India will lose leisure travelers to some of it’s east and southeast Asian neighbors if it does not cut Goods and Services Tax (GST) on hotel rooms charging Rs 7,500 and above. EIH managing director and CEO Vikram Oberoi said this while addressing the shareholders of the company at its annual general meeting (AGM). He pointed out that much lower rates between 6% and 10% in Asian countries such as China, Thailand, and Malaysia will attract leisure travelers away from India. He was addressing the shareholders in the absence of executive chairman PRS Oberoi, who could not make it to the AGM on Wednesday. “With leisure spending accounting for 95% of total travel and tourism spending it is not something that we should take lightly. It is our earnest hope that the government will lower the GST rate by at least 12%,” he added. It is estimated that over 120 million will travel out of China to travel destinations around the world.
“The government should take note not only of visitor numbers but also the quality of visitors. We must take immediate steps to attract travelers from China, who account for 20% of tourism proceeds worldwide,” he added. Later, answering to shareholders’ queries, Oberoi said that the fall of Jet Airways has led to Rs 84.8 crore outstanding for the company. “We were working closely with Jet Airways for several years as far as our flight kitchen is a concern. We have done more than Rs 1000 crore business with the airlines,” he added. Commenting on setting up a hotel in Jammu and Kashmir, he added that it may explore the possibility. “We had property there long back,” he added. Box EIH is hoping to complete the construction of 50 additional rooms at Oberoi Grand in the next 15 months. It is investing Rs 100 crore for this expansion. A spokesperson said that the new rooms will be bigger in size compared to the existing one.