KSTDC to privatise more hotels in Karnataka

Tourism dept seeks additional funds to improve tourism infrastructure

The state-owned Karnataka State Tourism Development Corporation (KSTDC) plans to privatise some more hotels in the state that are not making enough profits.

The corporation is presently in the process of identifying the hotels to be privatised, a senior official said.

"The corporation is facing a severe shortage of staff in managing its hotel properties at various places of importance to tourism. Hence, we have decided to sell them off to private firms or lease them out. A final decision in this regard will be taken once the detailed plan of action is drawn out," commissioner, department of tourism, G Kumar Naik said.

He said that the KSTDC presently operates 16 hotels and three restaurants at various tourism destinations in the state, while it has already privatised 28 hotels.

"Some of our hotels are not making adequate profits and the corporation lacks suitable manpower to revive them. So it will be feasible for us to sell them off," Naik told Business Standard.

Presently four hotels are loss makers. They are located at Bijapur, Badami, Aihole in North Karnataka and Nandi Hills near Bangalore. The corporation had recently renovated hotels in Badami and Aihole. However, hotels at Mysore, Hampi, Srirangapattana and Bhagamandala are making profits, Naik said.

Despite a few of its hotels making losses, the KSTDC has registered a marginal profit of Rs 2.30 crore during 2005-06. Meanwhile, the corporation is mobilising additional staff to manage its existing hotels.

Naik said that the department of tourism aims to set up new hotels under a public-private partnership model at major places of tourist attractions in the state.

An integrated management plan is presently being worked out for the development of Hampi, a World Heritage Site, where it plans to set up a five star hotel jointly with private firms. The integrated management plan, will also focus on conserving the structures in and around Hampi.

He said that the department of tourism has initiated steps to attract more foreign and domestic tourists to the state. It plans to illuminate Bellary and Chitradurga forts this year.

The road connectivity to major tourist destinations have been improved in the state, he said adding that the department has received Rs 19 crore from the government for improving the approach roads to major tourism sites in North Karnataka.

A special package of Rs 7 crore has been sanctioned for Badami town for improving roads. The road network will be taken up by the Karnataka Urban Infrastructure Development Corporation (KUIDFC).

In addition to this the department has sought an additional fund of Rs 50 crore from the state government for creating infrastructure, he added.