The actual foreign direct investment (FDI) in the Indian hotels and tourism industry since August 1991 has been only 10 per cent of the total approved.
According to government estimates, while it has approved an FDI amount of Rs 4,890 crore between August 1991 and June 2002, only Rs 520 crore has actually flown into the country. The flow is mainly through six proposals of the 377 proposals approved during the period.
Around Rs 76 crore has come in through the divestment of Lodhi Hotel in Delhi, another Rs 50 crore came in through the divestment of the Kovalam Ashok, but these were not included in the overall figure because the FDI came after June, 2002.
The other substantial chunk of investment was brought in by Kuoni in buying SOTC and Sita World at an investment of about Rs 200 crore.
Thomas Cook brought in Rs 105 crore early this year by increasing its stake in its Indian subsidiary from 40 per cent to 60 per cent.
Intercontinental picked up 12.5 per cent stake in its Mumbai hotel for Rs 15 crore, and Grand Hyatt picked up about 50 per cent stake in the Mumbai project of Umesh Saraf for Rs 110 crore.
The lack of inflow becomes significant because the multinationals are now planning to pick up stake in a project to ensure a long-term commitment and return.
