"Nobody wants to come to Hyderabad these days, thanks to the Telangana protest," G.V. Krishnaiah, vice president of the South India Hotels and Restaurants Association (SIHRA) for Andhra Pradesh, told reporters here Saturday. "The occupancy rate in many of the star hotels in the state is just 30 percent," he added.  "The restaurants too have suffered around 40 percent slump in business." 

In Tamil Nadu, around 4,300 star rooms will be added by 2013, putting pressure on room rents and people's cost -- the former going down and the latter going up, said T. Natarajan, vice president of SIHRA for Tamil Nadu. According to him, there is an excess of rooms and hotels are letting them out at 40-50 percent of their published tariff rates.

"Further, in terms of room rent, the distinction between four- and three-star hotels  and others is becoming blurred," he added. In fact, most of the 14,500 new rooms are being added by three-star hotels. Natarajan said serviced apartments will also poach into their guest and human resources.

The addition of hotel rooms will make it difficult to increase the rates, as global economy is expected to slow down, impacting business travel to India. He said the travel advisory issued by various countries after a terror attack in India is also affecting the hotel industry. "Many of the hotel chains are now going asset free and focusing on managing hotel properties owned by others," Natarajan said.

A similar situation exists in Karnataka where hotels are not able to revise their room tariff upwards, though their other costs are going up, said K. Shyama Raju, president of SIHRA for Karnataka. According to him, the Karnataka government is now encouraging home-stay accommodation for tourists -- government recognised residences can host tourists. "Nearly 1,500 home-stays have been recognised by the Karnataka government in Coorg and Chikmaglur areas," he said.

Hoteliers demand the government should tax them on the actual rate they charge guests and not on the published rates. "Hotels should be charged industrial rates for power, instead of commercial, which is higher than the former," Natarajan said. Similarly, the hoteliers demand, the government should give out its land on long lease to hoteliers.

IANS