In 2019, India attracted 10.5 million foreign visitors; 5 million NRIs travelled back home to be with family and friends; 1.8 billion Indians travelled within the country for holidays, pleasure and leisure; 26 million Indians travelled overseas for tourism…. India has an estimated 53,000 travel agents, 115,000 tour operators, 15,000 adventure companies, 911,000 tourist transporters, 53,000 hospitality companies and five lakh restaurants … the industry employs an estimated 3.8 crore people. And these statistics do not include numbers for aviation and starred hotels which are not in the medium & small enterprises count.
Let us look at 25 possible trends in the near future, each important in its own way:
The 5 key factors, however, in the overall travel scenario that will drive all of the above trends will be:
The business may take anything between 9 to 24 months to start climbing back to previous peaks. Till then the headwinds will be strong and severe. Some will succeed, some will struggle, some will perish.
While discussing the revival strategies that can be adopted by the hoteliers, Sumeet Mehta (hotel valuations and finance specialist and the CEO of Paradigm Advisors) said that “Hospitality and Leisure Sector have faced the brunt of COVID-19 Lockdown with Summer Holiday Season totally washed out due to nationwide lockdown. Recovery in the sector is now visible as people have started stepping out and travelling. Hoteliers will have to focus on innovative marketing communications to created confidence in potential travellers that their properties are safe. Increased focus is required on cleanliness and sanitisation of properties to create confidence and evince interest. Premium properties that focused largely on MICE and corporate bookings will have to shift focus on individual travellers. Hoteliers will have to come up with attractive schemes and offers to pull guests and increase occupancy levels. Increased usage of technology and reduction in human interface to ensure safety along with a unique experience will ensure domestic travellers will be enticed to travel, thereby reviving hospitality and leisure sector.”
Rajkumar Sarrof, who owns the Pristine Travels private limited (a mid-sized Kolkata based IATA approved travel agency) gives insight into the problems being faced by the travel operators. As per Sarrof, the tour operators are a deeply divided lot, not just in size and scale, but also in terms of type of business, viz, groups, MICE, FIT, special interest, adventure tours, etc. Different segments have different ailments. The best general support can be to bring in a nodal agency, which can frame rules and announce them. Currently, rules are announced by different authorities, changes rapidly, and is very difficult to keep track of. Rules are in a complicated language and often interpretive, rather than made easy to understand. Support can be in the form of minimal interference, and by bringing in logical rules. Flight restrictions on certain days, keeping a resort open but most of its facilities closed, simply does not make sense….
Nitin Singh, the co-owner and Director of Royal Heritage Camps & Safaris, feels that while considering the revival of the tourism industry “the government should focus more on reforming policies for taxes, permissions, NOC, sanctions, and licenses; constructing more roads for better access especially for niche tourism destinations, and help in creating experiences and not merely sightseeing spots.”
While the revival of this industry must be made into a prime concern for the GOI, it is also essential that post COVID-19 the Indian tourism industry makes a move towards adopting a more sustainable, hygienic, and responsible form of tourism; the mantras being: hygiene, safety, health, quality, and value for money
There has been an increased interest in country’s ancient medical and wellness therapies including yoga, Ayurveda or various practices that come under the AYUSH ministry, Prahlad Singh Patel said. India witnessed a footfall of 6.97 lakh foreign patients on a medical visa in 2019. India, known for its Ayurveda and wellness practices, could benefit immensely from medical tourism as the world gradually recovers from covid-19 pandemic, said Prahlad Singh Patel, minister of state, ministry of tourism and culture on Thursday. He was addressing a session on ‘Reviving the stressed sectors to support the post-covid recovery for India’ at ASSOCHAM’s virtual conference.
“There has been an increased interest in country’s ancient medical and wellness therapies including yoga, Ayurveda or various practices that come under the AYUSH ministry. I feel that India will gain immensely from our ancient knowledge of medicine in a post covid world. Our ancient system of medicine, herbal cures and wellness methods are what people will look for in the coming months as they will deal with the challenges posed by coronavirus infection. After covid, medical tourism in India is expected to rise and we must be prepared for this opportunity,” he noted.
To be sure, India witnessed a footfall of 6.97 lakh foreign patients on a medical visa in 2019. This accounts for 6.9% of total foreign tourist arrivals, as per the estimates put out by ministry of tourism. This leaves a huge headroom for growth. Patel also said that the way Prime Minister NarendraModi led government handled the coronavirus crisis has improved the perception of India at the global level.
“A number of foreign tourists who were stuck in the country due to the pandemic and the subsequent lockdown chose to stay back in India as they felt safe here than their home country. Corona is almost over now and whatever damage that it had to do has already been done. My focus is on ways to address the impact of the pandemic on the tourism industry,” he added.
Patel said that he has accepted the loan restructuring proposals from the hospitality industry and forwarded it to the finance ministry for further approval. He also highlighted that the domestic tourism has started showing early signs of revival and the ministry will continue to promote various sectors such as wildlife and heritage.
“We are witnessing a shift where a majority of travellers are preferring to stay at small and unexplored properties than big hotels. It could be in various tiger reserve projects or other serene places where we have to focus now. Though I feel big hotels will continue to be relevant as international travel and events resume,” he added.
Quite similar to what was shown in the 2011 Hollywood movie Contagion, the Coronavirus has not only caused more than a million deaths, but it has also created abrupt changes in the daily lives of people within a very short time, while adversely affecting global economy and causing widespread panic….
In such a dismal scenario it is imperative that the Government of India takes notice and plays a crucial role in helping the tourism sector to revive itself. Perhaps it can start by bringing in some immediate measures that would reduce the rate of Goods and Services Tax (GST), such as, consider the lowering of GST rates on room tariffs between INR 1000 to INR 7500 for a specific period of time, and lowering the GST 18% on commission earned by tour operators and travel agents for providing certain services. Besides these, the TCS or Tax collection at Source, which is made while making payments to various hotels and airlines, can also be considered for exemption under tax relief measures.
Extending the time for availing Input Tax credit (ITC) for the FY 2019-2020 to March 31st 2021 will help to reduce pressure on cash outflow. Along with this, especially because tourism industry is facing severe losses, reversal of ITC can also be suspended until March 31st 2021. Extending due dates for filing GST returns, providing immunity from tax payment under reverse charge mechanism, and allowing GST on cash or receipt basis until March 31st 2021 can also be considered to help the tourism industry tide over this crisis period.
Courtesy: Monidipa Dey
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