Modest relief for Indian hospitality and travel sectors in Budget 2022

The Indian hospitality and travel sector has seen some relief in Budget 2022. The Finance Minister Nirmala Sitharaman has announced an increase in the Emergency Credit Line Guarantee Scheme (ECLGS) overall, with a special focus on hospitality and related services, especially micro and small enterprises (MSMEs)

ECLGS will be extended upto March 2023. Its guarantee cover will be expanded by Rs 50,000 crore to a total cover of Rs 5 lakh crore. The hospitality industry will get a special focus. There will also be a special focus on the development of infrastructure in the North-East. This is likely to boost tourism and employment in the region. E-passports will be rolled out to make it easy for people to plan overseas travel. These will be embedded with chips.

Sibasish Mishra, Founder & CEO, BookingJini, said, "In Union Budget 2022 there is no significant direct announcement impacting travel, tourism and hotel though there is a extension of ECLGS upto March 2023 is a welcome move. The same has been further expanded by 5,000 crores for the hospitality industry. This will help the cash strapped hotel entrepreneur to bounce back from the burden and losses of covid-19. Great news in the budget for backpackers and travellers exploring inaccessible by roads in the hilly areas, this budget proposed eight ropeway projects for a length of 60 km that will be awarded in 2022-23 as a pilot and with the success of these there will be more to come.

He also added, "The e-passport move will make the ease of travelling abroad much easier, travellers who already have been desperately waiting to go abroad since three years due to travel restrictions will avail this facility the most and we will witness surge in outbound tour. The Budget travellers' segment which compromises more than 66 per cent of the traveller will look forward for a great experience under Vande Bharat Trains in near future thus boosting tourism and hotel industry. These trains will be not only be energy efficient but also cheaper, faster and safer."

Chirag Agarwal, Co-Founder, TravClan, said: "Being a B2B travel tech Startup, we are happy to see that the ministry has prioritised our needs and has extended the tax incentive until March 2023. This is a much needed relief for new businesses such as ours to sustain and it'll also help a lot of new startups to take off. From a travel perspective, since travel agents are considered our primary partners, we welcome the much deserved loans that are being introduced to give this sector some relief. The pandemic has been tough on the industry and this decision will not only aid our business but will also impact the entire industry on the whole."