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Hotels need not raise a toast for 5-star tag

Saturday, 23 August 2014 - 7:40am IST | Place: New Delhi | Agency: dna

Simplifying luxury I Centre does away with 17 clearances required for grading of hotels in the country

Roomed in
160,000 registered hotels in India
20,00,000 lodging services in the country

Luxury hotels that do not serve alcohol will now be able to claim the elusive five- or seven-star tag. Till now, to be a five-star or a seven-star hotel it was mandatory to serve liquor on the hotel premises, which further required the hotel to have an excise licence.

The central government on Friday, notified changes in the classification of hotels by doing away with more than 17 clearances and licences that were required by various local, state and central authorities.

In an announcement made by the Union Minister of Tourism and Culture Shripad Yesso Naik at the National Conference of State Tourism Ministers held in the Capital, the ministry sought to simplify the classification process.

Some of the clearance certificates include the land utilisation certificate, building completion certificate, coastal zone regulation clearance, forest and environment clearance, pollution control clearance, police clearance, fire safety clearance, airport authority clearance, health and sanitation clearance. From now on, hotels will have to furnish only the trade licence and the bar licence, if applicable.

Hotel owners welcomed the move, saying that the demand for the declassification has been in the running for more than two years. "It is a welcome step for us, and will ease the licensing process by making it faster and more transparent," said S M Shervani, president of the Federation of Hotel and Restaurant Associations of India (FHRAI). "If a hotel provides all the requisite paraphernalia, then there must be no reason to not give it a luxury tag. Market conditions will take its own course," he said.

He said the process was offset by policies in different states pertaining to property tax and minimum wages. Problems in licensing, and further classification, also arose in places that did not permit liquor.

The classification and grading, which happened on a public-private partnership, is usually carried out by a team comprising a central government official, a state official, a member from the Indian Association of Tour Operators (IATO) and a FHRAI member. While there are about 160,000 registered hotels in India, it is estimated that there are about 20,00,000 lodging services in the country. This includes ashrams, paying guests, motels and hotels, etc.

The changes, although of not much consequence to established hotels, will affect luxurious hotels that do not serve hotels, or hotels that are keen on expanding to other locations.

"Since our clientele is global, we will continue to have a bar and we have notified bar services in our website. But the waiving off the various licences will make it easier for any hotel to operate," said a management official of Shangri-La Hotels, which has a hotel in Delhi and is coming up with another in Bangalore later this year.

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