India’s Tourism Sector: Achievements and the Road Ahead

According to a recent report by the World Economic Forum (WEF), India has achieved the 52nd rank among the list of 141 countries worldwide as per the Travel & Tourism Competitiveness Index (TTCI) 2015. It is also a great achievement that the country has moved up 13 notches to the 52nd position as compared to 2013.

Top 10 Countries

Spain
France
Germany
US
UK
Switzerland
Australia
Italy
Japan
Canada

Emerging Countries

China (17th)
Brazil (28th)
Russia (45th)
South Africa (48th)
India (52nd)

This shows that though India has improved to a great extent, its position is still not better than its emerging market peers like China, Brazil, Russia and South Africa. India has still a long way to go.

Major Achievements

Market

In 2014, International tourist arrivals in India reached a record 1.14 billion, which is 51 million more than in 2013. Inbound tourism has been showing remarkable improvement in recent years.

This has also led to a growth trend in Foreign Exchange Earnings (FEE).

In November 2014, India expanded the visa-on-arrival scheme from 12 countries to 43 countries. It is in process of rolling out for 150 countries.

Hospitality, a major segment of tourism, has grown by 10-15 per cent in 2015 with the change in Government.

The tourism sector is among the top 15 sectors in India to attract the highest foreign direct investment (FDI).

Employment In 2014, the tourism industry contributed Rs. 7.64 trillion and 36.7 million jobs to the Indian economy. By the end of 2015, this sector will contribute 7% of India’s GDP and almost 9% of total employment. Investments

Many companies, both domestic and international, have invested in India’s tourism sector in the last two years like US-based Vantage Hospitality Group and Lalit Suri Hospitality Group.

The Thai firm Onyx Hospitality and Kingsbridge firm have set up a joint venture to open 7 hotels in the country by 2018.

Goldman Sachs, New-York based multinational investment banking fund, has invested Rs 255 crore in Vatika Hotels.

ITC is planning to invest about Rs 9,000 crore in the next few years to expand its hotel portfolio to 150 hotels.

Government Initiatives in 2014-2015

The Government of India has set aside Rs. 500 crore for the first phase of the National Heritage City Development and Augmentation Yojana (HRIDAY). The cities covered in the first phase Varanasi, Amritsar, Ajmer, Mathura, Gaya, Kanchipuram, Velankanni, Badami, Amaravati, Warangal, Puri and Dwarka.

The Government has launched ‘Project Mausam’ which proposes to establish cross cultural linkages and to revive historic cultural and economic ties with 39 Indian Ocean countries.

There will be a memorandum of understanding (MoU) between India and Oman for strengthening cooperation in tourism.

Rs. 100 crore has been allocated for National Mission on Pilgrimage Rejuvenations and Spiritual Augmentation Drive (PRASAD).

Rs.100 Cr allocated for reconstruction of damaged tourism infrastructure in J&K by the tourism ministry.

The National Guidelines for safety and security of tourists has been formulated.

Ministry of Tourism has tied-up with Ecole Hotelier de Lausanne, Switzerland, the first phase of which has already started, for improving quality of Hospitality Education.

In August 2014, a Comprehensive Sustainable Tourism Criteria for India has been launched in India for three important sectors - Accommodation, Tour Operators and Beaches, Backwaters, Lakes & Rivers.

Major factors for the growth of tourists in India

Domestic tourists

Evolving lifestyle
Increase in the purchasing power of the middle class
Better roads connectivity

International tourists

Value for money
Many business-cum-pleasure destinations
Success in the Incredible India and other marketing campaigns
Reforms in the aviation sector
Visa on arrival
Foreign Direct Investments

Types of Tourism in India

Due to its vastness and diversity, India offers various tourism options such as:

Rural Tourism
Cruise Tourism
Adventure Tourism
Leisure Tourism
Eco Tourism
Wellness and Health Tourism

Major Gaps in India’s Tourism Sector

The tourism and competitiveness index was calculated on the basis of 14 major dimensions which revealed how sustainable economic and societal development can be achieved through the travel and tourism sector in many countries. In India, the major factors which have brought down the overall ranking are the infrastructural gaps in the following:

Tourism-specific infrastructure (109th)
Bad quality of roads
Health and hygiene (106th)
Information, Communications and Technology readiness (114th)
Unsettling safety and security situation
Impact of crime and violence (97th)
Environmental sustainability (139th)

Road Ahead: Prospects of India’s Tourism

India fares much better as a business destination due to its economic growth. It still remains a highly price-competitive destination. The recent changes in its visa regime with the introduction of visa on arrival can lead to a great boost in the international arrivals. This sector has emerged as one of the key drivers of growth in India. The tourism industry in India is an important employment generator and an important source of foreign exchange for the country. It has a huge growth potential. India has great potential to benefit from the reforms and infrastructural growth initiatives undertaken by the new government. The major concerned areas like as health and hygiene, security and safety of tourists should be given more emphasis in the coming years. India is projected to be number one for growth in the wellness tourism sector in the next five years. There are large areas which need to be tapped from the tourist point of view. The growth and development of the tourism industry should be made more and more environmental friendly. According to the World Travel and Tourism Council (WTTC), Indian tourism will be one of the most rapidly growing industries in the next few years. Read Also: Slum Tourism in India Wildlife Tourism in India