Finally stepping forth and offering some relief to the Tourism sector, Smt. Nirmala Sitharaman, Union Minister for Finance, Government of India has just recently announced some relief measures for travel agencies and tour guides.
Under the new Loan Guarantee Scheme for Covid affected sector, working capital / personal loans will be provided to people in the tourism sector to discharge liabilities and restart businesses impacted due to Covid. The interest rate for the loans would be capped at 7.95 per cent. The announcement is part of Rs. 1.1 lakh crore (Rs. 1.1 trillion) loan guarantee scheme for Covid-affected sectors. The scheme will cover –
- 10,700 Regional Level Tourist Guides recognised by MoT and state governments
- Travel and Tourism stakeholders recognised by MoT (904)
- Loans will be provided with 100% guarantee, up to the following limits –
- 10,00,000 for Travel and Tourism Stakeholders
- 1,00,000 for Tourist Guides
- No processing charges and waiver for foreclosure / prepayment charges and no additional collateral required.
Amaresh Tiwari, Vice Chairman, ICPB said, “It is a good thing that finally the government has granted ‘recognition’ to a sector that contributes 8% to its GDP and 12% to employment. However, the amount of relief allocated is peanuts in comparison to the size of our contribution. A small amount given as loan will barely help our industry which has been badly bruised during the last 14 months. Besides this, the announcement regarding giving free Visas to the first 500,000 visas is an indication that the Government is looking at opening up the borders maybe by Oct. / Nov. this year, which is an encouraging news for the travel sector.”
“For an industry that accounted for such a large portion of the GDP and employment, they felt that a mere Rs. 300 crore was sufficient to resolve 18 months of damage. It is nice that the MoF FINALLY mentioned tourism, but it would not have killed them to offer more than a pittance of Rs. 10 lakhs. This is somewhat insulting. They finally accepted that they can do something for those recognised by the Ministry of Tourism. They should have done it as 5-10% of the 2019-2020 turnover of these companies. Rs. 10 lakhs will be useful to some of the smallest players, but will not go far for the majority. The industry in general has not been helped,” shared Rajeev Kohli, Jt. MD, Creative Travels.
Jyoti Mayal, President TAAI, stated, “We expected much more than what was announced. However, we believe the relief has focused more on domestic and inbound travel and only those registered with Ministry of Tourism (904). It is pertinent to note that with over 3000 members of TAAI alone, only those registered with MoT shall benefit. Our members have applied for MoT recognition and due to the pandemic over 200 have still not been approved. Most of the members engaged in Domestic tourism are registered with State Tourisms, with specific concentration to their regions. The outreach of this relief is minuscule.”
“We are grateful to the Hon’ble Prime Minister and Hon’ble Finance Minister for giving some relief to the tourism industry including 5 lakh free visas applicable till March 31, 2022, whenever visas are open, and we are grateful to the Hon’ble Tourism Minister for supporting the industry,” said Mr. Rajiv Mehra, President, Indian Association of Tour Operators (IATO) reacting to the announcements that were made by the Hon’ble Finance Minister during press conference this afternoon, giving relief to the affected sector including Tour Operators and registered tourist guides in tourism sector.
Mr. Mehra mentioned that he is hopeful e-Tourist Visa will open soon and has appealed to the Hon’ble Prime Minister that all visas for duration of 30 days should be free for all those who apply for Visa till 31st March 2023.
Mr. Mehra also thanked the government for considering loan to the tour operators and the guides but requested the government that Government should also consider giving one-time financial grant to all recognised tour operators which could be 50% of the wages paid by the tour operators in 2019-20 and Rs. 2.5 lakh to each tourist guide recognised by the Ministry of Tourism/State Government as one time grant.
Adding to that, Vice President, Jay Bhatia said, “While we appreciate that finally the Government has recognised our trade activities, but the impact of this relief shall not be overall. Less than 10% of the actual stakeholders only shall benefit as per the FMs package. To widen the scope of this relief, the Hon. FM must include those registered under MSME. We urge the Government, that all TTS registered under GST and who have already been contributing to the exchequer over the years, should be recipients of this relief package.”
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