Tourism Industry welcomes relief measures announced by the government, albeit cautiously

The relief measures announced by the finance ministry have gotten a mixed response from the tourism industry. Although the measures are welcomed for an industry severely impacted in the past 18 months, experts feel much more needs to be done to revive the sector.

Tourism Industry welcomes relief measures announced by the government, albeit cautiously

While the tourism industry broadly welcomes the relief measures announced by the finance ministry, they believe a lot more needs to be done to revive tourism.

Arvind Singh, Tourism Secretary, stated that the tourism and finance ministries are in contact with the industry and believe the measures are steps in the right direction. “Short as well as long term relief is definitely required in the sector. The measures will provide relief to tour operators and guides, with the free visa scheme providing an impetus to travel,” he said.

The relief measures announced include working capital with 100% assurance, up to Rs.10 lakh, for recognized travel and tourism stakeholders (TTS) and Rs.1 lakh for licensed guides, targeting 904 TTS and 10,700 guides; issuance of 5 lakh free visas, with the scheme relevant till March 31, 2022, or until the exhaustion of the free visas, whichever is earlier.

Rajeev Kohli, Joint Managing Director of Creative Travel, a company specialising in an inbound journey, believes the measures are a bit like 'smoke and mirrors’. Kohli stated, “The measures announced by the finance minister are substantive in nature. With the tourism industry accounting for a large part of the GDP and employment of the country, the authorities deemed it fit to announce Rs.300 crore investment to resolve the 18 months of downfall. Rs.10 lakh loan is useful for small-time players, but not for the majority. The issuance of 5 lakh visas is an efficient gesture but is not enough. It'll take more than waiving $30-60 per traveller to woo foreign tourists to India."

Rajiv Mehra, president of the Indian Association of Tour Operators (IATO) stated, although he is grateful to the ministry for granting relief to the industry, he hoped that e-tourist visas would be available soon and that the government might consider giving all recognised tour operators a one-time monetary grant, in addition to releasing the pending 2019-20 Service Exports from India Scheme (SEIS) benefits. The tourism industry receives SEIS benefits based on its international exchange earnings under the foreign trade policy, and these funds are used for promotions, advertising, and packages to attract more international visitors.

According to MP Bezbaruah, secretary-general of the Hotel Association of India (HAI), the finance minister's announcement on free visas sends a strong symbolic message that the country is confident in welcoming visitors and that tourism and hospitality are important pillars of the post-Covid financial recovery strategy.

While the visa waiver scheme would incentivize international vacationer arrivals to some extent, Vinutaa S, assistant vice chairman and sector head for company sector rankings at funding data and ranking company ICRA, stated that the Covid-19 containment and the restoration of international vacationer arrivals would primarily depend on the Covid-19 containment and vaccine rollout

Vinutaa S, assistant vice chairman and sector head for company sector rankings at funding data and ranking company ICRA stated whereas the visa scheme on waiving off the payment for the 5 lakh vacationer visas would incentivize international vacationer arrivals to an extent, the restoration in international vacationers coming into India would primarily depend upon the Covid-19 containment and the speed of vaccine rollout.

Some tour guides have expressed their displeasure with the tourism ministry's recognition of only Rs 1 lakh in mortgage disbursement limits for tour guides, as well as the high-interest rates on such loans, claiming that the authorities were looking for a chance in a catastrophe.

Source: Economic Times