Himachal Govt may challenge HC order on HPTDC hotel closures, Proposes revival plan
The Himachal Pradesh government is gearing up to challenge a recent High Court directive that ordered the closure of 18 loss-making hotels managed by the Himachal Pradesh Tourism Development Corporation (HPTDC). Instead of shutting them down, the state plans to present a comprehensive revival strategy aimed at transforming these properties into profitable ventures through renovations and improved management practices.
Government’s Revival Roadmap
The state government has assured the High Court that it will submit a roadmap designed to increase the occupancy of these hotels to 90%. According to HPTDC Chairman Raghubir Singh Bali, most of these hotels, despite being in prime locations, have been neglected for decades, leading to their current dilapidated state.
“We will renovate these properties and turn them into profitable ventures,” Bali said, emphasizing the potential of these hotels to regain their former glory.
Collaboration with Private Players
To rescue the corporation from its mounting financial losses, the HPTDC has initiated plans to lease out several properties to private players on an operate-and-manage (ONM) basis. This includes both loss-making hotels and those generating marginal profits. Properties like The Palace in Chail and The Peterhoff in Shimla have already attracted interest from leading hotel chains.
However, the decision to involve private entities has not been without resistance. The HPTDC’s 1,700 employees have opposed similar moves in the past, fearing the loss of jobs and benefits. Bali, however, reassured that employee interests would be safeguarded throughout the process.
Financial Challenges
The financial strain on the HPTDC is significant. As of March 2022, the corporation had accumulated losses of ₹122.38 crore. Currently, 35 out of the 55 hotels and restaurants operated by the HPTDC are running at a loss, with occupancy rates ranging between 25% and 40%. This underperformance is particularly surprising given the prime locations of these properties, many of which are situated in popular tourist destinations like Kasauli, Manali, Dharamshala, and Dalhousie.
High Court’s Surprising Closure Order
Interestingly, some of the hotels slated for closure by the High Court are profitable. These include The Palace (Chail), Kunzam and Log Huts (Manali), The Castle (Naggar), Hotel Meghdoot (Kiarighat), and The Bhagsu (McLeodganj). Despite their performance, these properties have been grouped with loss-making units for closure, raising questions about the court’s directive.
Boosting Himachal’s Tourism Potential
Many of the underperforming hotels are located in Himachal’s most sought-after destinations, offering immense potential for revival with proper management. The government’s efforts to renovate these properties and engage private expertise aim to unlock this potential and strengthen the state’s tourism sector.
As the state moves forward with its revival strategy, it hopes to strike a balance between preserving the interests of employees and ensuring the financial sustainability of its tourism assets. Whether the High Court accepts the proposed roadmap remains to be seen, but the government’s determination to keep these iconic properties running signals its commitment to preserving Himachal’s rich tourism legacy. Further reports are awaited on this story.
