Centre to initiate process of disinvestment of ITDC properties
04 May 2017
The Cabinet Committee on Economic Affairs on Wednesday approved the initiation of the process of disinvestment of hotels and other properties of India Tourism Development Corporation Ltd (ITDC).
ITDC will kick off the divestment process with Hotel Lake View Ashok (Bhopal), Hotel Brahmaputra Ashok (Guwahati) and Hotel Bharatpur Ashok (Bharatpur).
In all three cases, the hotels / properties are being given back to the concerned states. In the case of Bhopal and Guwahati, ITDC is divesting its share of 51 per cent in the joint venture company formed for operation of the hotels whereas in the case of Bharatpur, the unit which was only managed by ITDC is being returned to the state government.
The decision on disinvestment has been made, keeping in view that running and managing hotels on professional lines is not the work of the government or its entities, a cabinet release stated.
As part of the disinvestment policy, the centre plans to lease or sub-lease the hotels / properties jointly with the concerned states or return the properties to the states, after fair valuation. The states would then have the option to upgrade and operate the hotels by involving private sector or to utilise the properties as per their requirements.
States have to exercise their options accordingly in each case, going forward with the option best suited to their needs, in line with the overarching principle that it is not the business of government to run or manage hotels, the release stated.
Moreover, ITDC hotels have not been able to align themselves with the developments in in the hospitality sector in the country in past years, with world class hotels and leading international chains of hotels entering the country and providing services and facilities of highest standards.