Shimla, The Government of Himachal Pradesh has announced the “Interest Subvention Scheme for Home Stays under Chief Minister Tourism Startup Scheme in Hospitality Industry” to boost tourism, generate employment, and strengthen the rural economy across the state.
Introduction: Tourism as a Key Driver of Economic Growth
Tourism in Himachal Pradesh has emerged as a significant contributor to the state economy, with the tourism and hospitality sector accounting for approximately 7.78% of the State Gross Domestic Product (SGDP) as per the Economic Survey 2024-25. Recognizing the potential of tourism, the State Government aims to develop sustainable tourism initiatives while preserving ecological balance and promoting private sector participation.
The State’s unique geographical landscape, rich cultural heritage, scenic Himalayan ranges, rivers, lakes, sacred shrines, and hospitable communities make it an attractive destination for tourists worldwide. Home Stays in particular have been identified as key contributors to rural tourism, providing affordable accommodation and encouraging longer tourist stays in remote areas.
Objectives of the Interest Subvention Scheme
- Promote entrepreneurial spirit among the youth of Himachal Pradesh.
- Facilitate self-employment opportunities in the tourism and hospitality sector.
- Provide financial relief on loans taken to establish, upgrade, or operate Home Stay units.
Commencement and Duration
The scheme comes into effect from the date of notification in the official e-Gazette and will remain valid until 1st December 2027 or as specified by the State Government through future notifications.
Eligibility and Definitions
The scheme is applicable to bonafide Himachali entrepreneurs aged 18 years or older who wish to start or expand Home Stay tourism units within the state. Key definitions under the scheme include:
- Bonafide Himachali: A person with a permanent home in Himachal Pradesh or residing in the state for 20 years or more.
- Tourism Unit: Refers exclusively to Home Stays.
- Financial Institutions: Public and private sector banks, cooperative banks, SIDBI, and other government-supported institutions.
- Urban, Rural, and Tribal Areas: Defined according to Himachal Pradesh government notifications.
Interest Subvention Details
The scheme provides financial relief on term loans for Home Stays across different regions:
| Area | Interest Subvention (%) |
|---|---|
| Urban Areas | 3% |
| Rural Areas | 4% |
| Tribal Areas | 5% |
The interest subvention is applicable for a maximum tenure of three years, including the moratorium period. Loans up to ₹2 crore for Diamond and Gold category Home Stays, and up to ₹1 crore for Silver category Home Stays, are eligible under this scheme. Tourism units with total investment of ₹5 crore or less qualify for this benefit.
Application Process
Entrepreneurs can apply for interest subvention via the dedicated Tourism Department portal or offline. The required documents include:
- Provisional/Final Homestay Registration Certificate
- Preference of three banks for loan
- Bonafide Himachali Certificate
- Affidavit confirming non-receipt of other subsidies and commitment to run unit for at least five years
- GSTIN Number
The District Tourism Development Officer (DTDO) or Assistant Tourism Development Officer (ATDO) will verify the application and sponsor it to the bank for loan sanction. Interest subvention will be released quarterly to the beneficiary’s account through the nodal bank.
Key Conditions and Legal Compliance
- Units must operate for at least five years to retain benefits.
- Default on loan payments beyond three months may lead to suspension of benefits, and beyond six months, benefits will be revoked.
- Commercial electricity and water rates will apply.
- Applicants must maintain computerized records and GST accounts.
Expected Outcomes
- Boost to urban, rural, and offbeat tourism destinations.
- Formalization of the Home Stay economy.
- Increased employment opportunities in the tourism sector.
- Improved quality standards in hospitality ventures.