Hotel and restaurant industry on lockdown 3.0: Need immediate assistance from govt

Hotel and restaurant industry associations and chains in the business said while they weren’t expecting a lifting of restrictions for the industry in the third phase of the lockdown, they are dying a slow death in the absence of any relief measures and a stimulus package from the government.

In the third phase of the lockdown, hospitality services including hotels and restaurants remain prohibited throughout the country.

“We understand restrictions have been reduced but what will kill us is the absence of a stimulus package and no relief on statutory payments and what lies ahead. If the government wants to contain large scale job losses and prevent about 70% of the business from shutting down, properties becoming non performing assets then it needs to come out with something. At the state level, there are problems of property tax, electricity bills. There are different expectations from the state and different from the centre on this,” Pradeep Shetty, honorary secretary, Federation of Hotel and Restaurant Associations of India (FHRAI).

National Restaurant Association of India (NRAI) president Anurag Katriar who is also the CEO of Degustibus Hospitality which runs Indigo Deli said his company, like many others, will now permanent close outlets of brands in certain locations.

“We weren’t expecting the lockdown to lift for us anyway, especially in the big cities that are pretty much entirely red zones. The government can keep giving diktats on pay cuts and salaries but we don’t have the money. April salaries were already a problem,” he said.

“We employ 7.3 million people. If 30% people lose their jobs, that’s 2 million losing their jobs. I don’t think the nation can afford to do that. The government should pay up our employees. With each passing day and no respite coming from the government, our ability to reopen restaurants is getting diminished,” he said.

Manu Chandra chef partner at Toast & Tonic, Fatty Bao and Monkey Bar who has brands present in seven cities said if the logjam continues, shutting down of restaurant brands and outlets would become inevitable.

“We are not saying pass a bailout package like the US and give out trillions of dollars. But low interest loans with good repayment terms could be made available immediately. Everyone is looking for a lot more clarity from the finance ministry, from the MHA on this before we are compelled to take more hard decisions,” he said.

Hotel chains like Royal Orchid have hiked the pay cut percentage by 50% for their senior staff. Staff with monthly salaries of more than Rs 2 lakh at the chain had undertaken a 20% cut previously.

“The industry is affected 100% currently. When the supply of money is not there how will we manage cash flows,” said Royal Orchid CFO Amit Jaiswal.

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