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Fani Aftermath: Odisha's Hotel Industry Limps With Rs 2,500 Cr Losses


15 May 2019

Snigdha Chandan Das


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Bhubaneswar: The hotel and hospitality industry of Odisha has been severed by cyclone Fani which hit the state during the peak tourism season. The losses have been peggeed at Rs 500 crore for the property damage, while the business losses are estimated at Rs 2,000 crore for the ongoing fiscal year, Hotel and Restuarant Asspociation of Odisha (HRAO) Chairman JK Mohanty said.

Maximum damage has been caused in Puri which is home to 800 big and small hotels all of which had to bear the brunt of the ferocious cyclone on May 3. As per latest reports, two of these hotels in Puri have started operations at a minimum capacity from Wednesday. "We expect the hotels in Puri to start operations at 70-80 percent capacity from the first week of June," HRAO vice-chairman, Raj Kishore Patra said.

"Puri hotels have lost a large number of bookings in terms of leisure travel and destination weddings. In Bhubaneswar a number of national and international conferences were cancelled. The losses of hotel industry have been huge as a result of the cyclone," Mohanty added.

The HRAO organized a workshop and has decided on Short Term & Long Term planning for development of the tourism sector of the State.

"As we are all aware that Odisha gets the lowest share in the country as far as foreign tourist arrivals are concerned, it was necessary to overcome the effects of the cyclone FANI and have a Long Term Policy towards getting more domestic and foreign tourist arrivals to the State," Mohanty said.

HRAO's Short Term Plan:

Immediate restoration of Power specially in the city of Puri along with all over Odisha.

Sewerage line cleaning and restoration of drainage system at Puri on war footing.

•        Street lights and all other public area lights must be operational with immediate effect.

•        All Financial Institutions must be given clear cut instructions by the Govt. authorities to give

2 years moratorium on existing term loans for repayment of Principal and Interest

Fresh Term loans to be disbursed for reconstruction, restoration and rehabilitations to all affected hotels with interest free moratorium period of two years and this fresh sanctions should be without any approval / documentations and on priority basis, within 30 (thirty) days from the date of submission of loan application.

All insurance companies must be given instructions from the Govt. to disburse 50% of the claim amount by 30th May 2019. Thanks to TATA AIG being the 1st insurance company to make the Ad-hoc payment to some of the claimant as a special gesture.

Revival and restoration of surrounding tourist places for tourist attractions specially in and around Puri, Bhubaneswar and Cuttack city.

It is estimated the damage to hotel industry is around 500 crores and govt. must plan relief measures to compensate this.

As business hampered tremendously, HRAO proposes the Govt. should exempt employer’s contribution component for PF & ESI must be exempted for a period of two years for all hoteliers.

HRAO proposes there should be special Tax exemption for hotel industry on the heads of GST, Holding Tax, Municipal Tax and other relevant statutory taxes.

A high level committee may be formed under the administrative control of the Tourism Secretary and the professionals from the hotel and tourism industry to resolve issues on priority basis.

HRAO proposes there must be substantial exemption for hoteliers on Electricity Billing, Transformer & Generator restoration expenditure and subsequent relevant statutory charges.

Immediate promotional activities by the State tourism through video films, print media (National & International), road-shows in major cities to get back the tourist flow to Odisha.

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J.K Mohanty, Chairman, HRAO