Inbound tourism to go up, say experts
Travel and tourism industry bigwigs share their analysis of Union Budget 2017
The Union Budget has pointed to a reloaded version of Incredible India with the government proposing to set up five special tourism zones and prioritising tourism as a growth driver and as a potential source of job creation that would have a multiplier effect on the country’s economy. Industry players reacted cautiously, having hoped for bigger policy directions but warming up generally to what is being considered a mixed bag.
Mahesh Iyer, COO, Thomas Cook (India) Limited, looked at the macro prospects. “This budget has very little to offer to the tourism industry, but with plans to launch Incredible India 2.0 as the next phase of growth for domestic tourism with respect to India, there is something to look forward to. India has a vast railway network and the recently announced Railway Budget acknowledges the strength of this. One of the biggest announcements is the withdrawal of service charge on rail tickets booked through IRCTC. This will not only lead to more bookings but will enable the consolidation of a digital economy. Another significant development is the emphasis on safety and sanitation, by introducing bio-toilets, which will increase passenger comfort. It is also encouraging to note the measures that will be incorporated to make the Railways friendlier for the disabled. With emphasis on a digital economy, by introducing measures like elimination of service charge while booking rail tickets on IRCTC, launching DigiGaons to facilitate employment and skilling, and even augmenting transactions done via the BHIM app; the Finance Minister has laid out a path that directs the country towards digital transformation. These are signs of a progressive growth story and we are confident that the steps charted in the Budget will act as catalysts for change and thus move people from the unorganised sector to an organised one. Having said that, from my point of view this budget is a subdued one.”
Peter Kerkar, Director Cox and Kings Ltd, is happy with the focus on the rural economy. “Infrastructure is a part of the 10 most important themes in Union Budget 2017, with allocation for infrastructure at a record Rs 3,96,135 crore. Road and rail infrastructure are crucial in terms of boosting tourism as these are widely used mode of transport in India. In this context, stepping up the allocation for national highways to Rs 64,000 crore, announcement of dedicated trains for pilgrimage/tourism and service charge withdrawal on booking of rail tickets are welcome moves which will help to accelerate domestic and inbound travel. Provisions made for clean and safe rail travel and making 500 rail stations disabled-friendly are also encouraging.
“We are quite positive about the focus on rural infrastructure development as we see a scope to promote rural tourism even further, especially for inbound tourists. However, we need to know more about what all will be covered in five special tourism zones to be set up in partnership with states.”
Aurvind Lama, co-founder and CEO of Travelyaari, sees the digital revolution impacting growth overall because of its inclusive nature. “The investment proposed in building national highways along with developing a road network is a welcome step, especially for players like us in the transport industry. This infrastructural development will greatly benefit the travel and tourism sector. Focus on improving internet and broadband connection in rural areas will go a long way to digitise cashless economy. The government’s focus on inclusion and encouragement of the MSME sector along with startups is also visible. Profit-linked deductions for three years out of seven will be helpful for emerging startup players.”
Gursahib Singh Sethi, co-founder, Travkart.com, feels there will be newer tourism hubs mushrooming across Tier II and III towns. “Further to the announcement for increase in railway connectivity to the remote areas and upgradation of airports in Tier 2 cities, a huge number of people will be able to travel smoothly from Tier 2 and Tier 3 cities. The high speed internet connectivity in rural areas will be the biggest advantage to them. This will help them opt for online bookings. The reduction of income tax to 5 per cent for those within the earning bracket of 2.5-5 lakh will encouarge savings and aspirational travel.”
SOTC Travel Managing Director Vishal Suri said five special tourism zones to be set up in partnership with the states along with the launch of the second worldwide Incredible India campaign will help improve inbound tourism. He further said the ban on cash transaction over Rs 3 lakh is a welcome move and will provide a level playing field.
RCI India Managing Director Pali Badwal said post-Budget, the industry hopes the number of inbound tourists will grow and India will become more accessible to global travellers.
However, Hotel and Restaurant Association of Western India (HRAWI) President Dilip Datwani said the tourism sector has been ignored. “There is no clarity on the proposal to establish five tourism zones....Despite acknowledging tourism’s potential in creating a multiplier effect for economy, the FM hasn’t really marked out anything significant for its promotion,” he said.
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