In India the system depends on the number and standard of facilities, provided by the hotels. There is a Stratutorry appointed committee known as H.R.A.C.C. (Hotel and Restaurant Approval and Classification Committee) which comprise of representatives of government and the trade.
This committee classifies hotel again and sets criteria of standards and awards star rating. This criterion classifies the standard as “necessary, essential and desirable”. The star rating ranges from 1 to 5 stars and a 5 star rating is equivalent to first class hotels by international standards.
In each country they have their own system of classification like in America class II, III, and IV class. In Europe deluxe, I class, and tourist or Economy class hotels.