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Paharganj turns quiet as note ban hits Delhi’s backpacker’s paradise

Paharganj, which has half of Delhi’s 1,500 budget hotels, and whose entire economy depends on foreign tourists, is witnessing a slump like never before

black money crackdown Updated: Jan 01, 2017 19:13 IST
Manoj Sharma
Paharganj, which has half of Delhi’s 1,500 budget hotels, and whose entire economy depends on foreign tourists, is witnessing a slump like never before.
Paharganj, which has half of Delhi’s 1,500 budget hotels, and whose entire economy depends on foreign tourists, is witnessing a slump like never before.(Ravi Chaudhary/Hindustan Times)

It is a bright, balmy December afternoon and most shopkeepers in Paharganj -- a busy tourist hub in central Delhi with rows of budget hotels -- are sitting outside their shops, sunbathing. The streets are unusually quiet in this otherwise chaotic and cacophonic place crowded with tourists at this time of the year. Most tawdry tourist establishments of this backpackers’ paradise -- money changers, courier companies, rooftop restaurants, tour operators -- are empty, their owners sitting idle.

PV Sarkar, who runs a handcrafted jewellery shop, is fiddling with his mobile outside, not bothered about a few people inside his shop.

“These are new kinds of tourists we have; they come to the New Delhi station to pick up friends and family members. They are here to spend time as these days trains are arriving late due to fog,” says Sarkar. “Demonetisation has driven out real tourists. Since morning, I have only sold a Rs30-earring. My daily sales used to be Rs 7,000, and now it is just Rs 700,” says Sarkar, his voice laced with anger and frustration.

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Paharganj, which has half of Delhi’s 1,500 budget hotels, and whose entire economy depends on foreign tourists, is witnessing a slump like never before. Hoteliers and shopkeepers here blame it on demonetisation. The occupancy rate at hotels here is 40% in December, the peak tourist season. The money changers here complain of lack of cash and the shutters are half down at most ATMs. It is difficult to spot foreign tourists, and the omnipresent touts offering hotels deals too have deserted the place.

Prashant Kapur, who sells handicrafts, has been watching movies on his mobile since morning. The shelves of his shop are filled with metallic Buddha statues, stone sculptures, puppets and an assortment of other handicrafts. It’s dark inside as most of the tube-lights are switched off. Kapur’s mood is hardly any brighter. “My business is down by 70% as there are no tourists right now. The few tourists who are here do not have enough cash; it is hard to find an ATM here that dispenses cash,” he says.

A near entry cafe at Paharganj in New Delhi. (Ravi Choudhary/Hindustan Times)

Sanjeev Baluja, who runs LTC Travel, is sitting inside his office, his legs resting on another chair pulled in front of him. The office has almost half-a-dozen workstations and over dozen chairs. Two of his employees are checking their Facebook accounts. A message on a glass wall welcomes visitors. ‘Go Cashless’, it says. But ask him and it becomes apparent that Baluja is delivering the message with a lot of bitterness.

“My office normally does not look like this, but then these are not normal times. Since there is no business, I have had to send half of my staff on forced leave. Most bookings from foreign tourists have been cancelled,” says Baluja. “When they came in November, they just could not exchange their currency. They faced a lot of harassment and were cheated . Most of them cancelled their trips and went to countries such as Nepal, Thailand, Laos and Cambodia from Delhi. Most bookings from foreign tourists till March have been cancelled.”

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The few ‘foreign faces’ in the area, he says, are mostly businessmen who import handicrafts from Paharganj, says Baluja. As we talk, Baluja dials a person called ‘Pradhan’. He wants him to meet us. Pradhan, a stodgy man in grey jacket, arrives in five minutes. His name is Arun Gupta and he is called Pradhan because the is the general secretary of Hotel Mahasangh, an association of Delhi’s budget hotels. Gupta says he is in a hurry and we would have to ask our questions fast. And before we could ask, he speaks against demonetisation. “The government could have easily allowed at least the foreigners to use old notes. It is grossly unfair to set an exchange limit of Rs 5,000 in a week for them,” says Gupta.

Soon, the conversation reveals that his concerns go beyond the welfare of foreign tourists – he lists a litany of demands of hoteliers that have not been met by the government and how Paharganj, which he proudly describes as a place that attracts more than half of the tourists that come to Delhi every year, has not got its due. “Without Paharganj there would be no tourism in Delhi,” he declares.

The Delhi government, he says, had plans for the area during the Commonwealth Games, which included a cafe in a local heritage building, a stage for cultural performances and a food plaza near the railway station. “But nothing came out of it. The government should promote the place as a tourist hub, it has a great potential,” says Gupta.

Paharganj’s first hotels came up in 1972 to cater to visitors to the Asia 72 Trade Show held at the then newly-opened Pragati Maidan to celebrate 25 years of India’s Independence. A large number of companies from India and abroad participated in the event. In the 70s, the area became a regular part of the hippie trail. In the 1990s, it attracted a large chunk of Russian and Japanese budget tourists.

The Asian Games in 1982 triggered a hotel boom here. As many as 70-80 hotels had come up here then. Many locals turned their houses into hotels. Today, Paharganj has about 700 hotels, with 5 to 50 rooms. The tariff ranges between R250 and R3,500.

While most hotels and eateries are struggling to get customers, one place that seems to be doing better than others is Wow Café , run by Rishikesh Shivanand. The owner has over half-a-dozen Korean passports at his desk and several SIM cards. The walls have murals by Korean artists. Shivanand is a former tourist guide and pretty fluent in Korean. “My place is like a home to South Koreans who come here for everything from food to SIM cards to travel consultation. But my place used to be much more crowded than it is now,” he says.

PAHARGANJ AT A GLANCE
  • Paharganj has about 700 hotels, with 5 to 50 rooms. The tariff ranges between Rs 250 and Rs 3500.
  • Hoteliers and shopkeepers say business has hit rock bottom after note ban.
  • Paharganj’s first hotels came up in 1972 to cater to visitors to the Asia 72 Trade Show held at Pragati Maidan to celebrate 25 years of India’s Independence.
  • In the 70s, the area became a regular part of hippie trail. In the 1990s, it attracted a large chunk of Russian and Japanese budget tourists.
  • The Asian Games, 1982, triggered a hotel boom here. Many locals turned their houses into hotels.

The place, it seems, is quite popular among tourists of other nationalities too. Most foreign tourists at his shop complain of their currency being accepted at lower rates in Delhi , empty ATMs and little cash in hand.“ My biggest problem is that it is hard to get cash and not every place accepts credit cards here. The worst part is I can only exchange 60 British Pounds and exchange rates here are bad. People are offering lower exchange than the prevalent rate,” says Yuan Yuan from China, who is in India with her friends. Tanya, who is from Germany, has a similar complaint: “I am getting a very bad rate for Euros, which is making my trip costlier. And we can only withdraw Rs 2,000 from ATMs. I am trying to save as much as I can.”

Like everywhere, the opinion in Paharganj is divided among shopkeepers on whether demonetisation is the right move. Nowhere is this divide sharper than at the garment shop of Suresh Kumar. Clad in a kurta-pyjama, he claims to be an office-bearer of a political party and a popular go-to man for shopkeepers in Paharganj.

But right now, it seems he is quite unpopular with his own staff.

As Suresh Kumar tells us how demonetization has killed business, Sanjeev Kumar, his employee tells him. “The government has done the right thing. Black money holders have nowhere to go now. I do not care if we have to suffer a bit in the process.”

Suresh Kumar says Sanjeev does not know anything and heads to attend a protest march against demonetisation.

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