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RBI creates liquidity window of Rs 15,000 crore to help Travel, Tourism and Hospitality Industry

Posted : 04 June 2021 05:31:06 | By TWO Bureau | GNN Bureau

RBI creates liquidity window of Rs 15,000 crore to help Travel, Tourism and Hospitality Industry

The Reserve Bank of India (RBI) on Friday announced creating a special liquidity window of Rs 15,000 crore with a tenor of 3 years at the repo rate to provide liquidity support to the contact-intensive sectors hit by Covid-19.

Commenting on this announcement, Jyoti Mayal, President TAAI said, " TAAI & FAITH associations meeting and follow up note with RBI team this week they have accepted one of our major request of providing special liquidity to Tourism travel and hospitality at unprecedented lowest ever rates for 3 years."  Accordingly We had asked for a tourism corpus to be set up at closest to repo rates, which is the rate at which banks borrow and which we seemingly have been given to borrow on the same rate - never before done for any sector earlier. 
The banks are being incentivised too to lend at this rate. Hopefully the fine print and the execution of the commercial banks  on the ground is equal, she added.

Mr. Gurbaxish Singh Kohli, Vice President, Federation of Hotel & Restaurant Associations of India (FHRAI) said, “  The announcement has offered the industry a lifeline in its efforts to survive. We are glad that FHRAI’s efforts through various representations to the Government, RBI and other authorities have finally borne fruit. We thank the Govt. and RBI for provisioning a separate liquidity window of Rs.15,000 crore for the Hospitality and Tourism industry."

Rajiv Mehra, President IATO said, "We welcome the announcement by the RBI offering loans to the tourism and Hospitality sector on easy terms and lower rate of interest. Hope tour operators who have had almost zero income for past more than one year, would get some succour out of it."  Also, we would request the government to announce SEIS (Service Export Incentive Scheme) which is now pending for the financial year 2019-20 . Besides we expect some grant for the revival of the battered tourism sector and rationalisation of GST", he added.

The special liquidity window encourages banks to provide fresh lending support to hotels, restaurants, tourism, aviation ancillary services, and other services including private bus operators, car repair services, rent-a-car service providers, event/conference organizers, spa clinics, and beauty parlours/saloons.

These sectors have seen the biggest impact due to the second wave as authorities started imposing lockdown measures to curb the spread of the virus.

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Tags : RBI, travel and tourism, restarting tourism, FHRAI, liquidity to travel trade,

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