Union Budget 2024-25: Mixed Reactions from Hospitality Sector Amid Promises for Tourism Development

Finance Minister Nirmala Sitharaman's Union Budget 2024-25 received mixed feedback from the hospitality sector despite significant promises for tourism, infrastructure, and employment. Industry leaders like Pradeep Shetty and Rajesh Magow highlighted concerns over unmet sector demands while appreciating commitments to infrastructure and spiritual tourism development.

Finance Minister Nirmala Sitharaman unveiled the Union Budget for the fiscal year 2024-25 on Tuesday. The budget has drawn attention for its emphasis on infrastructure, employment generation, and spiritual and cultural tourism, but received mixed receptions from the hospitality and tourism sectors.

Pradeep Shetty, President of the Federation of Hotel and Restaurant Associations of India (FHRAI), expressed concerns about the budget's impact on the hospitality industry. Shetty highlighted that while substantial reforms were expected to align with the government's vision of a developed India by 2047, the budget did not meet critical sector demands such as GST rationalization, infrastructure status, and vital policy reforms.

"The hospitality sector had high hopes for the Union Budget, considering the government's vision of 'Viksit Bharat by 2047'. However, the budget fails to address fundamental challenges needed to reach a USD 3 trillion economy by 2047," Shetty said. He added that critical demands like GST rationalization and infrastructural status have not been considered, despite tourism's significant impact on employment and the economy.

Despite setbacks, Shetty acknowledged positive elements in the budget, particularly the government's commitment to infrastructure development, employment, and religious tourism. Initiatives to enhance spiritual and cultural landmarks, like the Vishnupath temple in Gaya, are seen as beneficial for economic and social impacts.

Rajesh Magow, Co-founder and Group CEO of MakeMyTrip, shared a positive outlook on the budget's focus on infrastructure. He praised the emphasis on enhancing road infrastructure, which supports travel and tourism, and welcomed initiatives to develop iconic spiritual and cultural sites.

Magow also appreciated the decision to reduce the TDS rate on e-commerce operators and the provision of TCS credit against income tax, noting that these changes provide relief to taxpayers traveling internationally.

(With inputs from agencies.)