Union Budget 2021-22 expectations for travel infrastructure: The Covid-19 pandemic has wreaked havoc on the world economy and among the worst-hit sectors is travel and tourism. In India, while domestic travel is witnessing some recovery, it is still too early to mark a definite uptrend. Many places of pilgrims are also seeing increased footfall. Damodar Ropeways & Infra Limited. (DRIL) has been making ropeways for almost 50 years in the country and has them in pilgrim places like Vaishno Devi to Bhairon Ghaati ropeway. They also have the longest over-river ropeway at Guwahati, a twin section ropeway at Namchi in Sikkim and the Pushkar ropeway having the most gorgeous views and many more. The earlier Ropeways were mainly made for material handling in India however in the last 25 years, DRIL focused more & more on passenger Ropeways. The company has built approximately 50 cable cars so far. Pre-Covid DRIL Ropeways were carrying almost 4 million people annually, which has fallen drastically during lockdown.
Talking to Financial Express Online Aditya Chamaria, Managing Director, Damodar Ropeways & Infra Limited talked about the ropeway segment’s role in boosting travel and expectations from Union Budget of India 2021. Excerpts:
With the pace in development of infrastructure projects announced by the government, how important will be the segment of ropeways, their impact on planning budgets for the same.
Ropeways are at an important intersection of the infrastructure and tourism industries. Up until now, ropeways have mainly been used for tourism but now, a lot of State Governments are considering using it for urban transportation. Ropeways are a great alternative to traditional modes of transport because they are eco-friendly, pollution-free and can be put up at very competitive prices by companies like us.
Why do travel and tourism need the maximum support from the government and what can be other effective ways to support them apart from a relief package?
The Indian Government is yet to realize the full potential of ropeways to boost tourism and enhance connectivity. GST on ropeways is 18% which is higher than that on air travel, which is at 12%. In fact, ropeways should be treated at par with Railways where the GST is 5% with input tax credit at a minimum because they cater to all sections of society and are eco-friendly to add to that.
Even this tax reduction will go a long way in boosting the industry. Also, the volume of licenses, permits and general bureaucracy that needs to be navigated in order for a ropeway project to actually materialise is unimaginable. Ease of doing business needs to increase in this industry, and this will be support that will be welcomed wholeheartedly.
Ropeway industry plays a major role in promoting tourism for the country, making things easier for tourists. It requires high-end investments to ensure quality and assured safety. What are your expectations from the government in helping you overcome the after-effects of the lockdown period?
Ropeways, being part of the tourism industry, have been one of the worst affected sectors in India due to the pandemic. For the traffic of any ropeway site to reach pre-Covid levels will take a minimum of 2-3 years’ time. In the meantime, the government can support the ropeway industry by giving companies which employ more than 100 people their reimbursement of ESI and PF to its employees for a year.
Additionally, ropeways are usually made in places which are not accessible by other modes of transport, and are also able to maintain the general landscape of the space. Therefore, some subsidies to the extent of 30 – 40% should be given. We would also be greatly benefitted if terms of agreements that are signed with ropeway companies are more conducive to timely payments and lesser bureaucracy.