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High hotel rates bigger deterrent than terrorism

business Updated: Mar 16, 2009 23:27 IST
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Prohibitive hotel rates and not the fear of terrorist attacks are keeping recession-hit tourists away from India, say European tour operators who were expecting Indian hotels to reduce their prices after last year's Mumbai carnage and the global economic meltdown.

"People tend to have short memory and many may have even forgotten the tragic incidents of November 26, 2008 in Mumbai. But hotel rates continue to deter people from visiting India, particularly when the mood in Europe is to guard against any unnecessary expense in the economic downturn," said Klaus Rinner, a Vienna-based tour operator.

He was here to attended the March 11-15 International Tourism Bourse (ITB).

Sunil Sikka, head of marketing and business development of the New Delhi-based WelcomHeritage hotels, attributed the high hotel prices to the supply-and-demand situation in the country.

"India badly needs hotel rooms. There is great disparity between the low supply and high demand. I believe the root cause of the declining numbers of tourists to India is to be found in the economic crisis, which has made travellers very price conscious," Sikka said.

Tourism secretary Surjit Bannerjee invited tourists to visit the country, claiming foreign tourist arrivals rose to 5.37 million in 2008, over 5.08 million the year before.

However, much of the increase took place in the first half of the year, before the economic crisis deepened. The second half saw The pace of tourism flow to India had considerably slowed down by the year end.

The operators here seemed unimpressed by what they described as "very small incentives with too many complex conditions attached".

Hans Koehler, the tours manager of Mercury Travels, said incentives were "highly impractical".

"You need a lawyer to interpret the complex fine print," he said.

The ticket price for the new Rajasthan Luxury Palace on Wheels was described as “outrageously high”. Usha Sharma, commissioner in the Rajasthan government's tourism department, said "We created the new train because the old train is overbooked and there is always demand.” But operators felt the prices demanded were beyond the reach of even rich people.