Tourism at crossroads

Adventure. Heritage. Wildlife. Cost-effective healthcare.

business Updated: Oct 22, 2010 20:48 IST

Adventure. Heritage. Wildlife. Cost-effective healthcare.

From jungle lodges to Ayurvedic massages, from tiger trips to hang gliding, India is eyeing a new future in tourism.

And not just for dollars anymore.

As the economy grows at 8 per cent and middle class Indians hunt for exotic holidays and unwinding opportunities, be it for weekends or long summers, the promise has never been as great as it has been for India.

“God’s Own Country” — Kerala, and the orchids of Sikkim are matched by heart surgery carried out in Bangalore or an eye surgery in Chennai. The variety and the opportunity are breathtaking and yet, India has a long way to go.

It is still only a fringe player on the global tourism circuit, with a mere 0.58 per cent share of international tourist arrivals, which the country expects to double its share to around 1 per cent by 2020. In absolute numbers it means close to 16 million tourists, strongly up from 5.1 million in 2009.

With 35,000 hotel rooms expected to be added over the next four years, and roads, airports and promotions on the rise, things could get better.

“We earned $9 billion last year through the sector and the numbers will grow much more but favourable conditions need to be created. We only need to promote our self,” said S.M. Shervani president Hotel & Restaurant Association of Northern India.

But that reveals only part of the story.

Consider this: India has only 120,000 hotel rooms in all inspite of its huge size, which is far less than even city zones such as Las Vegas, Dubai and Bangkok.

“The shortage of hotel rooms leads to higher room rates that adversely affects our competitiveness and deters tourists from planning a visit to the country,” said P.R.Srinivas, leader, travel, hospitality & tourism, at consultancy Deloitte India.

Sudeep Jain, vice president at consultancy firm Jones Lang LaSalle Hotels said that lack of infrastructure status to the industry means debt at higher rates for developers of hotels.

The recent Commonwealth Games in Delhi failed to deliver tourists despite the build-up, showing that hotel rooms alone are not the issue.

“The fact remains that tourist arrivals did not materialise as expected and bookings were at an all time low. Otherwise, October is a vacation month and industry celebrates the month," explained Shervani, underlining the irony of the situation.

Even Indians who travel abroad far outnumber the influx of tourists in India.

Around 8 million Indians go abroad and 5 million come into the country. In 2008, 10 million foreign tourists were targeted and the hospitality industry actually faced a shortfall of 130,000 rooms in all categories across India. In Delhi and NCR alone there was a shortfall of 40,000 hotel rooms.

“As compared with other Asian countries like Thailand India still is looked upon as a costly destination,” said Srinivas. Despite this, medical tourism, religious tourism, heritage tours and adventure packages were growing in India, though on a small base, he said. Industry officials say even domestic tourists who travel abroad can be wooed to stay back and tour within India if the industry gets its act together. For instance, in the US, as much as 87 per cent of the tourist traffic is domestic.

First Published: Oct 22, 2010 20:46 IST