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Business News/ Politics / Policy/  Govt planning rating system for homestays, guest houses
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Govt planning rating system for homestays, guest houses

Centre looks to set up database, work with online aggregators and state governments for certification process

Photo: Pradeep Gaur/MintPremium
Photo: Pradeep Gaur/Mint

To give e-tourism a boost, the commerce ministry is pushing for developing a database of certified guest houses, paying guest and bed-and-breakfast accommodation across the country that online market aggregators like Airbnb and Stayzilla can use, after doing their own due diligence.

The ministry has asked the NITI Aayog to anchor the plan and develop a rating system after discussions with state governments.

A commerce ministry official said that for back-end certification of properties on their platforms, online aggregators have to work with state governments. “If the state governments have not done the survey and certification, then it is far more difficult for the market aggregators. They can do it for select cities, but if you want to do it pan-India, then we need to develop a rating mechanism," he added.

Currently, a homestay requires a licence from the state government, which is valid for two years and needs renewal thereafter. It also mandates the hosts to reside at the property being rented out.

The official said the idea emanated from consultations with stakeholders as part of the commerce ministry’s global exhibition on services. “For hotels, the rating system is quite well known, but for accommodations other than hotels, such as bed-and-breakfasts, guest houses, paying guest accommodation, there has to be some mechanism that needs to be developed. So, all this is meant to make India ready for e-tourism," he said.

After consultations with state governments carried out by NITI Aayog, the ministry of tourism will work out the parameters so that state governments take a uniform approach, the official said.

“If we develop a rating system in sync with international practices, then when somebody claims I am providing a three-star accommodation, then the traveller broadly understands what to expect," he added.

The official said the exercise is similar to what the government has done for medical tourism. “The Services Export Promotion Council now has a mechanism by which various hospitals have got their accreditation done, so anybody who is a medical value traveller to India for some particular treatment knows the ratings of the hospitals and has some quality assurance," he said.

Chetan Kapoor, a research analyst at industry research firm Phocuswright Inc., said the mechanism would help intermediaries offer standardized accommodation. “It will help a consumer understand what the offering exactly means and what it will include," he explained.

Yogendra Vasupal, founder and chief executive officer, Stayzilla, said what’s needed is not just a database but full-fledged support from the government, including law enforcement authorities.

“The current database which is there is not really of value to us because we are expanding the market. What will help us is not just the database but the government supporting us in making homestays mainstream," he added.

To boost its services export earnings, the government extended its e-tourism visa to 150 countries in November 2014. This has started yielding results, with more than 434,000 foreigners availing of the facility of e-tourist visa on arrival in the first five months of 2016, a 293% growth in comparison to the same period last year, according to the data released by the ministry of tourism. The government is working to further liberalize its visa regime, including allowing multiple-entry tourist and business visas, as part of an effort to increase services exports.

Nathan Blecharczyk, chief technology officer an co-founder of Airbnb, told Mint in May that his firm has 18,000 properties across about 100 Indian cities. The number of Indian listings, however, indicates it is still a relatively small market for the firm, which has as many as 2 million listings across 190 countries.

Stayzilla, another online aggregator of budget hotels and homestays, currently offers 33,000 properties, including hotels, lodges, homestays and guest houses across 4,500 cities.

The travel and accommodation space has seen more action in the past year. Blecharczyk said that by 2020, the Indian travel market is expected to be worth $40 billion, adding that India has become one of Airbnb’s fastest growing markets in the world.

Online travel company Yatra and Stayzilla launched homestays in September last year. Earlier this year, MakeMyTrip Ltd said it will get into non-hotel alternatives such as dharamshalas, homestays and bed-and-breakfast accommodation.

Additionally, a handful of start-ups such as Deyor Rooms, Wudstay and The Hosteller offer travellers experiential homestays and short-stay packages.

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Published: 19 Jul 2016, 01:47 AM IST
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