospitality industry followed by several reminders to the state and the Central governments.

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