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Incredible India: Is it losing the momentum?

Wednesday, December 11, 2019, 16:36 Hrs  [IST]

While the government and the policy-makers try to sell a fabulous growth story of Incredible India and international tourism into India, the trade and industry associated with tourism in India has a different story to tell. The private industry stakeholders who sell Destination India to their overseas customers admit a declining demand for India as a destination in key source markets. While they differ in key factors pulling down the numbers, all of them unitedly ask for urgent measures on the part of the government to interfere and take some remedial measures before the ground is fully lost. Hospitality Biz speaks to leading lights of the Indian travel industry to understand the prevailing sentiment…

Indian tour operators, especially those who are largely dealing in international inbound, are a stressed lot today. Although inbound season has started there is a total lull in the market. Business is not only down for now, there is not big hope going ahead as well. 'Times are really bad. It's frustrating as I am struggling to meet my establishment cost like salaries,' summed up quickly the situation by a known tour operator during a chat at a PATA India event recently in Delhi.

Nothing seems to be going in favour of Destination India, if travel and tourism industry is to be believed. Yes, there are people who challenge these conventional industry views citing the changes that has come into the way people travel in the technology age. However, the sentiments of the conventional tour operators cannot be swept totally under the carpet, if one looks at the inbound figures put out by the government and its statisticians. The gradual slide in inbound growth quite evident. The overall growth in Foreign Tourist Arrival (FTA) for India between January and October, 2019 was less than 3%, 2.7% to be precise.

"There is no demand for India as a destination in Europe. It's not the case of one country, but across Europe. This is a concern for all of us," said bluntly a Senior Sales official of a leading inbound company of the country at a PATA India meeting attended by a senior Tourism Ministry official. Others joined the chorus afterwards.

What is the reason for the drop?
Although Ministry of Tourism and its officials does not buy this industry views and dubs it as "anecdotal", the industry cites several reasons behind this sudden disinterest in India as a tourist destination. One of the major reasons being cities is the "perception" deficit that India suffers. That even, the Tourism Authorities of India concedes openly. The Tourism Minister himself had admitted that what India tourism requires is not resources but an image makeover or change in perception.

From the government to the industry put the blame on media for negative publicity for this image deficit. But what have they done to change that? Simply nothing? Issues like women safety, pollution issue in Delhi, the safety and security concerns after the abrogation of Article 370 in J&K and travel advisories being announced by countries, etc. have all been cited for the current dip in tourist arrivals.

"The demand is quite low," says Mandip Singh Soin, Founder & Managing Director of Ibex Expeditions. The travel advisories by countries in the wake of J&K incidents went against India, and also the negative publicity due to the pollution in Delhi. "While Europeans are resilient to certain extent, Americans are quite insular," he added.

"Yes, we had a bad Press, agreed. But there was zero counter PR activity by Indiatourism to counter it. There was zero reaction to the news on pollution in the international media. Similarly, there is very little global marketing activity on India," informs Rajeev Kohli, Joint Managing Director, Creative Travel.

"India is definitely a lot of business due to bad publicity," agrees Rajesh Mudgill, MD of Planet India Travel and Secretary of Indian Association of Tour Operators (IATO). "We need to do a lot of introspection," he added.

However, there are people who attribute the current dip to the overall slow down in the global market and dire economic situation in most of the European markets. "The state of the global economy itself is a big challenge. The European economies are weak and challenged. High end travel India is still on top. India continues to enjoy an edge in Wildlife, Heritage and Spiritual Tourism and that remains," said Vikram Madhok, MD, Abercrombie & Kent. But, Madhok also felt there is lack of required penetration in terms of promotion and marketing to salvage the situation.

There were many misadventures by government in recent years which actually led to the backlash. The GST was a real killer for Indian tourism because of the 28% tax component on luxury hotels. Although the government corrected the mistake of late, it has come too late for the trade and industry to leverage for the season in front. When 60% of the package component is hotel stay, the 28% GST didn't help the cause of India at all. As overseas tour operators prepare their brochures one to two years in advance, the recent reduction in GST would not result in immediate benefit.

Even the closing of Indiatourism Offices abroad and delaying key appointments of decision makers to those offices by the government made matters worse for India and its destination marketing efforts, experts opined. "When the offices closed down, there was no Plan B in place. They should have put in alternate system in place for PR and Marketing simultaneously. That didn't happen," an operator said. These kinds of misadventures led to many India-friendly

tour operators in overseas markets dropping Destination India from their brochures, for lack of support, he said.

Lack of Innovation:
People associated with travel and tourism industry in the country also point out lack of innovation in terms of products and services for the current peril. While competing destinations have marched ahead miles, India continues to lurk around the same old Golden Triangle, Spirituality, Heritage, etc. Even the trade in India is not showing inclination to innovate. "India has become very uninspiring tourism product. We haven't changed in the last 10 years," says Kohli. "Even the trade here shows no enthusiasm to innovate; rather they are happy selling on price," he blamed.

As per reports, India's foreign exchange earnings through tourism declined in the first half of this year with a muted growth in the number of India-bound tourists, compared to the year-ago period.

Foreign exchange earnings from tourism stood at USD 16.757 billion between January and July 2019, as against USD 17.059 billion in the corresponding period last year, posting a -1.8% growth vis-à-vis a 12.1% surge last year. The decline in growth in forex earnings from tourism.

Recent studies have shown a declining trend as far as India's share of international travel from its key source markets. Although there has been marginal growth in terms of actual number of travellers, in terms of the total share of the pie, India is gradually losing the grip.

In the highly competitive global tourism market place, destinations cannot afford to rest on past laurels any more. Destination managers have to continuously involve and engage the consumers to remain relevant and catch the eyeballs.

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