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FHRAI’s Five-Year Plan Initiative M.D. Kapoor, Secretary General, FHRAI
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At the behest of the FHRAI President, our Executive Committee has embarked on an ambitious initiative to formulate a Five-Year Plan for the organisation. The intent behind seeking to institutionalise a formal planning process is to ensure that FHRAI’s strategic priorities remain closely aligned with increasingly complex dynamics of our industry and responsive to the rapidly evolving needs and aspirations of our diverse membership base. The endeavour will be to contribute towards developing a renewed vision for the long-term and arrive at a broad consensus on a practical template of strategies and tactics which can guide our course of action over the mediumterm, irrespective of the annual leadership transitions. In this process, the Executive Committee will also draw on the domain expertise, market research analysis & insights, enhanced media exposure and stakeholder engagement facilitated by our PR agency, LinOpinion. The myriad issues, opportunities and challenges, which are identified, will be explored in greater depth and detail by the FHRAI Brainstormer’s Core and also shared with our various subcommittees for their suggestions on finalising an operational blueprint for effective execution and implementation. In the initial phase, the EC has decided to focus on three pivotal areas:
Government Policy and FHRAI’s Strategy :
FHRAI has always been intricately involved in all facets of policy formulation which impacts the hospitality and tourism industry, both at the central and state level. Recently, we have consciously worked towards expanding our sphere of influence, by scaling up our engagement with key ministries such as Finance, Home, External Affairs, Civil Aviation, Urban Development, Railways and Environment. A manifestation of these efforts includes our extensive pre- and postbudget interactions with MOF, substantive involvement and inputs on rule-making in areas like CRZ norms, FSI/FAR criteria in metro cities, liberalised visa regime, draft national PPP policy, etc. We recognise that economic and legislative reforms have significantly altered the regulatory architecture for business, particularly with the inception of empowered and independent agencies such as TRAI, CCI, FSSAI, etc., each of whom has a direct or indirect impact on our sector. Our successful and constructive approach to the complexities surrounding the impending implementation of the Food Safety & Standards Act, holds valuable lessons for our future engagement on major regulatory
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issues. Our calibrated strategy on FSSAI has involved creating awareness among our members across the country through an acclaimed series of interactive seminars and workshops as well as sensitising the top echelons of the FSSAI to the industry’s concerns and apprehensions, backed by ample technical and empirical data. We will continue to build on this success by further strengthening and augmenting our research capabilities and re-energising our internal communication and consultative processes. The recently reconstituted National Tourism Advisory Council, formation of FAITH and setting up of the high-powered inter-ministerial coordination panel on tourism under the PMO, will provide us with additional forums to actively represent the views of our members and advocate their interests. From a macro-perspective, the principal policy areas of our focus have been in demand for rationalisation of the industry tax structure, provision of a single window clearance mechanism for hospitality projects and granting industry and infrastructure status to the sector. The imposition of service tax on hotels and restaurants last year was a major disappointment. Our counter-strategy involves a swift legal challenge to this new
levy as well as a continuous dialogue with the government at various levels, highlighting the long-term detrimental impact of this retrograde step on the Ministry of Tourism’s goal to capture a minimum 1% market share in global tourism within the 12th Plan period. We will also continue to closely monitor the final contours of the GST legislation, as it makes its way through the parliamentary process. Meanwhile, representations have been made to CBEC and the empowered committee of state finance ministers to include hotels and restaurants in the proposed negative list for service tax. It is gratifying to note that this year’s Economic Survey has strongly echoed FHRAI’s long-standing demand that there be a uniform rate of luxury tax across the country, applicable only on actual and not printed tariff. After years of persistent efforts by FHRAI, the Union government has last year constituted the Hospitality Development Promotion Board (HDPB), envisaged as a single window for facilitating the multiple clearances required for hotel projects. We must now shift our focus to convince all state governments to set up similar boards headed by their respective Chief Secretaries, as only then will the full beneficial impact of this welcome
Glimpses of the FHRAI EC Meeting at Taj Bengal, Kolkata june 2012 I www.fhrai.com I