Room for more

New Delhi, Nov. 18: The rising rupee has forced many hotel chains to shift to a single-tariff system that enables foreigners to pay in the local currency.

When the dollar was ruling at high levels, hotel companies had ignored government directives on the single-tariff system. They argued that dual tariffs were the norm in most countries.

For instance, a five-star hotel in Delhi or Mumbai charged $300 (about Rs 15,000, when the rupee-dollar rate was Rs 50) for a room from a foreigner and a lower rate of Rs 12,000 from Indians.

However, with the dollar trading at just Rs 39, most hotel chains have done away with dual tariffs and are charging a flat rate for both foreigners and locals. Room rates have gone up because of this shift.

Higher rates

Five-star chains such as the Le Meridien, the Taj group and ITC Maurya have switched over to a single-tariff regime. “The dollar was falling every day for the last couple of months ... decision was taken to charge a single tariff from October,” said Tarun Thukral, chief operating officer of Le Meridien.

“The single tariff is here to stay. We are following international norms. This is what the government has been seeking for so many years,” Thukral added.

Under the single-tariff norm, New Delhi’s Le Meridien is charging Rs 17,000 per night for a single room, compared with Rs 12,000 for Indians and $300 for foreigners earlier. The rate for a double bedroom is now Rs 18,000 against Rs 14,000 for Indians and $350 for foreigners.

The Taj group, which was losing around Rs 3-3.5 lakh every day because of the falling dollar, moved to the single-fee system from September. Earlier, the hotel group charged Rs 12,000 for a single room and Rs 13,000 for a double bedroom from Indians. The room rates were $275 and $300, respectively, for foreign tourists.

The hotel chain is now charging Rs 18,000 for a single room and Rs 19,500 for a double bedroom from all its customers.

The ITC group of hotels has also started charging single tariffs from September. “It is important to maintain international standards. A single room rate also helps a lot more in accounting for delegates staying for conferences and other pre-fixed contracts,” said Deepak Haksa, vice-president (operations) of hotels division, ITC Limited.

Travel agents

Travel agents and holiday-makers have welcomed the move to end dual tariffs. “India is now a much richer economy. It is right that we adopt a single-tariff structure instead of a dual tariff, which many felt was discriminatory,” said Ravi Dubey, managing director of NIRD, a hospitality industry consultant firm.

However, many tour operators felt the rise in room rates under the single-tariff regime was “unfair”.

“The hoteliers are raking it in with huge bookings. They did not really need to increase the rates while ending dual tariff. However, one supposes that they did it to compensate for the losses they suffered from the rupee appreciation,” Debasish Chatterjee of CTI Travels said.

Fee for heritage sites

Earlier this week, the government moved to a single-fee structure for its historical monuments.

The fee per foreigner has now been fixed at Rs 250 for world heritage sites and Rs 100 for other monuments under the Archaeological Survey of India.