Forget for a moment the basic needs of safe environs, reliable power supply and efficient transport. Ask industrywallas why, despite being a proud third on the list of growth forecasts India ranks a pathetic 159th (out of 176) on the World Travel and Tourism Council’s list of relative contributions to the national economic output. The pointing finger would lead to unfriendly state policies. Ask them what is responsible for the lack of safety for the female tourist, and they would look at the usual suspect. Tourism is one of those industries where all wrongs can be laid at the government’s door.
“I have to be my own government,” says Patu Keswani, whose Lemon Tree Hotels is adding 14 properties to its existing seven. “I have to arrange a double power backup, arrange for transport for the staff, and maybe even work on a link road.”
It’s only when you get past this initial blame game that an unusual suspect comes up – the market itself. It seems that part of the reason why India is becoming increasing unsafe for the female tourist is the peculiar shape of the market being moulded by private enterprise.
Business travellers, who account for 40-60 per cent of foreign arrivals (depending on who hazards the guess), can charge their expense accounts and put up in a five-star. But what if it doesn’t agree with the wallet of the traveller who wants to avoid the grotty guesthouses on the backpack trail? Remember, the dodgy owners of such properties were the accused in many of the recent cases. What choice does such a tourist have?
“Nowhere,” says Arup Sen, executive director at Cox and Kings, one of the largest tour operators in the country. “Given the high realty prices – more than half the project cost in metros — it makes economic sense for the developer to build a topline property and charge five-star rates rather than aim lower.”
As a result, “India has only five-stars and no-stars – and nothing in-between”, says Sant Singh Chatwal, whose 30,000-Manhattan-room Hampshire group has just opened a property in Hyderabad. Keswani, whose properties rank “a notch below five-stars”, nails the numbers: “In the US, the largest and the most mature market, the ratio of rooms in the deluxe, upscale and budget segments is 1:3:7. In India 60,000 of the 200,000-odd rooms in the organised sector are deluxe.”
It takes about $750,000 (almost Rs 3 crore) to set up a room in New York. The cost ranges Rs 1.25-2 crore in an Indian metro, reckons Sanjeev Sethi, a CII deputy director and who stepped down as assistant secretary-general at the FHRAI (Federation of Hotel and Restaurant Owners’ Association) in 2006.
Amitabh Kant, who as Union tourism secretary between 2001 and 2007 championed the Rs 100-crore-a-year Incredible India campaign to stanch the post-9/11 slide, says, “The imbalance increases because of the low floor area ratio. Currently, a ratio of one is allowed in Mumbai. Though it will possibly be raised to 4.5 soon, compare it with 20-30 per cent in New York.”
What are the most important things needed to deliver a safe and cheap India experience? Kant rattles off steadily: “Ensure quality experience on ground, build airport and hotel infrastructure near entry points, push states to take tourism more seriously, and extend the Atithi Deva Bhava awareness and sensitisation campaign at home.” And adopt a longer-term, demand-based approach when building properties, we would add.