End of the tunnel? – and a time for reflection

After two years of gloom and despair, for tourism and hospitality industry April came with fresh winds of hope, not as the “cruellest month” as Eliot had famously said. As many parts of the country celebrated and ushered in the New Year, emerging trends brought cheer and good tidings.

According to JLL momentum report, the Revenue Per Available Room (RevPAR) witnessed a growth of 100.3 per cent year-on-year (YoY) — a remarkable recovery from the reported drop of national average occupancy of hotels by 48 per cent, the Average Daily Rate (ADR) drop of 34 per cent and the 66 per cent drop in RevPAR in the fiscal year 2021. Global hospitality data analysis agency STR has been quoted as “India’s hotel industry eclipsed pre-pandemic comparable in occupancy and average daily rate (ADR) for three consecutive days during the second week of April.” Reportedly domestic air travel is back growing to 10.5 m in April — a year on growth of 83 per cent and only 5 per cent less than the pre-Covid19 level. In fact, the same report also says that international passenger traffic for Indian carriers witnessed a surge to 185 m even surpassing the pre-Covid19 level. The combined effect of all these developments if sustained, is bound to boost travel and hospitality sector sooner and stronger than anticipated few months back.

Such time of good news however should also be a time for reflection on the lessons learnt during the bad times and also for discussions on the tasks for both the industry and the government on the road ahead. We are indeed living in an age of uncertainty and such constant worry about the future means that the industry cannot take anything for granted. The industry must be alert to the slightest wind of change in the atmosphere. For example, in an interesting article about the crumbling of “third party cookies” – of Google, Apple etc – Kurt Weinsheimer of Sojern says that for hotels, the elimination of third-party cookies may seem scary. But a vigilant management can turn it into an opportunity to “to build more authentic relationships with guests using less intrusive methods… enabling hotels to move beyond antiquated techniques to create a personalized experience that inspires travellers to book.”

The most volatile commodity and the most important element shaping the future will be trust and confidence. Confidence has been certainly growing aided by extensive vaccination and increasing public awareness and safety consciousness. Still, the uncertainty lingers. Shanghai, for example, is not only an enigma but also a symbol of doubts, suspicion and fear of the uncertain. 

Hospitality industry’s primary role and position in the national economy rests, among others, on its capacity to create employment. Covid19 took away, as the Minister of Tourism informed the Parliament, a staggering 2.1 crore jobs. Mahesh Vyas, managing director and CEO, Centre for Monitoring Indian Economy (CMIE), is quoted as saying that of the total labour force of 435 million in India in 2021-22, 33 million (which is 7.5 per cent) were unemployed. It is logical and necessary that government policy should nurture the job creation potential of the hospitality industry. A recent report attributed to Naukri.com says that 80 per cent of the job demand came from the hospitality industry. It is well known that an old survey of the government had established – and it perhaps holds good still – that the multiplier effect of employment in hospitality is four to five times that of manufacturing, agriculture or transport sectors. 

The industry will have to continuously juggle in the future between use of technology, digitalisation, creating quality employment and skilling of the manpower. The bottom line, of course is productivity and revenue.

In a path-breaking event, the President of UN General Assembly recently convened a debate on “Putting sustainable and resilient tourism at the heart of an inclusive recovery”. This concern for sustainable and responsible tourism has been the most overwhelming outcome of the Covid19 experience and the hospitality industry will have to don the leadership role in the future journey. It is only appropriate that HAI has joined hands with World Travel and Tourism Council (WTTC) to promote the concept of Hotel Sustainability Basics’ initiative among its member hotels. This initiative recognises set of criteria or benchmark for sustainable practices that all hotels should commit, adopt and implement. But more than acceptance of the criteria, sustainability should be the lifestyle and raison d’etre for the industry. The good examples set by the industry leaderships should flow down the line to all sections. 

There is much soul-searching required at the government level as well. It is undeniable that between recognising tourism as a pillar of development and giving it its due in the policy, there is a big gap. The policies and practices in government should be more constructive to support its pivotal role in employment generation and inclusive growth. Why is it that when all activities were locked down and income was zero, the industry had to run from pillar to post to get the statutory dues, the fixed charges on power etc exempted or deferred? When there was no capacity to pay, because of their compliance of state norms, why not the industry and particularly the vulnerable SMEs be given automatic relief in interest burden or in repayments of loans? Could not some of these 2.1 crore jobs have been saved if the government had come forward to hold hands of the employers who were trying to keep the jobs?

Time may lessen the pain of the industry of the last two unprecedented years but if the foundation of the future must be strong the lessons should not be forgotten. The future – uncertain though – is what we look forward with optimism.

The industry and the government, in an atmosphere of strong collaborative partnership should continuously discuss, debate and devise safe ways for the future and facilitate the hospitality industry to grow to its full potential and contribute to inclusive growth. Disaster management is not just limited to physical relief. More pertinent is prevention of social disaster that follows from failure to take timely remedial steps. What Albert Einstein said in a different context is so pertinent now for all the stakeholders — “Learn from yesterday, live for today, hope for tomorrow. The important thing is not to stop questioning.” 

AUTHOR BIO: MP Bezbaruah is Secretary General, Hotel Association of India