Nepal sees a boom in hotel construction

Published On: February 26, 2024 08:36 AM NPT By: Enika Rai

KATHMANDU, Feb 26: Investors are rapidly investing in hotels in the hope of substantial rise in the arrival of tourists. 

Entrepreneurs say that hotels with the capacity to provide services to around 3.5 million tourists annually were in place before the COVID-19 pandemic.

President of the Hotel Association Nepal (HAN) Binayak Shah said that the entrepreneurs are investing in the hotel sector as they see bright prospects in this field. "The future of Nepal's hotel sector is very good," he said adding, "In recent times, billions of rupees have been invested in star hotels that are being built with a professional plan, considering the future."

According to the data of the Department of Tourism (DoT), 20 five-star hotels have been registered in the country so far. Among them, Fulbari Hotel in Pokhara is currently closed while Everest Hotel's environmental impact assessment is in the final stage, informed Chun Bahadur Tamang, section officer at the Department of Hotels. He said that out of 20 five-star hotels, four have not renewed their license.

The sequence of hotel construction shows the immense potential of Nepal's tourism industry as a whole. Despite being a small country in the world in terms of area, the development of physical infrastructure in Nepal, which has immense potential from the point of view of tourism, also illustrates the strong state of tourism.

Stakeholders say that air connectivity needs to be expanded to bring in more tourists. They argue that the more international air connectivity can be expanded, the more tourists will enter the country.

The newly-built Gautam Buddha International Airport (GBIA) in Bhairahawa and Pokhara Regional International Airport (PRIA) in Pokhara have also increased Nepal’s capacity of welcoming more tourists to the country.

HAN President Shah said that although there is a situation due to which international flights cannot be conducted from GBIA and PRIA, this will not be the case forever. “There are no international flights now. However, this doesn't mean that it will always be like this. There will be international flights in the future, and there is a good prospect of hotel construction and operation,” he said.

Seeing the good potential of tourism in Nepal, international chain hotels are being built rapidly and some have already started operations. Hotel Marriott, Hyatt Regency Hotel, Shangri-La Hotel, Radisson Hotel are international five-star chain hotels in Nepal. Similarly, Sheraton, Hilton hotels are international star hotels under construction.

Last year, the government met its target of welcoming 1 million tourists to Nepal. A total of 1.15 million tourists entered the country via the air route. The year 2019 saw an all-time high arrival of tourists in Nepal when as many as 1.2 million tourists entered Nepal.

Recently, besides India and China, the number of tourists coming from America, Russia and European countries is gradually increasing. Lately, hoteliers have also been excited due to the increase in arrival of tourists.

Entrepreneurs are of the opinion that the hotel sector has benefited greatly with the improvement in the tourism sector after the Covid-19 pandemic subsided. There has also been an increase in the activities of domestic tourists.

Tourists coming to Nepal especially from India are coming not only by air route but also by road, of which there are no official records. Another main reason for the booming business of the tourism industry is the development of spending habits among Nepalis.

Lately, the hotel sector has been relieved as domestic tourists along with foreign tourists have started visiting tourist destinations in equal numbers.

At the same time, the data of the Department of National Parks and Wildlife Conservation (DNPWC) shows that in the fiscal year 2022/23, a total of 932,532 domestic and foreign tourists visited the protected areas. This is the integrated data of foreign and domestic tourists. “Seeing the potential of domestic tourists, investment in the hotel sector has been increasing recently,” HAN President Shah said.

According to the data of the DoT, currently 32 four-star hotels, one five-star deluxe hotel, three deluxe-heritage hotels, two luxury heritage boutique hotels and one ordinary heritage boutique-level star hotel have been registered in the department. According to the entrepreneurs, star hotels can be operated with ease if the government facilitates in making arrangements of air links and roads simple and helps in tourism promotion.

Not only billions of rupees have been invested in the hotel industry, but the hotel sector is also a sector that pays a lot of revenue to the government and contributes economically to the government by creating millions of jobs.

Similarly, the number of tourists is gradually increasing by 10 to 15 percent every year, international airports are coming into operation, the volume of tourists is gradually increasing, infrastructure development is getting priority, and the prospects of hotel business are also bright.


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