Home Editorial The hospitality sector urged to relax the lockdown restrictions in Mumbai

The hospitality sector urged to relax the lockdown restrictions in Mumbai

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Malls and hotels face similar problems, almost 35 per cent of hotels and restaurants remain shut in the state due to last year’s lockdown because they could not sustain or survive. The turnover of the remaining establishments is below 50 per cent against pre-COVID-19 levels. With the latest lockdown order, at least another 30 per cent of restaurants will shut down permanently.

 In the wake of a dip in the positivity rate and oxygen bed occupancy, the Federation of Hotel & Restaurant Associations of India (FHRAI) requested that the restaurants in the city have been operating with level 3 restrictions whereas most cities in the State have been offered relaxations. The association has appealed to the government to be fair and to allow restaurants to operate as per permissible guidelines listed in the Level 1 unlock order.

This exaggeratedly watchful approach is resulting in extremely serious damage to the businesses, especially to restaurants in Mumbai. In cities falling under Level 2 including Thane, Navi Mumbai and Pune, restaurants and bars are operating till 11 pm even on weekends but only Mumbai remains an exception. Now Mumbai is in level 1 and it is extremely unfair to restaurants in the city to be not allowed to operate as per the permitted relaxations. The cure is turning out to be worse than the disease.

Since March 2020 restaurants in Mumbai have remained closed and were allowed to reopen briefly for a period of 4 to 5 months with several restrictions. No relief has been granted to the industry with regards to the payment of statutory charges. All these factors combined have led to financial losses resulting in the closure of almost 40 per cent of restaurants and hotels in the State so far and several more are walking a tightrope.

Huge numbers of businesses have suffered losses and many have closed down, particularly, the small and micro sector units that have a small investment. Many have been unable to pay their EMIs, shop rents and electricity bills above all taking care of family needs without any income. A moratorium was offered till the end of August but that has not helped many strained units. With failures, the already high NPAs of the banks will spurt and the financial sector is likely to face further problems.

In India business groups or small big traders, never got any support from anyone. They are assumed to be wealthy and get ignored by every sector. For the past one and half years many are gone hand to mouth and at least fifty traders of Mumbai committed suicide. Many Beauticians, salon owners, spa therapists and street vendors have taken their lives. They need to have savings to be able to take care of their families.

When there is no business, there is no work for daily wage workers. Daily workers need to be paid a living wage so that they can face the challenge of a future pandemic. The possibility of new viruses attacking humankind has increased as the environment has been greatly troubled and animals have come closer to human populations. In the last 20 years, the coronavirus is the seventh virus to have infected humans. Business is a chain if one segment suffers an entire setup collapse.  

Some could work from home (WFH) via the net but most could not. Children had to have classes via the net. The use of telecom services shot up. But the efficiency of work and studies was not what it used to be since people were not used to the new requirements. Businesses cannot expand unless demand revives but that is unlikely with the low consumer sentiment in the organized sector itself. It is much worse in the unorganized sector.

The government’s pro-business stance is also clear from the way lockdown was handled, very irresponsible and inefficient. It was eased when India had a rising number of cases. In most countries, the lockdown was eased when the new cases had dropped sharply. The business is down by 50 per cent in Mumbai. Hundreds of retailers in Mumbai, India’s financial capital, face similar challenges. Worst hit by the lockdown are stores that deal in non-essential services, as they aren’t even allowed to open at all, even for four hours.

The USD 300-billion-strong (EUR 250 billion) Maharashtra economy sunken into lockdown on April 4 with a nighttime curfew, followed by a complete lockdown announced on April 14, in an attempt to control the second wave of the COVID-19 pandemic which is ravaging the country. The government announced later that only essential services stores will be allowed to open, from 7 am to 11 am, which means that all other businesses, including malls, multiplexes, spas, clubs, restaurants, bars and beauty parlours will be completely shut.

Maharashtra is the richest state in the country, according to its Gross State Domestic Product (GSDP), and represents around 15 per cent of India’s total GDP. Mumbai-based rating agency Care Ratings has projected that around USD 5.4 billion of GDP is being lost in every month of lockdown. This kind of mass destruction of business has not been witnessed since Independence.

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