By Vipin Agnihotri
In my opinion, one sector that has gain advantage from the recent buoyancy in the Indian economy is the hotel industry. No one will argue with the fact that liberalization of the Indian economy coupled with growth in domestic businesses has led to steady rise in business travel in India.
As a matter of fact, foreign arrivals in India increased by 11 per cent between 2004 and 2005, and by 15 per cent between 2005 and 2006. The pivotal factor here is that more than 50 per cent of this number comprises foreign business travellers.
According to recent survey, India has been ranked as the fourth most favored country for holidays, above South Africa, Australia and Switzerland. If experts are to be believed, the availability of low cost medical facilities and the introduction of low-cost airlines are expected to generate increased demand for hotel rooms across plenty of cities in India.
In terms of statistics, there are 31,000 rooms across five-star deluxe, five-star, four-star and heritage categories in the cities of NCR, Jaipur, Kolkata, Mumbai and Chennai. It has come into the notice of The India Street that more than 30,000 new rooms in the same categories are in the planning or construction stage in these cities and will be ready by 2008-09.
Generally speaking, there are close to 1,10,000 hotel rooms across all categories in India. In my opinion, this number is quite low especially when you compare it to countries like China and US. Therefore, there is hardly a surprise that the hotel sector in India has failed to keep up with the exponential economic growth and there exists a substantial demand-supply game.
Because of this, high room rates and low availability has become the order of the day across major cities of India. According to sources, there is an immediate requirement of around 100,000 new hotel rooms, but only 75 per cent of that demand will be met by the projects that are currently underway.
Hospitality sector in India needs to be given a shot in the arm by the government. There is an urgent need to offer incentives such as raising the floor area ratio, giving land at subsidized rates and last but not the least developing rooms in the mid and the budget segments so as to facilitate the growth of this sector.
Suggested Reading:
0 comments:
Post a Comment