Calls for Price Ceilings Intensify, ETTravelWorld

As hotel room rates in Delhi soar to as high as INR 20 lakh per night ahead of the India AI Summit, a new survey by LocalCircles highlights mounting consumer frustration over unchecked price surges. The study reveals that 74 per cent of consumers want the Government to establish hotel rate ceilings to prevent profiteering during high-demand events.

The survey found that 57 per cent of respondents have been overcharged by hotels at least once in the past three years, with some noting rates spiking five to ten times during concerts, sporting events and international summits. For instance, hotels near DY Patil Stadium reportedly charged up to INR 5 lakh for three nights during Coldplay’s concert, while prices around cricket World Cup venues rose three to five times the normal rack rate.

According to LocalCircles, there is currently no regulation under the Ministry of Tourism to limit room prices, leaving consumers exposed to sharp increases. The survey—conducted over 15 months—received more than 34,000 responses from citizens across 307 districts, with 47 per cent from tier-1 cities, 30 per cent from tier-2, and 23 per cent from smaller towns and rural areas.

When asked about pricing norms, 49 per cent of respondents said hotel rates should not exceed twice the regular rack rate, while 11 per cent supported a limit of up to five times. In total, 71 per cent of respondents favoured introducing some form of ceiling structure to regulate pricing.

On regulation, 74 per cent supported the formation of a government body to handle complaints related to profiteering, with 39 per cent recommending a new regulator under the Ministry of Tourism, 22 per cent favouring monitoring by the Competition Commission, and 13 per cent suggesting oversight by the Central Consumer Protection Authority.

LocalCircles stated that while the hotel industry advocates free market pricing, consumers seek safeguards to prevent exploitation during peak demand. “Given the hospitality sector’s importance for employment and tourism, balanced regulation is necessary to ensure both consumer affordability and industry profitability,” the report noted.

The findings will be shared with policymakers as LocalCircles urges the Government to establish a structured pricing framework that maintains market competitiveness while protecting travellers from excessive hotel rates during major events.