The introduction of GST will eliminate various taxes to prevail as the only charge that hotels must account for.
Parvesh Singh Bamel
The Indian restaurant industry is one of the most flourishing industry in India, worth Rs 75,000 crores and is growing at an annual rate of 7%. The industry is highly fragmented with 1.5 million eating outlets. Restaurant and all Hotels across the country generate approx 14 million jobs. The reason behind the rapid growth of Hotels and restaurant is the greater spending power and changing demographics. India’s per capita income has been increasing and this has led to an increase in the disposable income of Indians. Added to that is the concept of double-income households which is the result of more women joining the workforce. All this has led to an increase in the spending power of Indians, which is driving the growth of the food service industry.
Western lifestyle is one of the major reasons of growth of cafes and pubs in India. In a busy schedule of today everyone wants to socialize as socializing is today an inescapable phenomenon and everybody wants to eat better and cafes, bars and pubs are a great place to hang out. Many international hotels are also coming into play, International hotel chains will be increasing their expansion and investment plans in India, and are expected to account for 50 per cent share in the Indian hospitality industry by 2022.
The present government is trying their best to improve the hospitality sector in India which has a lot of potentials to grow. The long-term step that will have a positive impact on the industry would be implementation of GST. The introduction of GST will eliminate various taxes to prevail as the only charge that hotels must account for. The customer will only see a single charge on their bill and that gives them a better idea of the cost they are incurring for the services and products used.
Earlier in November 2016, during the time of demonetisation, the central government had taken number of steps for smooth transitioning to cashless mode of payment to ensure that no hardship is faced by the industry and remains unaffected from government’s demonetisation move. Post Demonetisation, the government has taken several steps for attracting digital and cashless mode of payment.
India’s hospitality industry has huge growth potential so lot of more things could be done in this sector. India has a total of 21 Central institutes of hotel management in the country and people applying in these are far more, so growth in the numbers of central universities and colleges which can help the people to get specialised in this sector would help. Digitalisation has brought a big change in this sector as people are now more focused towards online booking and online payment which is somehow beneficial for everyone. Many hotel chains are likely to increase their expansion and investment plans in India which will automatically create more jobs and in this skill development can help to those a lot who want to work on the ground level. It can be said that by 2022 India will be the biggest hub of multi-hotels and restaurant.
The author is owner of Alphabites Restaurant Pvt ltd. Views expressed here are personal.