The Food and Beverage industry and local restaurant businesses have been severely impacted amidst the nation wide shutdown to help reduce the spread of COVID-19. With an annual turnover of Rs 4 Lakh crore, the industry could potentially hit total bankruptcy as it fights a long and hard battle against basic survival. India's food services industry currently employs around 7.3 million people and contributes more than 18,000Cr in taxes. It is among the largest industries in the service sector and is 20x of the Indian film industry, 4.7x of hotels and 1.5x of the pharmaceutical sector. If lockdowns continue, 30% of the employee-base could lose their jobs.

The subsequent financial crisis triggered by the lockdown has made it extremely tough for restaurants to pay for expenses, rent, salaries & more and hence we are requesting the Finance Ministry and Government of India to help restaurants with employee unemployment pay cover, moratorium on upcoming statutory dues, delay in utility bill payments, holiday/temporary stoppage on EMI payments & interest, freezing rental dues & restoration of Input Tax Credit on GST for all restaurants. 

With a consistently growing middle class and increasing disposable income, the F & B sector was witnessing a healthy growth and accounted for 8+ percent of the country's GDP. According to a report by KPMG, the hospitality sector in India was expected to grow at 16.1 per cent CAGR to reach Rs 2,796.9 thousand crore in 2022.The hospitality sector encompasses a wide variety of activities within the services sector and is a major job provider both direct and indirectly. The sector attracts the most FDI (Foreign Direct Investment) inflow and is the most important net foreign exchange earners for the country contributing significantly to indirect tax revenue at the state and central level which includes revenues from VAT, Service Tax, and Luxury Tax etc.

Excluding the hospitality sector will also hurt the farming sector as the former is its significant consumer.

Restaurants association NRAI has classified their demands into three areas: people, operating issues and policy initiatives. On the people side, the recommendation is to provide unemployment pay cover to all employees (covered under the ESIC Act) in full till lockdown and 50 per cent post that. It can be a mix of cash and free food grains. The other major demand on the people side is extending moratorium on retail loans by employees to help them with their cash flows.

On the operating issues' side, the industry has been asking for complete waiver of all license fees and minimum rent for utilities for six months. In addition, there's demand to postpone the renewals of licenses, permits and registrations.

On the policy front, the industry has asked for immediate restoration of input tax credit on GST. This is long-standing demand of the industry though. After the government reduced the GST rates from 18 per cent to 5 per cent, the input tax component was removed. This has resulted in higher operating costs for the restaurants.

Please show us support and don't make us ask the valid question of #dowematter