Government Asks Hotels to Cut Room Tariffs To Encourage Tourism

Government Asks Hotels to Cut Room Tariffs To Encourage TourismThe global financial crisis has taken its toll on the Tourism Industry. At a meeting with the members of the Federation of Hotels and Restaurants Association of India (FHRAI), the Government suggested that hotels should slash their tariffs by 10 to 15 percent.

FHRAI Delegation comprised of 5 members namely Vivek Nair, Vice-chairman, Leela Group; Rajindra Kumar, Hotel Taj Ambassador, Delhi; Salim Sherwani, Sherwani Hospitalities Ltd; Dr. Sunil Gulati, Uttarakhand Hospitality and Major Harish Sud, Secretary general, FHRAI.

With the latest figures suggesting a slowdown i. e. in October this year, the number of foreign tourists coming to India was 4.53 lakh. This was a mere 1.8 per cent rise over the corresponding figure for October 2007, which stood at 4.45 lakhs.

In comparison, the increase in foreign tourist arrivals in October 2007, as compared to the same month in 2006, was 13.6 per cent, the government has aimed at attracting foreign tourist. India continues to be one of the most expensive destinations as far as hotel prices are concerned. A recent business travel report by American Express expects hotel rates to rise by 16% to 20% in the year 2009. This is the highest in the APAC region, ahead of countries like China, Japan, Hong Kong and Singapore.

Manoj Chacko, head and VP, business travel, American Express, stated the steep rise in hotel rates in the country ahead of the APAC region can be attributed to the demand and supply gap in India which is keeping the prices high despite a slight slowdown in demand.

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