The Himachal Pradesh Tourism Development Corporation (HPTDC) is learnt to be planning to hand over some of its hotels to private players on an operate and management basis to make the loss-making corporation profitable, according to a report published in English daily The Tribune.
“We will share the roadmap to enhance occupancy in these hotels to 90 per cent with the high court. We will renovate these units and turn these into profitable ventures,” HPTDC Chairman Raghubir Singh Bali was quoted as saying by The Tribune.
Properties located in prime areas
A Congress MLA from Nagrota in Kangra district, Bali said most of the hotels were located in prime areas, but their condition had deteriorated over the past several years.
The talk of handing over these properties to private players comes two days after the Himachal Pradesh High Court ordered the closure of 18 loss-making hotels of the HP Tourism Development Corporation. The Congress government, though, has also decided to seek a review of the High Court order.
The government is learnt to be planning to submit a roadmap to the high court to turn the units profitable after their renovation. Any initiative to hand over the hotels to private hands, however, is bound to face resistance from the more than 1,500 corporation employees.
35 of 55 hotels, restaurants in losses
Bali was quoted as saying that the interests of the employees would be protected. The HPDTC’s losses stood at Rs 122.38 crore as on March 31, 2022, as 35 of its 56 hotels are in the red.
The high court order for the closure of the 18 HPTDC hotels has sparked a political row, with the opposition BJP alleging that the Congress-led state government intentionally weakened its stance in the Himachal Pradesh High Court to pave the way for their sale to foreign firms.
The Himachal High Court had ordered the closure of the 18 hotels on Tuesday, citing low occupancy rates and continued financial losses.
The court’s directive, issued by Justice Ajay Mohan Goyal, mandates that these 18 properties, located in prime tourist destinations like Dharamshala, Manali, Keylong, Solan, Kullu and Khajjiar, cease operations by November 25. Among the establishments set to close is the iconic Chail Palace, along with Hotel Dhauladhar in Dharamshala and Log Huts in Manali. The court found these hotels to be “white elephants” and described their management and maintenance as financially unsustainable given the consistently low occupancy rates.
BJP MLA alleges conspiracy behind move
BJP MLA Sudhir Sharma, who was with the Congress earlier, has come out strongly against the government over the move. In a statement, Sharma alleged, “It is unfortunate for our hill state that the high court has given orders to close 18 prestigious hotels of Himachal tourism department. It is common talk that the government deliberately weakened the case so that this property could be sold to foreign groups.”
Sudhir Sharma contended that if the government had robustly defended the corporation’s interests, the closures could have been prevented.
The HPTDC’s Managing Director has been held responsible for implementing the court’s directive and must submit a compliance affidavit by December 3. The high court noted that of the 56 hotels operated by the HPTDC, many have struggled with low occupancy rates. For instance, the Chail Palace had an occupancy rate of just 28.39% in 2022, dropping further to 24.42% and 26.26% in 2023 and 2024, respectively. Meanwhile, only a few hotels, including Hotel Hamir in Hamirpur and Hotel Jwalaji, showed occupancy above 50%.
