India’s hospitality and tourism sector has intensified its pre-Budget pitch for long-pending structural reforms, arguing that industry status and streamlined approvals are essential to unlock affordable funding, accelerate hotel development, and strengthen the country’s global competitiveness.
The demands were placed before Finance Minister Nirmala Sitharaman during a consultative meeting on Thursday, part of the Centre’s ongoing stakeholder engagements ahead of the Union Budget.
Industry bodies said formal industry recognition would allow hotels and tourism businesses to access credit on better terms, similar to manufacturing and other priority sectors. Despite being a major employer and foreign exchange earner, tourism continues to be classified differently across states, limiting access to institutional finance.
In addition to industry status, representatives pressed for a single-window clearance mechanism for hotel and tourism licences. They argued that the current system—spread across multiple departments—creates delays, raises compliance costs, and discourages investment. The sector has also sought a reduction in the number of approvals required to build and operate hotels.
The meeting was attended by senior representatives from the Hotel Association of India, Association of Domestic Tour Operators of India, Indian Association of Tour Operators, India Food Tourism Organisation, Tourist Guide Federation of India, Adventure Tour Operators Association of India, MakeMyTrip, and VFS Global, among others.
Stakeholders also reiterated the need for clearer GST treatment for the hotel industry, particularly on input credits and seasonal pricing. At present, room tariffs between Rs 1,000 and Rs 7,500 attract 5 percent GST, while rooms priced above Rs 7,500 fall under the 18 percent slab.
To drive international arrivals, industry leaders urged the government to scale up global promotional campaigns and improve India’s visibility in key source markets. They noted that stronger branding, combined with easier licensing and affordable credit, could significantly boost tourism growth as states expand infrastructure and connectivity.
