India’s hospitality industry represents the foundation of the travel and tourism economy since stakeholders expect Budget 2025 to launch a transforming year. The hospitality sector needs infrastructure status and GST simplification together with simplified processes to achieve global-level performance potential.
Industry authorities maintain that hotel and convention center projects worth more than ₹10 crore should receive infrastructure status designation. Affordable long-term financing access depends heavily on this proposed measure, according to Pradeep Shetty, who represents the Hotel and Restaurant Association of Western India (HRAWI). The industry will contribute massively toward achieving India’s $1 trillion tourism economy goal when this proposal is adopted.
Similarly, K.B. Kachru, President of the Hotel Association of India (HAI), highlights the acute shortage of hotel rooms in India. “We need to find international capital investments to narrow the demand-supply gap if we want to achieve our 2047 objectives,” he points out.
Rationalization of GST Rates
Hospitality organizations demand GST restructuring to improve their international competitiveness levels. The 18% GST rate businesses must pay for hotel accommodations exceeding ₹7,500 remains a high charge according to regional Asian standards. A proposed tax reduction to 12% for hotel rooms will enhance international tourism while increasing domestic traveler numbers, according to the HAI.
Tejus Jose from ibis and ibis Styles India operations recommends dropping restaurant GST from 18% to 12% with full input tax credit benefits. Through this measure, restaurants will minimize their expenses while being able to expand their businesses and produce additional employment opportunities.
OTAs access easier compliance processes together with less administrative work and consistent competition conditions with worldwide rivals through obtaining central GST registration.
Unlocking Regional Potential
Dharamveer Singh Chouhan from Zo World and Zostel points to the necessity of creating new tourist attractions by combining public and private sector cooperation under PPPs. He recommends giving operators in the tourism sector either affordable land opportunities or tailored partnership programs to promote alternative travel options and promote nationwide economic expansion.
Bone experts insist that investments throughout Tier II and Tier III regions serve to create regional development equilibrium. A redesign of the “Incredible India” campaign represents an opportunity to revive international tourism while working toward balancing outbound and inbound visitor numbers.
Addressing Skill Gaps
The industry’s growth hinges on a skilled workforce. Rajan Bahadur, CEO of the Tourism and Hospitality Skill Council (THSC), calls for increased budget allocation for skill development, apprenticeships, and digital transformation. The sector will be better positioned to handle present and forthcoming industry challenges and opportunities through this initiative.
Streamlining Operations
The development of a digital single-window clearance system that handles hotel licenses and no-objection certificates (NoCs) and approvals stands as the foremost objective of all stakeholders. Improved business processes simplify operations and support sector development throughout the industry.
Also Check:- The Vande Bharat Express successfully completed trial runs on the world’s tallest rail bridge.
Overcoming Challenges
Despite domestic tourism’s robust growth, challenges persist. The depreciation of the rupee has driven up airfares, impacting foreign tourist arrivals. Subsidies on aircraft fuel and innovative incentives could mitigate this issue.
A Catalyst for Economic Transformation
As Dhruv Shringi, CEO of Yatra Online, notes, the hospitality sector holds immense potential to transform India’s economy. By addressing these key concerns in Budget 2025, the government can empower the industry to thrive as a global tourism leader.
With the right support, India’s hospitality sector can emerge as a cornerstone of the nation’s economic and cultural resurgence, paving the way for a more vibrant and inclusive travel experience.
