 "Hospitality body FHRAI urges govt to provide soft loans to industry")
Hospitality industry body FHRAI on Monday urged the government to provide soft loans to the hotel and restaurant sector as businesses are finding it difficult to sustain themselves amid the COVID-19 pandemic.
"A financial support of this nature will help businesses cover for the required working capital which in turn will help them sustain," the Federation of Hotel and Restaurant Associations of India (FHRAI) said in a statement.
Having registered only 20-30 per cent of the average pre-pandemic revenues across the country, the businesses are finding it more and more difficult to sustain with each passing day, it added.
"Our industry was the first to be locked and the last one to be reopened. So when we ask the government for support, it is because the government asked us to not conduct business for the longest duration," FHRAI Vice President Surendra Kumar Jaiswal said.
The COVID-19 pandemic has caused significant and far reaching economic damage to the hospitality industry. Zero business during the first seven months of lockdown, negative cash flows, threats of insolvency and millions of jobs losses have devastated the sector completely, the statement said.
"The government through a soft loan, with low rate of interest can support the industry until it reaches the pre-pandemic business levels. It is necessitated all the more today because the industry is finding it difficult to mobilize loans," FHRAI Honorary Treasurer D V S Soma Raju said.
Financial institutions have marked the industry in negative list or put it under negative rating. Therefore, a working capital support from the government will help the hotels and restaurants that are struggling due to negative cash flows to restart and sustain their operations, he added.
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