Home / Industry / Retail /  Dine-in restaurants in Delhi worry about survival as fresh curbs come in
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NEW DELHI : As the omicron variant spreads, Delhi has shut down restaurant operations in the national capital for dine-in services. The Delhi Disaster Management Authority (DDMA) -- while has decided not to impose a lockdown – has put in additional covid-related curbs including closing all restaurant dine-in facilities in light of recent cases.

Delhi’s lieutenant governor Anil Baijal announced in a tweet today evening, “In view of the increase in positive cases it was decided to close the restaurants and bars and to allow 'take away' facility only. It was also decided to allow operation of only one weekly market per day per zone."

So far, restaurants in Delhi were allowed to operate on weekdays up until last Friday till 9 pm for dine-in services. DDMA had also imposed weekend curfew in the city shutting down malls and restaurants on Saturday and Sunday.  

Restaurant operators fear that after Delhi other states may also consider further curbs on dine-in. After one quarter of good business, the closure of eateries for dine-in will wipe out the entire fourth quarter business, they said.  Anjan Chatterjee, hotelier and founder of publicly-traded Speciality Restaurants that runs chains like Oh! Calcutta and Mainland China, said all governments have it in their jurisdiction to follow the law till the infection rates go down.

"While the omicron variant is not dangerous, the reality is that the number of cases are soaring. The government has to take steps, but they should find a fine balance so that the most vulnerable industries - - like food and beverage -- are allowed to survive. Deliveries, regardless of the type of format restaurants operate in, do not make up for more than 30-40% of the total turnover," he said.

Restaurateurs said they have already been complying with various rules imposed and are seeing reduced dine-in revenues of up to 50%  due to seating capacity restrictions. Restaurants have also had to comply with business hour restrictions with daily night and weekend curfews that started at the end of December around the New Year festivities.

Ajit Shah, co-founder at White Panda Hospitality said such announcements are leading to a working capital crisis since rents have to be paid regardless of the disruption. "The policies are not conducive to continuing business. Political rallies are still going on and the local government has to realise that we also generate a lot of revenue. They need to support us too," he said.

Zorawar Kalra, founder at Massive Restaurants that runs chains like Farzi Café, Masala Library and delivery-chain Louis Burger, said he is hopeful that if hospitalisations and morbidities are not increasing, then these restrictions can be quickly removed as they are extremely debilitating for the already beleaguered industry. "If they continue, they will result in a major increase in permanent closures and unemployment in the sector," he said.

While dine-in restaurants are in a panicking, for companies whose primary focus has been home deliveries, it is likely to be a good run. Mansher Duggal, co-founder of Delhi-based Enoki Hospitality, that runs ten cloud kitchens for Asian and North Indian cuisines, said from a delivery point of view, they anticipate a spurt in business. His business, he said, saw about 40% growth in the last lockdown in April - May 2021. However, he added that restaurants should be allowed to continue operations with 50% capacity with strict regulations allowing only the fully vaccinated guests, similar to the norms followed in the US and the UK. He said more restrictions on restaurants will send an industry, that is still recovering, into complete disarray.

The National Restaurant Association of India (NRAI) said that in FY 20-21, the size of the restaurant industry declined by over half to 53% from around 2,00,762 crore that year versus 4,23,624 crore in FY 19-20. The industry body had hoped for a steady recovery but saw only one quarter of good business between October and December 2021.

NRAI said Delhi NCR is the ‘restautant capital’ of India with the highest number of restaurants in the country. There are about 95,187 eateries in Delhi including both organised and unorganised players. Out of this, 32,777 are organised (with FSSAI number and GST).

"While unorganised will also take the brunt of these new guidelines, the real brunt will come from the organised segment as they have a complete chain/employees, government taxes, suppliers etc. to deal with," said the association's president Kabir Suri. Organised players in the city generate a revenue of 31,132 crores since the dine-out frequency in Delhi is the highest as compared to the national average. Delhi eats out about six times a month as compared to the national average of 4.5 times a month. Suri said takeaway and delivery is just a meagre of this entire pie.

"We are also very worried about the fate of the over 3 lakh people employed in Delhi restaurants. We don’t want them to suffer but unfortunately, we don’t have adequate resources to support them for long," he added.

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