The national air carrier Air India should allocate at least Rs 100 crore to its wholly owned subsidiary Hotel Corporation of India Ltd (HCIL) to revive and upgrade its services in the hospitality segment, recommends a Parliamentary Standing Committee.
In a report recently related to the revival and restructuring of HCIL, the department-related Parliamentary Standing Committee on Industry led by Tiruchi Siva, Member of Parliament at Rajyasabha, said that substantial allocation of resources should be made available to the Air India for making the units working under the HCIL more financially viable and sound. The report was laid on the table of the Lok Sabha on December 6, 2012.
The Committee elaborated that it would like to see the Air India, the parent body of the HCIL, take measures so that at least some portion of amount is released for its revival is utilized for HCIL.
“It will help the HCIL to improve its MoU performance. The Committee recommends that this amount must be at least Rs 100 crore which would be exclusive of Rs 25 crore already earmarked in the outcome budgets..” says the report. It also expressed its hope on the Government of India's decision to pump in Rs 20,000 crore to revive the struggling airline.
The Committee is awaiting a response from the government on the recommendations, said Tiruchi Siva, chairman of the committee. “We have given some recommendations. It has been tabled in the Parliament. The government will give its comments on the recommendations and we are yet to get that. I think they will get back to us shortly,” he told Business Standard.
HCIL has two hotels under the brand name Centuar, located in Delhi and Sri Nagar, and two Flight Kitchens under the brand name Chefair, situated in Mumbai and Delhi. The Committee noted that the occupation in the 376 room Hotel in Delhi, despite being in advantageous location close to a major air port, has a capacity utilisation of only around 64 percent, due to lack of renovation.
Many of the rooms in the Hotel facility in Srinagar, which has 249 rooms, is occupied by security forces and other officials while it is “almost impossible” to get a room in the Kashmir valley in the peak tourist season.
The Committee said that the government has allocated Rs 11 crore for the Hotel in Delhi and Rs 5 crore for the Hotel in Srinagar for renovation in the outcome budget of the Ministry for the year 2012-13. However, it further noted the money allocated during the earlier period was not fully utilised. For example, only 10 per cent of the Rs 15 crore allocated to each of the hotels during 2010-11 and 2011-12 were utilised.
Similarly, the flight catering unit in Delhi has a capacity utilization of only 22 per cent while it is 32 per cent of its installed capacity in the unit in Mumbai. It also found that only 4,300 meals were supplied by the Delhi and Mumbai units to Air India, as against the requirement of 23,000 meals a day (13,000 meals from Delhi and 10,000 meals from Mumbai per day).
It added that the HCIL did not take any measure for renovation of its hotel infrastructure and flight kitchens due to paucity of funds. “Such gross neglect for renewal and restoration of the facilities at its disposal has caused serious problems at a time when the hotel and hospitality sector is expanding in geometric proportions,” said the report.
