Which is India’s first government-owned five-star hotel? We know most of you might have thought of Hotel Taj!
But let us burst the bubble. The first government-owned five-star hotel in India was ‘The Ashok Hotel’, which is located in the country’s capital, Delhi. It is over 70 years old with an interesting and rich history.
So, back in the year 1955, the then Prime Minister Jawaharlal Nehru went to Paris to participate in a UNESCO program. During this, PM Nehru invited UNESCO to hold its next conference in India. But the problem was that there was no place where this conference could be held during those days. So he built a five-star hotel in Delhi for the UNESCO conference. And that’s how Hotel Ashok came to light.
But the hotel is making headlines because the government is set to give it on lease for 60 years!
The Ashok Hotel is up for lease! According to a report by the Times of India, the NITI Aayog has requested a structural audit of the hotel. The result was that the bidder would have to invest Rs 500 crore in refurbishing it. The government is expected to make a whopping Rs 10,000 crore from the first 30-year lease. The beautiful hotel has 550 rooms spread over 25 acres of land and includes a presidential suite. Initially, the government had planned to keep the hotel and land to itself but is now encouraging private companies through long-term management contracts. The winning bidder can also set up commercial activities on 1.8 acres of land.
Why is Ashok Hotel Being Handed Over to Private Players?
Ashok Hotel is being handed over to private hands as part of the government’s asset monetisation policy.
What is Asset Monitisation Policy?
The policy aims to unlock the value of government properties and create new revenue streams for the government by leasing them to private companies for a fixed period. This approach is preferred over the outright selling of government properties. The National Monetisation Pipeline (NMP), a Rs 6 lakh crore initiative announced by Finance Minister Nirmala Sitharaman in 2021, is an example of this policy in action. It aims to leverage the value of infrastructure assets across multiple sectors.
Big Companies Eyeing This Deal
Ashok Hotel is not only located at a prime location in the capital of India, but it is also an important part of the country’s rich history. Its presence in the Diplomatic Enclave adds to its attraction. Several prominent companies, such as Marriott International, Windham Hotels, DLF, HLV Limited, JLL, Hilton, and Taj Hotels, have expressed interest in acquiring the hotel. According to the Times of India, Marriott International has monitored the privatisation process closely.
Currently, the request for proposal and bid documents are being prepared, and it will be fascinating to see who takes over the reins of this iconic Indian five-star hotel.
That’s it for today. We hope you’ve found this article informative. Remember to spread the word among your friends. Until we meet again, stay curious!
*Companies mentioned in the article are for informational purposes only. This is not investment advice.