No room key! Delhi hotels going broke

The hotel industry in the capital is facing an uncertain future. The hotels will remain closed for more than four months after the coronavirus pandemic. Another insult to the violation is unsympathetic landlords, a labor crisis, and license-related issues. Hotels in other parts of the country have already started reopening as lockdown restrictions are gradually being relaxed, but ironically, this has not happened in Delhi.


Last week, Arvind Kejriwal’s government announced that hotels and weekly markets would be allowed to operate again from August 1st as part of Unlock 3, which sighs a sigh to hoteliers who say up to 4,000,000 families are directly or indirectly affected The closure of hotels in the capital brings relief. “As hotels in Delhi are no longer linked to hospitals, the Delhi government has decided to allow hotels and hospitality services to function normally, as is already permitted under the centre’s unlock guidelines,” the AAP government said in explained in an explanation.

Anil Baijal, Delhi Lieutenant Governor (LG), overturned the decision within 24 hours, saying that although the pandemic situation in Delhi had improved, “the pandemic situation remained fragile and the threat was far from over”. This sparked yet another conflict between the elected AAP government and the LG’s office, a third one during the pandemic. Deputy Prime Minister Manish Sisodia said the focus of the decision to open hotels is the fact that “8% business and employment” in Delhi is directly affected by keeping hotels closed.

“Approximately 8% of Delhi’s business and employment have closed because hotels have not reopened. At a time when they are hoping to be able to function again with Corona under control in Delhi, it is unfair for the economy to keep them closed “Sisodia, who is also Delhi’s finance minister, wrote to the Union’s interior minister, Amit Shah.

Stories of desperation

The hoteliers said the industry, which was instrumental in the economy of Delhi, is now in deeper crisis due to the shutdown. Several hotels could be permanently closed due to rising debt, they said. Even if some open with less occupancy, they will have to grapple with issues of labor crisis and license renewal.

Delhi has around 3,500 hotels with accommodation options. All 55 five-star, 120 four-star, 1,800 three-star and 1,500 budget hotels have been closed since the coronavirus check-in at the end of March. Most hotels have worked with Vande Bharat travelers or with delivery and takeaway options on a reduced capacity. “We don’t understand the logic of why hotels are only closed in Delhi, even though they are operated in neighboring Gurugram and Noida. We are deeply hurt by the politics of the hotel industry in Delhi, especially when we are suffering enormous losses due to the months of total lockdown, ”said Sandeep Khandelwal, President of the Delhi Hotel and Restaurant Association.

At least 40% of the 3,500 hotels in the capital are let. In Paharganj, 60% to 70% are rented, while around 40% of the hotels in Karol Bagh and 30% of the hotels in Mahipalpur near the international airport are rented. “The situation is even worse for owners like me who have rented hotels and have not been able to pay rent and other maintenance costs like electricity, water, property taxes, municipal bills, etc. I have two hotels in Karol Bagh with a capacity of 25 and 36 rooms and one of them is rented out. I’m paying Rs 7 lakh rent and Rs 1.26 lakh GST, excluding maintenance bills, ”said Khandelwal.


In June, several hotels were converted into Covid care facilities. However, the requirement of hotels to hospitalize Covid-19 positive patients has been a severe blow to the industry. The Association of Apex Industries Associations of India’s Hotel and Restaurant Associations (FHRAI) wrote to Prime Minister Narendra Modi expressing concerns about the orders. But then Delhi would see more than 3,000 new Covid-19 cases a day. The situation has improved so much since then that both the BJP and AAP are fighting for credit. From today’s perspective, 90% of the 1.39 lakh Covid19 patients in the capital have recovered. This trend prompted the Delhi government to decouple the hotels and allow them to operate. As in other states, the pandemic has affected the capital’s economy, especially during the lockdown. For example, in April the government could levy 240 billion rupees in sales tax and sales tax, which rose to 494 billion rupees in May and 752 billion rupees in June. 1,300 rupees were raised in July but that is less than half of the 3,500 rupees raised in July 2019

“The central government has approved the operation of hotels and weekly markets since June. Why are they rejecting hotels and weekly markets in BJP-ruled states like Uttar Pradesh and Gujarat, where the situation in Covid is worsening day by day? Hotels are operational in Delhi’s satellite cities such as Noida and Gurugram, which come under the states governed by the BJP. Then why not Delhi? “asked AAP spokesman Raghav Chadha.


The hospitality sector in Delhi was already under great pressure due to increasing financial indebtedness. The hoteliers are not satisfied with either the Delhi government or the LG. Why? Because the LG overturned the decision to open hotels and the Delhi government levied unreasonable taxes at a time when they expected exemptions. “Power Discoms have billed Rs 1.25 to Rs 2 lakh. The state government knows that hotels are completely closed. We need an immediate resignation. In addition, we want the Delhi Jal Board and the MCD to waive water bills, property taxes and sewage bills, ”said Mahender Gupta, Vice President of the Hotel and Restaurant Association of Delhi and owner of the Sky Rich Hotel in Karol Bagh. Hoteliers are also concerned as their regular customers move to neighboring towns to stay overnight. “We are in a prime location near the national and international airport. However, since our hotels are closed, we may lose our regular customers who made their way to Gurugram. Once our customers travel to other cities, it is very difficult to bring them back, ”said Rajesh Verma, owner of a hotel in Mahipalpur.