Our article quantifies the impact of the recent infrastructure listing announcement on a typical hotel investment and the benefits to both investors and banks. The inclusion of hotels with a development cost of over `200 crores and convention centres with a development cost of over `300 crores to the infrastructure lending list early October comes as a welcome step for an industry that has always been saddled with high interest rates, short repayment terms and consequently high debt service payments, all of which have been further exacerbated by the economic downturn. According to the Gazette issued by the Finance Ministry, the development cost thresholds include interest during construction but exclude land cost and lease charges.

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