NRAI had recently advised its member restaurants to shutter down till March 31 amid Coronavirus outbreak however the lockdown has become detrimental to the survival of these restaurants.
As the restaurant industry in India faces a grim battle for survival due to zero revenues amid the current lockdown period, the industry association National Restaurant Association of India (NRAI) has requested mall owners and independent landlords to waive off rentals and common area maintenance (CAM) expenses for temporary relief. “Some of the big mall owners such as Lulu Group, Lodha Group, Forum and Vegas have already announced immediate interim reliefs,” NRAI said in a statement. The association suggested a “moderate revenue share model for six months post the three-month period until “the business regains some lost foothold.” CAM is the amount paid by individual units for the maintenance of commonly used areas such as elevators, parking premises, corridors etc.
This is for “ensuring our (industry) mere survival,” that provides “jobs to millions” said NRAI stressing that the industry is not “trying to profiteer at the expense of the landlords.” The body also proposed revenue share equivalent to “50 per cent of the agreed terms with possibly a maximum cap at 10 per cent,” according to the open letter by NRAI to “landlords in F&B business”. “We are seeking these reliefs just for ensuring that businesses don’t die an instant death, leaving behind a trail of unfulfilled dreams, millions of lost jobs and massive unwanted litigation,” the letter read. NRAI represents over 5 lakh restaurants across India. The restaurant sector with an annual turnover of around Rs 4 lakh crore employs more than 70 lakh people, according to the association.
NRAI had recently advised its member restaurants to shutter down till March 31 amid Coronavirus outbreak however the lockdown has become detrimental to the survival of these restaurants. “Speaking on the subject, Anurag Katriar, President of NRAI; CEO & Executive Director of deGustibus Hospitality Pvt. Ltd said “NRAI is extremely thankful to the Govt of India & RBI for their recent measures aimed at mitigating some of our woes.
“Deferment of GST payments, concession extended on PF contribution and permission to employees to partially withdraw from their PF accounts, moratorium on EMIs and easing of interest rates are all steps in the right direction. We further appeal to various State Governments to extend similar reliefs on state taxes like Excise and VAT,” said Katriar. He also urged Finance Minister Nirmala Sitharaman for restoring the input tax credit on GST as it “will also help us significantly in bringing down our fixed operating costs.” Rentals and manpower expenses are the biggest components of a restaurant’s fixed operating cost.