Tourism industry seeks grants as FM announces industry loan guarantee program


The tourism industry has requested a financial subsidy as the Union government on Monday announced financial support in the form of loans to more than 11,000 registered tour guides / travel actors who suffered losses due to the covid-19 pandemic. Finance Minister Nirmala Sitharaman announced that under the new loan guarantee program for sectors affected by covid, working capital / personal loans will be provided to tour guides and travel and tourism stakeholders ( TTS) in the tourism sector.

The program, which will be administered by the Ministry of Tourism, will cover 10,700 regional-level tour guides recognized by the Ministry of Tourism and tour guides recognized by state governments. Around 904 travel and tourism players (TTK) recognized by the Ministry of Tourism will also benefit from this system.

TTS (per branch) will be eligible to obtain loans up to 10 lakh while tour guides will be eligible for 1 lakh of capital which will come with a 100% guarantee. There will be no processing fee and additional warranty required. The government has also granted an exemption from prepayment charges levied on loans.

While industry associations hailed the intention behind the support, they underscored the urgent need for grants to support employees and manage losses incurred due to the pandemic.

“The amount of support to tourism service providers should be increased and commensurate with the size of their business and, since they are administered by the Ministry of Tourism and guaranteed by the NCGTC, they should be reclassified as emergency grants in pandemic event and not as loans to support working capital. for salaries and operations, ”said Aashish Gupta, consultant CEO, The Federation of Associations in Indian Tourism & Hospitality (FAITH).

There is an immediate need to waive the statutory obligations of fixed central and state commitments for tourism, travel and hospitality, FAITH said.

The Indian Association of Tour Operators (IATO), which represents more than 1,600 operators for inbound tourists, urged the government to consider providing a one-time financial subsidy to all recognized tour operators, which could represent 50% of wages paid. by tour operators in 2019 -20 and Rs. 2.5 lakh to each tour guide recognized by the tourism ministry / state government.

“We are currently on oxygen support and the grant would prevent us from being put on a ventilator,” said Rajiv Mehra, President of IATO,

MP Bezbaruah, Secretary General of the Hotel Association of India (HAI), said: “We sincerely hope that such steps will be logically followed by steps to revive the industry and be ready to welcome tourists. Measures such as liquidity support and exemption from statutory taxes. “

The industry unequivocally welcomed the government’s decision to provide free visas to the first five lakh foreign visitors once the visa issuance process begins. Some have suggested that this program should be extended until 2023/24 or until at least all pre-pandemic tourism activities are restored.

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