HOSPITALITY AND TOURISM Economic liberalisation has given a new impetus to the hospitality industry.As per the Industry sources, Indian hospitality industry is growing at a rate of 15 percent annually. The current gap between supply (61,000 rooms) and demand (90,000 rooms) is expected to widen further as the economy opens and grows.Further,the government forecasts an additional requirement of 200,000 rooms by the turn of the century.

It costs an average of US$50-80 million to set up a five-star hotels with 300 rentable rooms in India. The gestation period is usually between three and four years. Movements in real estate prices have to be watched, though they have stabilised in the past three years or so.

Non-five-star hotels are obviously cheaper and have have smaller gestation periods, but international chains are expected to go into the five-star category.

A rapidly growing middle class, the advent of corporate incentive travel and the multinational companies into India has boosted prospects for tourism. India's easy visa rules, public freedoms and its many attractions as an ancient civilisation makes tourism development easier than in many other countries.

Many foreign companies have already tied up with prominent Indian companies for setting up new hotels, motels and holiday resorts. The entry of McDonald's, Pepsico's Kentucky Fried Chicken, Domino's and Pizza Hut have given an international glitz to the hospitality sector.

Several international chains including Sheraton, Holiday Inn, Intercontinental, Hyatt, Radisson, BestWestern, Days Inn, Hilton, Quality Inn, Ramada Inn, Meridien, Kempenski, Four Seasons Regent, Accor, and Marriott International are entering or expanding their hotel network in India.

The contribution of the entire travel and tourism sector in India to Gross Domestic Product is estimated to rise from 8.6% (USD 117.9 billion) in 2010 to 9.0% (USD 330.1 billion) by 2020. Between 2010 and 2019 the demand for travel and tourism in India is expected to grow annually by 8.2%, which will place India at the third position in the world. Travel and tourism in India also accounts for 49,086,000 jobs in 2010 (about 10% of total employment) and is expected to rise to 58,141,000 jobs (10.4% of total employment) by 2020.

Within the travel and tourism sector, the Indian hospitality industry is one of the fastest growing and most important segments, revenue-wise as well as employment-wise. According to an estimate of the Economic Survey of India and Technopak, the Indian hotel industry accounts for USD 17 billion, 70% (USD 11.85 billion) of which take their origin from the unorganised sector and the remaining 30% (USD 5.08 billion) from the organised sector.