The National Restaurant Association of India (NRAI) has urged the government to grant industry status to the food services sector while advocating for a fair e-commerce policy and structural reforms. These measures aim to create a level playing field for restaurants, delivery partners, and consumers, protecting them from exploitative practices.
In its pre-Budget recommendations, NRAI emphasized the need for extended operational hours, targeted subsidies, and improved access to financing for small and medium enterprises (SMEs). The association highlighted that the food services sector is projected to reach Rs 7,76,511 crore and grow at a compound annual growth rate (CAGR) of 8.1% by 2028, positioning it as the third-largest food services market globally.
Industry status would provide benefits such as lower utility tariffs, reduced property taxes, and easier access to financing with softer loan terms. NRAI also called for the rationalization of licensing processes, advocating for a simplified and standardized framework addressing food safety, hygiene, labor, taxation, and environmental concerns.
On taxation, NRAI proposed the reintroduction of GST input tax credit (ITC) for the sector. Additionally, it recommended the introduction of a new GST slab between 12% and 18%, with ITC, for restaurants not located in hotels charging room tariffs above Rs 7,500.
The association also raised concerns over the GST on commercial leases under the Reverse Charge Mechanism (RCM), citing increased financial pressure on smaller restaurants and MSMEs. NRAI underscored the sector’s critical role in contributing to government revenue, employment, and overall economic growth while emphasizing the need for timely policy interventions to unlock the sector’s full potential and ensure sustained growth.