NEW DELHI – If you’ve been planning to visit India – whether to soak up Goa’s splendiferous sands or ogle the Taj Mahal – now’s a good time to pack your bags. Hotel tariffs have plummeted by a whopping 30%, the Indian government has unleashed a raft of tourist-friendly sops and travel agents and airlines are offering great bargains.
With the portentous mix of a global economic slowdown and terror attacks eroding the growth of tourist arrivals in India, tourism has taken a beating. The Mumbai terror attacks on November 26, industry experts rue, have ruined the tourism season just as it was unfurling. As a result, compared to the 30% growth in the sector in 2007 – and double-digit growth for the past five years – the country is expected to post a tourist arrival increase of zilch this year.
This is a contrast from 2007, during which India witnessed a record number of visitors from abroad and a sharp rise in foreign exchange earnings through tourism. The number of foreign tourists in India touched a record 5 million in 2007, an increase of 12% from 2006. The estimated tourism earnings in 2007 were US$11.96 billion, compared to $8.93 billion in 2006.
This year, even till August, things weren’t actually so bad. Foreign arrivals had increased 10.4% compared with the corresponding period last year. The foreign exchange earnings during the same period rose 21.5%. Buoyed with this growth, the industry had set itself an ambitious target to more than double the number of arrivals to 10 million by 2010, when New Delhi will host the Commonwealth Games.
But all this looks unachievable now due to a combination of factors, including a plunge in the number of arrivals for the first time in six years by 2.1% in November, traditionally regarded as the beginning of the high season. The number of visitors in November nose-dived from 532,000 in 2007 to 521,000, while the corresponding foreign exchange earnings from visitors dipped by 12.5% to $1 billion.
To make matters worse, in the aftermath of the Mumbai terror attacks, almost 50% of bulk bookings by visitors (largely from Britain, Europe and the US) were cancelled. Travel advisories issued by the US, Britain, Australia, Canada and Singapore advising against travel to India did nothing to help things. According to Himmat Anand, co-chair of the Federation of Indian Chambers of Commerce and Industry’s tourism committee, along with corporate bookings which usually plunge at this time, no fresh bookings have been forthcoming. “India has suddenly disappeared from overseas tourists’ itineraries this year,” he said.
What has further aggravated the situation is that on account of a record tourist turnout last year, operators had invested heavily in infrastructure upgrades and renovations which are now cumulatively adding to their losses. “This has been one of the worst times for Indian tourism in recent history,” said Anil Kalsi, chairman (northern region) of the Travel Agents Association of India.
With panic buttons buzzing everywhere, the Ministry of Tourism has been forced to take urgent steps to increase footfalls to the country. It is now working on a war footing with trade associations and airlines to push up visitor numbers through a slew of measures. The Ministry of Tourism has set up state-level committees comprised of representatives from trade associations and ministries to look into various aspects of tourism management. Tourism Minister Ambika Soni has also urged governments of various countries not to issue travel advisories against India, simultaneously sending out a message of reassurance to the world community that India is a “safe” destination.
To prevent the sector from plunging into further gloom, the Tourism Ministry is also working proactively with travel operators to revitalize inbound tourist traffic. As a part of the “promote India campaign”, for instance, tour operators have been asked to pair hotel tariffs with airfares and offer attractive incentives to visitors. Those who visit India this year will be offered sops like discounted packages for rural tourism, adventure tourism and wellness tourism on their next visit. Tour operators are also offering to sponsor at least 1,000 tourism industry reps to take a free trip to India for discussions.
Meanwhile, the ministry is working out the modalities of giving visas to tourists on arrival to further encourage unencumbered travel to India. It is also fleshing out 22 new mega tourism destinations across the country at an outlay of 250 million rupees (US$5.1 million) to 1 billion rupees for each destination, to infuse novelty into visitors’ itineraries. To give rural tourism a push, 130 more villages have been identified as templates to showcase India’s heterogeneous culture. Financial support to tour operators promoting India in the international arena has also been ratcheted up.
The government would do well to fire on all cylinders, considering that after the Mumbai massacre group bookings to popular tourist destinations like Goa, Jaipur and Kerala have plummeted remarkably. “The meltdown mayhem coupled with Mumbai’s terror attacks have severely impacted Indian tourism,” said Subhash Goyal, erstwhile president of Indian Association of Tour Operators. “It has had a cascading effect down the hospitality chain – from travel agents to the airlines to car rental companies to the hotels.”
Five-star hotel tariffs in Delhi have hit an all-time low. A room can now be had in the range of 8,000 rupees to 10,000 rupees, even though the same room fetched between 12,000 to 15,000 rupees last year. Ergo, to create demand, many hotels and resorts are offering a “Global Meltdown Tariff” which knocks off 30% off the normal fare.
However, despite a raft of measures taken by the government and the hospitality sector to rejuvenate inbound tourism, industry players are still a tad wary about the Christmas-New Year season, which accounts for the bulk of their annual business.
“Ironically, this is the time when trade is [usually] booming,” said Prateek Ghai of Globe Travels, a New-Delhi based travel agency. “But this time, due to a combination of factors, things are looking far too bleak!”