Tourism Project

Role of Tourism Industry in Generating Foreign Exchange
Chapter 1 INTRODUCTION
1.Introduction
1.1What is foreign exchange?
Where money from one country is exchanged for that of another. The s ystem by which one currency is exchanged for another; enables
international transactions to take place. The Indian foreign exchange reserve position continues to be buoyant with reserves standing at US$1,35,658 million in the week ending Feb 25,2005.
Foreign currency assets were US $ 129844 million, US $ 2,692 higher than previous week's figure. Compared to their last year figure this variation is of the amount US $ 22,699 million, RBI weekl y statement reported. Exchange reserves have continued to rise for over some months except for week ended Feb 5, 2005, when it fell marginall y to Us $ 1,28, 914 million from previous wee k's US $ 1,29,720 million .
In tourism, when a foreign tourist spends even a rupee, that is considered as a foreign exchange earning for the country.
1.2History on Tourism.
The first nomad, who wandered with his movable dwelling in search of food and shelte r from one place to another, must have been struck by the variations of ecology. This must have been a pleasant experience for him. The shift from unintended pleasure out of travel to traveling exclusivel y for pleasure constitutes the history of tourism, w hich is closel y related to mans economic growth, cultural and political development. Once the man had settled on the land or found a place under the sun, which he called home, movement from that to any other place brought out the meaning of travel into the open.
1.3 On Tourism Industry
Tourism is the largest export industry in the world. International tourism is the largest single item in the worlds foreign trade and for some countries it is already the most important export industry and earner of foreign exchange. The impact of tourism on national economies is becoming increasingl y important today because of the growing size of the tourist market. It is recognized so by the World Bank and the World Tourism Organisation. 27 September has been earmar ked as World Tourism Day. Tourism is the worlds largest export industry today. According to World Tourism Organisation international tourist traffic in 1997 was 613 million which generated receipts of about US$444.0 billion. It is estimated that tourism accounts for about 8 percent of the total world exports and more than 30 percent of international trade in services. It is also estimated that travel and tourism provide employment to 212 million peoples directl y or indirectl y accounting for about 10.7 per cent global work force.
The travel and tourism sector creates more jobs per million rupees of investment than any other sector of the econom y and is capable of providing employment to a wide spectrum of seekers from the unskilled to the specialized, even in the remote parts of the country.
Chapter 2 World Tourism
2. World Tourism
According to the preliminary result of World Tourism Organisation the number of foreign tourist arrivals in 2005 has increased by 5.5%. This growth in 2005 was preceded by the growth of around 10% in 2004. For the first time in year 2005 the number of foreign tourist arrival has crossed 800 million mark (808 million) from 766 million in the year 2004. Though this growth is not great compared to previous year, it is still above the long term annual growth rate of 4.5%. The Asia Pacific regi on experienced growth of around 7%S with Indias tourism growing at around 13%. This growth in world tourism is expected to slow down on 2006, around one percentage point, but still remaining above the industry average. There has been a global tourism boo m in recent times. International tourism has been performing better than world trade. Tourism receipts have registered a higher growth than that of world export in services and merchandise exports. The world tourist traffic increased by 3 per cent during 1997 and the regions which benefited the most were Africa with an increase of 9.2 per cent and South Asia with a growth of about 4.9 per cent. It is projected that the international tourist traffic will increase to about 1602 million by registering a growth of about 4.3 per cent during the period upto 2020. The South Asia Region including India is expected to record a higher growth of 6.1 per cent.
Fig 2.1: International Tourists Arrival In Millions
Fig 2.2:- Graph On International Tourists Arrivals
Fig 2.3 :- Graph On International Tourism Receipts
Fig 2.4 :- International Tourism Receipts In Billions US $
2.1 World Tourism Organisations Vision 2020:
The World Tourism Organisation, the apex body has tourism few years back predicted that US$ 2000 billion will be generated by the industry within the year 2020 (Bezbarua, 1999) . It has anal ysed the emerging trends and factors, which will influence the future growth pattern of the industry. Some of the important observations of WTO are summarized below. By 2020, there will be 1.6 billion international tourist arrivals and tourism receipts will rise to a staggering US$2000 billion, globall y. There will be sustained average annual growth rate of 4.3% (for arrivals) and 6.7% (for receipt s) throughout the world till 2020. In spite of this growth onl y 7% of the worlds population will become potential tourists. Thus according to WTO the industry would be still in infancy even in the year 2020. The top 10 tourist receiving countries would undergo major changes and China would be receiving maximum number of tourists (estimated to be 137.1 million with a market share of 8.6%) by 2020. Traditional market leader, France would come down to the third p osition. China will have an average growth rate of 8.0%in tourist arrivals during the period 1995 -2020. There will be changes in the top tourist originating countries. Japan, China, and Russian Federation will emerge as the new major outbound tourist coun tries. Though Europe will remain the largest tourist -receiving
region, its share will come down to 45% from the present 59%. South Asia will grow at a rate of 6.1% per annum during the period but its share will grow onl y up to 1.2% from the present 0.7%.
Chapter 3 Tourism Industry in India
3. Tourism Industry in India

The present day tourism, if we take in India with the billion people. With the vast civilization heritage of the country, from the Himalayas to Kanyakumari, J& K,
10
Central India, North Eastern states, Bihar, Western States, the large coastal line, Andaman Nicobar and Lakshadweep Islands have a lot to attract the tourist. It has sea coast in three sides, it has islands. It has snow covered hill region, it has deser t and it has thick forest regions. All of them are of natural evolution. Many centuries old monuments, temples, churches and mosques are spread thoughout the country. You will find in many parts of the country all three situated adjacent to each other. It is a treat to watch such type of unity. India has one if the Seven Wonders of the World, Taj Mahal. Any tourist can see the continuity of the enriched civilization of billion people of the largest democracy with multiple religions, multiple languages, and multiple cultures. Extracts from the Address of President of India at the Inauguration of the 5th Global Travel & Tourism Summit in New Delhi on 8th April 2005.
India the land to travel to, a haven of tourism delights, a civilization to tour through. Tourists come to India for its wealth of sights, cultural exuberance, diversity of terrain and in search of that special something, an extra punch that only India promises and delivers. Teeming with over a billion people who voice over a million concerns in fifteen hundred different languages, India is where people live with variet y, thrive on diversit y and are too familiar with largeness to let it boggle them. Mud huts and mansions face off across cit y streets. Lurid luxury and limp living are inhabitants of the same lane. From the smoky mangroves of the Sunderbans to the steaming Thar Desert, sizzling cities like Mumbai and Delhi to the scintillating villages of Khajuraho and Hampi, from the heights of the Himalayas to the deep blue waters around the Anda mans, India is a travel haven a tour package that frustrates and delights, as demanding as it is rewarding. It demands that the traveller be prepared for its own strange forms of tourism offerings - the crowds at Pushkar, for pushy mendicants at Haridwar , for high
commercialism at spiritual retreats. But equall y, it means that he be prepared for an overwhelming warmth in the people, ease of conversation,
11
and to be stunned into speechlessness by the beaut y, sometimes the manmade and often the natural. India is a country known for its lavish treatment to all visitors, no matter where they come from. Its visitor -friendly traditions, varied life st yles and cultural heritage and colourful fairs and festivals held abiding attractions for the tourists. The othe r attractions include beautiful beaches, forests and wild life and landscapes for eco -tourism, snow, river and mountain peaks for adventure tourism, technological parks and science museums for science tourism; centres of pilgrimage for spiritual tourism; h eritage trains and hotels for heritage tourism. Yoga, ayurveda and natural health resorts also attract tourists. The Indian handicrafts particularl y, jewellery, carpets, leather goods, ivory and brass work are the main shopping items of foreign tourists. The estimates available through surveys indicate that nearl y fort y per cent of the tourist expenditure on shopping is spent on such items. India has significant potential for becoming a major global tourist destination. The country witnessed foreign touri st arrivals of 2.75 million in 2001. Travel and tourism is the second highest foreign exchange earner for India, and the government has given organisations in this industry export house status. The industry is waking up to the potential of domestic tourism as well, with an estimated 4.7 billion domestic trips in 2001. Tourism spending within India in 2001 was US$ 22 billion. There is considerable government presence in the travel and tourism industry. Each state has a tourism corporation, which t ypically ru ns a chain of hotels /motels and operates package tours, while the central government runs the India Tourism Development Corporation.
12
Divestment of these state -run tourism corporations have either already taken place or are in process. Incoming foreign tou rist arrivals have shown a 6% compounded annual growth rate over the last 10 years. The government has realised the potential and has advanced several incentives to promote infrastructure growth in the tourism sector. Current investments are likel y to see hotel room capacit y increase by 20% over the next three years, with several international hotel chains entering th e hotel industry. Similar growth is anticipated in air travel capacit y. Fig 3.1:- Foreign Tourists Arrival To India
Indias tourism crossed 3 million mark (3.37 million) in number of arrivals of foreign tourist in the year 2004, showing a remarkable growth of 24% over the previous year. The number if foreign tourist arrivals in 2004, 3.37
13
million, in India formed 0.44% of total worlds foreig n tourist arrivals. The foreign exchange earnings have also grown by 38% to US$ 4810. This growth when compared to world tourism increase of onl y 10% for the same year is remarkable. This remarkable growth in foreign tourist arrival is also visible in domestic tourism. The domestic tourist arrival in India crossed 300 million mark (309 million) in the year 2003 and reached 367.6 million in year 2004. The total contribution of this sector, direct and indirect, to Indian GDP is around 5.83%.
Fig 3.2:- Foreign Tourists Arrival During Jan -Jul 2003 to 2005
This sector is directly and indirectl y linked to many other sectors in the econom y. A growth in tourism industry affects industries like handicrafts,
14
handlooms, transportation (mainl y aviation), real estate (or infrastructure) and many more. One of the major sectors to which tourism is linked to is Real Estate. Both these sectors act complementary sectors to each other. More the number of tourist arrivals, more is the requirement if better infrastructure, hotels, restaurants, houses etc. The point to be noted over here is that this real sector is not a stand alone sector. It is further linked to more than 200 different sectors like cement, steel, glass, electrical, water suppl y, carpentry, transportation and many more. Another major aspect of tourism industry is the employment opportunities attached to it. Tourism industry is the largest employer on the world. In India, the direct employment from tourism contributes to 4.59% of the total employment in the coun try. Adding the indirect employment to it, the figure goes up to 8.27% i.e. the total employment generated by the industr y in India id around 40million. Also, 50% of this employment is indirect. This means that the growth in this industry has a strong impa ct on the employment in other industries also.
Fig.3.3 :-Foreign Exchange From Tourism (in Cr.)
15
Fig 3.4 :- Foreign Exchange Earnings Through Tourism
16
Fig 3.5 :- Graphical Representation of Foreign Exchange Earnings
17
Chapter 4 Global Status & Trends
4. Global Status & Trends
18
Although global recession and the September 11, 2001, events are estimated to have resulted in a temporary decline in travel and tourism demand in 2001 -02, international and domestic tourism is expected to boom over the next two decades. The World Travel and Tourism Council (WTTC) estimates a 4.5 percent per annum increase in the total amount of travel and tourism economic activit y between 2003 and 2012. This is largel y attributed to a rise in gl obal wealth, liberalization of international airspace, cheaper flights and the use of the Internet as a travel tool. The earnings from tourism have made it one if the worlds largest industries and the fastest growing sectors of global trade accounting for 10.7% of global gross domestic product(GDP), 12.8% of global exports, 8.2% of global employment (0r one in every 12.2 jobs). And 9.4 % of global capital investment. Tourism in the least developed countries is growing faster than the world average, holding the promise of prosperity for many; International tourist arrivals worldwide reached 698 million in 2000, generating $595 billion revenues. International tourism flows are expected to reach 1.5 billion b y 2020 and revenue estimated to cross $2000 billion. Today, only 3.5 percent of the world population travels internationall y but the number if Asian, particularl y Chinese. Tourist is predicted to grow enormousl y as the region becomes more integrated with the global econom y. The scale of world domestic touris m, on the other hand, exceeds world international tourism by a ratio of 10:1. In India, for every international tourist, there are 80 domestic tourists. Domestic tourism can form the basis of a viable and sustainable tourism industry in India.
19
Chapter 5 Global Market Trends
5. Global Market Trends
20
Consumer trends in tourism are graduall y changing and require an appropriate response in terms of both policy formulation and investment. Current market trends indicate that: Long haul travel will grow faster than intra -regional travel. A growth of 24 percent is expected by 2020. People with less time for leisure are likely to take more frequent but shorter trips nearer home, opening up opportunities for neighbouring country tourism. The experienced traveler wants authentic, off -the-beaten-track
vacations in remote and less well -known places as against luxurious five-star vacations, leading to an interest in rural and ethnic tourism. The increase in the number if people with lots of money but little leisure time has resulted in a growing emphasis on rest and relaxation, and wellness and health holidays. The elderl y population in key tourism -generating markets has shown a preference for cultural tourism against sun -and-sand vacations. There is notable and increasing interest in spiritualism. The demand for eco-tourism and nature-based holidays is expected to double and even triple on the next 20 years. Sports and adventure holidays continue to be popular with the young. The interest in cultu ral tourism, spiritualism, wellness holidays, eco tourism and rural tourism would tend to favour India, provided the countr y can avail of the opportunities offered to maximize its natural advantages in these areas. The development of new tourism products and destinations during the Tenth Plan must be based on market research and demand, keeping the source markets and the age group of the tourists on mind.
21
Chapter 6 Indias Place in World Tourism.
6. Indias Place in World Tourism.
22
In Asia, China has emerged as a leading tourist destination and is poised to become the worlds top tourist destination by 2020. The WTTC has identified India as one of the worlds foremost tourist growth centres in coming decade. After Turkey, India is expected t o achieve the fastest growth of the total amount of economic activit y likel y to be generated by travel and tourism, at 9.7 percent over the next 10 years. Also, the largest employment creation in China is expected to take place in India over the same perio d. The growth in visitor exports or spending b y international tourists, is likel y to be fastest in India at 14.3 percent per annum over the next decade. On the whole, the WTTC forecast for India is promising, subject to key policy issues that affect the growth of the sector being addressed. If India is to realize its enormous potential in tourism it must provide exclusive world -class tourism products and destinations to compete
successfull y for a larger share of the Asian tourism market. Today, outbound tourism from India far exceeds visitor traffic to the country partl y because there is a lack of world -class destinations within the country and partl y because the domestic tourism policy has been largel y directed towards those in the lower end f the spendin g spectrum. The scope and reach of domestic tourism will have to be broadened in the Tenth Plan through the development of competitive destinations that match
international standards in terms of price and also satisfy the international traveler. Indias in ternational arrival figures have not been able to keep pace with neighbouring countries and have been exceeded by Thailand, Malaysia, Indonesia, Dubai and the Maldives. Since 1995, Indias share of the world market has remained virtually stagnant at 0.38 p ercent, while domestic tourism has grown at a phenomenal rate and India now accounts for 4.6 percent of domestic tourism worldwide. In terms of tourism receipts, India has shown relativel y buoyancy because handicrafts items and particularl y in diamonds. Th e Tenth Plan visualizes a mutuall y
23
supportive role of tourism and handicrafts by encouraging haats and shilpgrams and recognizing shopping as an integral part of tourism experience to promote the Made in India brand.
Fig 6.1 :- Share Of Top Ten Countrie s In International Tourists Arrival
Fig 6.2 :- Share Of Top Ten Countries In International Tourism Receipts During 2004
24
25
Chapter 7 Indias Tourist Profile
7. Indias Tourist Profile

India receives the largest number of overseas tourists from the United Kingdom, which is its largest source of market, followed by the United
26
States,
Sri
Lanka,
France,
Germany,
Canada,
Japan,
Australia
and
Singapore. Of the tourists coming to India. 27.5 percent are in the age group of 35-44 years, 23.4 percent in the age group of 25 -35 years and 20.8 percent in the age group of 45 -54 years. Women constitute onl y 30.5 percent of Indias total international arrivals. Repeat visitors account for 44.9 percent of the overseas visitors. A substantial number of these may be non-resident Indians, as hotel reservations do not correspond to the number of international arrivals in the country. The average length if stay of foreign tourists in the country in 1998 was 31.2 days. Domestic tourism, on the other hand, is largel y pilgrimage -oriented and requires improvement in travel facilities and pilgrim destinations. Fig 7.1:- Top Ten International Markets for India During 2004
27
Chapter 8 Domestic Tourism
8. Domestic Tourism
28
The potential of domestic tourism has grown substantiall y during the last few years. As per the figures reported by the State Governments, the
domestic tourist visits in the accommodation establishments during 1999 are roughl y estimated to be 176 million. An important feature of the
domestic tourism sector is its contribution to national integration and creation of a harmonious social and cultural environment.
The Committee notes that plan allocation for Domestic campaign during 1999-2000 and 2000 -2001 were decreased from Rs.4.50 crores to Rs.3.50 crores and from Rs.3.00 crores to Rs.2.00 crores respectively at the RE stage. Now during 2001 -2002 (BE), Rs.3.00 crores have been allocated for Domestic Campaign (including fairs and festivals and craft Melas).
When asked for the reasons for reduction of funds for domestic tourism at the RE stage, the Department of Tourism stated that the same was reduced on account of the additional expenditure envisaged for the Pacific Asia Travel Association (PATA) conference 2001. When asked why proper
attention has not been by paid to the domestic campaign, the Department of Tourism have replied that the Department is paying due attention to the Domestic Campaign with in the available resources also through release of advertisements in the local media, celebration of local festivals in different states and special exhibitions, etc. The amount allocated during 2000 -
2001 was allocated for launching of campaigns in Print Media on important decisions and release of advertisements. The Department was to launch
promotional campaigns on important events such as Sindhu Darshan, World Tourism Day, Baudh Mahotsav, etc. In addition to the above,
advertisements will also be released in local travel media and tourism supplements of newspapers, journals. It has also been stated that
advertising within the country for attracting domestic tourists is mainl y done by the States.
29
The Committee feels that domestic tourism is the ma instay of Indian Tourism. The Committee has been constrained to note that the Department of Tourism has not been giving proper attention to the Domestic Campaign. The reason stated by the Department of Tourism for reduction for allocation at the RE stage d uring 2000 -2001 is also not convincing. The
Committee recommends that greater attention be paid to the Domestic Tourism because it creates more jobs than any other sector for every rupee invested. It also creates the jobs at the local level, dispensing w ith the In fact,
need of migration to distant places for earning of livelihood. tourism plays a major role in promoting large -scale
employment
opportunities. Also, the vast number of domestic tourists visiting different parts of the country every year ret urn with a better understanding of the people living in the different regions of the country and the geographical, biological and cultural diversit y of India.
Multifarious fairs and festivals occur throughout the year and are an amalgam of Indias rich cultural heritage. They have added a new dimension to the Department of Tourisms promotional efforts. Financial assistance is given to various State Governments to promote specific fairs, financial assistance for is extended in the form of publicit y suppor t, publicit y material
particularl y
releasing
advertisements,
printing
relating to the fairs/festivals and also for creating semi/permanent assets. A small proportion of the outlay is proposed for special campaigns. These are launched from time to tim e based on actual needs and requirements of the market and would mostl y be in the nature of release of advertisements in trade journals as well as in general newspapers and magazines.
The Committee enquired as to what was the criteria/policy regarding distribution of amount earmarked for domestic publicit y between English and the regional/vernacular print media. The Committee was informed that at the moment there is no policy in this regard.
30
The Committee is surprised to know that at present there is no laid down policy with regard to the distribution of amount earmarked for domestic publicit y between English and the regional/vernacular print media. The
Committee feels that there must be some criteria regarding placement of advertisement in the print media. The Committee observes that India is a country of continental dimensions that includes diverse races, languages and religions. domestic The Committee recommends that allocation for funds for should be adequatel y distributed between the
campaign
English/regional print media so that people belonging to the various languages and the different sections/segments of the societ y become aware of the campaign launched by the Department of Tourism.
Fig 8.1 :- Domestic Tourist Visits
31
Fig 8.2 :- Graphical Representation of Domestic Tourist Visits
32
Fig 8.3 :- Share Of Top Ten States In Domestic Tourism During 2004
33
Chapter 9 Tourism In India (2004-2005)
Tourism In India (2004-2005)
34
9.1 India Tourism in 2004 The year 2004 has been a highl y successful year for India tourism. The foreign tourist arrival crossed the 3 million figure with arrivals estimated at 3.37 million. The foreign exchange earnings also recorded an unprecedented growth of abou t 38% with receipts at US$ 4810 million. The growth of about 24% in foreign tourist arrivals during 2004 was achieved over and above a growth of about 14% witnessed in the year 2003. This was achieved despite the fact that the world over, there was a decli ne of about 1.5% in tourist arrivals in 2003, and onl y a growth of 10.7% in 2004. This has been possible mainl y due to the attempts made by Government to: improve tourist infrastructure at important destinations/ circuits; focus attention on growth of hotel infrastructure, particularl y budget hotels; enhance the connectivit y through augmentation of air seat capacit y and improving road infrastructure to major tourist attractions; directl y approach consumers through electronic & print media through Incredible India campaign; create world class collaterals; launch centralized electronic media campaigns; have greater focus in the emerging markets, particularl y in the region of China, North East Asia and South East Asia; use internet and web connectivit y; launch road shows in big source markets of Europe.
The Indiatourism also continued to receive international acclaim when it won the Gold Award of the PATA in the travel advertisement print category and marketing award in 2004. The Ministry of Tourism als o won the 2005 PATA Grand Award in the Heritage category, for its Ajanta Ellora Conservation & Tourism Development Project and the PATA Gold Award in the Print Media category for its Incredible - Taj.
35
Fig 9.1.1 :- Foreign Tourists Arrival To India Dur ing 2003-2005
9.2 India Tourism In 2005 Foreign Tourist Arrival & Share of India in World Arrivals The year 2005 has been a highl y successful year so far as tourism in India is concerned. For the third successive year, India witnessed a positive growt h in foreign tourist arrivals, reaching a level of 3.92 million against 3.46 million during last year. The growth rate of 13.2% during 2005 was achieved over and above a growth of about 26.8% witnessed during the year 2004; and that the expected growth the world over during 2005 is estimated to be about 5 6% onl y. With this growth, the share of India in world tourism, which was hovering between 0.38% to 0.39% for number of years, is expected to be around 0.49%.
36
Fig 9.2.1 :- Foreign Exchange Earnings US $ During 2003-2005
Fig 9.2.2 :- Foreign Exchange Earnings In Crores During 2003 -2005
37
Chapter 10 Hotels/Accommodation.
10. Hotels/Accommodation.
38
Accommodation of qualit y is basic infrastructure for the development of Tourism. The Ministry of Tourism approves hotels from the point of view of their suitabilit y for international tourists. Various incentives and benefits are linked to such approvals. As on September, 1999 there were 1229 hotels with 68032 rooms and on the approved list of Ministry of Tourism. Break up of these hotels category wise is as below: Star Category 5-Star Deluxe 5-Star 4-Star Heritage Hotels 3-Star 2-Star 1-Star To be classified No. of Hotels 55 50 79 62 316 324 146 197 No. of Rooms 12948 6654 6131 1916 15590 11391 5059 8307
8.1 Efforts to Overcome Shortage of Accommodation In order to meet the rising demand of accommodation due to increased growth in tourist arrivals, Department of Tourism brought out guidelines for classification of Apartment Hotels, Time Share resorts and Guest Houses. The Department also sanctioned capital subsidy for 21 budget category hotels and interest subsidy for 160 budget category hotels during last two years. In all 276 hotels in different categories were classified and 230 hotels were re-classified. Approval was granted for 109 hotel projects with 7,206 rooms. In addition, 23 foreign technical collaboration in hotel industry and 9 cases of foreign investments we re cleared.
39
Chapter 11 Organisations Involved.
11. Organisations Involved.
40
The organisations involved in the development of tourism in India are the Ministry of Tourism and Culture with its 21 field offices within the country and 18 abroad, Indian Institute of Tourism and Travel Management, National Council for Hotel Management and Catering Technology, India Tourism Development Corporation, Indian Institute of Skiing and
Mountaineering and the National Institute of Water Sports for HR D development in the area of Tourism. Central Government Organisations Department of Tourism Indian Railway Catering and Tourism Corporation Li mited (IRCTC) Syama Prasad Mookerjee National Institute of Watersports (NIWS) State Government Organisations Chandigarh Industrial and Tourism Development C orporation (CITCO) Delhi Tourism and Transportation Development Corporation (DTTDC) Directorate of Information, Publicit y and Tourism, Andaman and Nicobar Himachal Pradesh Tourism Development Corporation Limited (HPTDC) Karnataka State Tourism Development Corporation (KSTDC) Kerala Tourism Development Corporation Limited (KTDC) Madhya Pradesh State Tourism Development Corporation Limited (MPSTDC) Maharashtra Tourism Development Corporation (MTDC) Meghalaya Tourism Development Corporation Limited
41
Patnitop Development Authorit y Punjab Tourism Development Corporation (PTDC) Rajasthan Tourism Development Corporation Limited (RT DC) Sun Temple, Konark Tamil Nadu Tourism Development Corporation (TTDC) Tourism and Civil Aviation Department, Himachal Pradesh Tourism Corporation of Gujarat Limited (TCGL) Tourism Department, Andhra Pradesh Tourism Department, Arunachal Pradesh Tourism Department, Chhattisgarh Tourism Department, Goa Tourism Department, Goa Tourism Department, Gujarat Tourism Department, Haryana Tourism Department, Jammu and Kashmir Tourism Department, Kerala Tourism Department, Nagaland Tourism Department, Orissa Tourism Department, Pondicherry Tourism Department, Uttar Pradesh Tourism Department, West Bengal
Others Institute of Hotel Management, Catering Technology and Applied Nutrition, Bangalore Institute of Hotel Management, Catering Technology and Applied Nutrition, Goa National Rail Museum (NRM) Palace on Wheels
ITDC:
42
In 1996 a public sector corporation was set up under the Ministry to pioneer the development tourism infrastructure speciall y hotels in the country. The present network of ITDC comprises 26 Ashok Group Hotels, 6 Joint Venture Hotels, 5 Restaurants, 11 Ashok Travel and Transport units, 29 Dut y Free Shops at 6 Airports and a Down -Town Dut y Free Shop in Delhi. The Government is activel y considering disinvestment of ITDC to ensure private participation. A radical turnaround has been recorded in ITDC from a turnover of Rs.184 crore with a net loss of over Rs.37 crore in 2001 -02, to a turnover of Rs.379.78 crore with a net profit of Rs.39.03 crore in 2005 -06. This includes total turnaround in flagship Ashok Hotel fro m a turnover of Rs.35 crore (Net loss of Rs.15.09 crore) in 2001 -02 to a turnover of Rs.93.03 crore (net profit of Rs.26.29 crore approx.) in 2005 -06.
43
Chapter 12 Strategy in the IX Plan.
12. Strategy in the IX Plan.
44
The basic strategy during the 9 t h Plan is to establish effective coordination with all the relevant agencies to as to achieve synergy in the development of tourism. For the 9 t h Plan period (1997 -2002), the Planning Commission has approved a Plan outlay of Rs. 793.75 crores for the Ministry of Tourism comprising Direct Budgetary Support of Rs. 485.75 crores and internal and external resources of Rs. 308.00 crores. Tourism development is a composite subject and does not necessaril y mean the development of onl y the tour ism facilities like hotels, restaurants, recreational activities etc. In fact, creation of tourism infrastructure will be meaningful onl y if the areas has the minimum basic amenities and infrastructure like roads, water, electricit y, sewerage and
telecommunication facilities. This aspect has given importance in the Tourism 'S ynergy' programme. The State Governments have been asked to prepare Master Plans for the development of tourism based on the same concept.
45
Chapter 13 Tenth Plan Objective.
13. Tenth Plan Objective.
46
Tourism in India has tended to be regarded as an elitist conducted primaril y for the purposes of earning foreign exchange. Its vast potential as an engine of growth and employment generator has remained largel y untapped. Although, with 25 million jobs, India ranks second in terms if number of persons employed in travel and tourism, yet the contribution of the sector as a percentage share if all employment is amongst the lowest in the world. The Tenth Plan objectiv es is to integrate with the socio economic objectives of the Plan by creating 3.6 million jobs a year through the promotion of domestic and international tourism and to enhance Indias share of international tourist arrivals from 0.38 percent to atleast 0. 62 percent by 2007. It will mobilize state governments to use tourism as a means for achieving their socio-economic objectives; encourage the private sector to enhance investment in tourism & provide legislative & regulatory support for sustainable tourism & to protect the interests of the industry & the consumer. The policy envisages involving the rural sector in the promotion of rural, heritage, adventure & eco tourism & will promote the
development of the competitive high qualit y products & destinations . Most importantl y it will remove the barriers to growth & resolve the
contradictions in policy to achieve inter -sectoral convergence of activities that help the growth of tourism.
47
Chapter 14 Indian Tourism Policy Initiatives
14. Indian Tourism Policy Initiatives
48
The Government of India came out with its first ever policy on tourism in 1982. the policy was of a more a statement of intention than a plan for development. It aimed at projecting India as the ultimate holiday
destination. The policy suggested granting export industry status to tourism, developing tourist circuits, developing a marketing campaign based in the country, and inviting private sector participation. Several legislative and executive measures followed the tourism poli cy. In 1987, the Tourism Development Finance Corporation was established with a corpus fund of Rs.1bn and lit disbursed loans at concessional rates for tourism-related projects. In 1988, the National Committee on Tourism set up by the Planning Commission submitted a perspective plan on the tourism industry. The committee recommended structural changes such as replacing the Department of Tourism with the Tourism Board. It suggested the creation of an exclusive cadre if the civil service -the Indian Tourism Service. It also recommended the partial privatization of the national carriers-Indian Airlines and Air India. The seventh five -year plan (1985 -86 to 1989-90) also spoke of the basic framework of operational initiatives vis--vis the tourism industry. The next major policy initiative came in May 1992 in the form of the National Action Plan for Tourism. The action plan contained several objectives, to increase the employment opportunities in the tourism industry; to develop domestic tourism for the budget travelers; to preserve the national heritage and the environment; and to diversify the Indian Tourism product. It aimed to increase Indias share of world tourism to 1% in a span of five years. The plan recommended the development of special tourism areas on the lines of export processing zones, improvement of pilgrimage centers with financial assistance from the central government, and the setting up of a National Culinary Institute. It also suggested the creation of a flexible system for the recognition o f travel agent and tour operators.
49
The eight five-year plan (1992-93 to 1996-97) spoke about attracting high spending tourists from Europe ant the US. It also suggested the creation of a master plan bky integrating area plans with tourism development. Th e other thrust areas in the plan included moving away from culture -related tourism to holiday and leisure, adventure, wildlife, etc. In May 2002, the National Tourism Policy was unveiled. This was essentiall y a rehash of earlier policy and plans. The 2002 policy was, however, ambitious in the sense that it recommended positioning India as a global brand to attract tourists in larger numbers and exploiting the vast potential of India as a tourist destination. In the same period in the form of opening of th e skies was introduced with the aim of international tourist arrivals by enhancing air seat capacit y and connectivit y. 14.1 Policy Initiatives The New Tourism Policy released in May 2002 has outlined the following policy initiatives for the tourism sector : The new policy is built around the 7 -S Mantra of Swaagat (welcome), Surakshaa Soochanaa (information), Suvidhaa (facilitation), (security), Sahyog (cooperation), Sanrachnaa
(infrastructure) and Safaai (cleanliness). The new policy envisages making tourism a catal yst in employment generation, wealth creation, development of remote and rural areas, environment preservation and social integration. The policy also aims to spruce up economic growth and promote Indias strengths as a tourism destination t hat is both safe and at the same time exciting. The policy proposes the inclusion of tourism in the concurrent list of the Constitution so as to enable both the central and state
governments to participate in the development of the sector.
50
No approval is r equired for foreign equit y of up to 51 per cent in tourism projects. Enhanced equit y is considered on a case -to-cas e basis. NR I investment is allowed up to 100%.
Approvals for Technology agreements in the hotel industry are available on an automatic basis, subject to the fulfillment of certain specified parameters.
Concession rates on customs dut y of 25% for goods that are required for initial setting up, or for substantial expansion of hotels. 50% of profits derived by hotels, travel agents and tour opera tors in foreign exchange are exempt from income tax. The remaining profits are also exempt if reinvested in a tourism related project.
Approved hotels are entitled to import essential goods relating to the hotel and tourism industry up to the value of 25% of the foreign exchange earned by them in the preceding licensing year. This limit for approved travel agents/tour operators is 10%.
Hotels located in locations other than the four major metro cities are entitled to 30% deduction from profit, for a ten -year period. The expenditure tax has been waived in respect of hotels located in the hills, rural areas, places of pilgrimage or specified place of tourist importance.
51
Chapter 15 Leakages
15. Leakages
Though the tourism industry is booming and helping both Indian and world economies to grow, there are a few downsides to this industry. A huge
52
seasonal employment exists in this sector. This seasonal employment is mainl y in developing countries where touri sm industry is not much developed. In these countries for a few months the tourism is low and comparativel y fewer workforces are required. In India, the months of April, May and June are low on foreign tourist arrivals. Apart from these employment issues, another limitation to the industry is leakage. The term Leakage means that out of the total amount of money spent on the tourism of a country, a major part leaks out of that country (mainl y developing) to the other countries (mainly developed). This leak age occurs when the host country wants to provide international facilities to their tourists. This leakage can be internal leakage or external leakage. Many times the tourists arriving the host country demand for the goods like some equipment, food, dr inks etc. which the host country cannot provide them. This leads to internal leakage because to fulfil the needs of tourists, the host country has to import these goods from other countries. External leakage occurs because; these host countries (mainl y dev eloping) might not have enough capital to build an infrastructure to attract foreign tourists, which calls for an investment from foreign countries (mainly developed). Now these external investors are a part of their business and will take a major part of there earnings. In India the leakage is around 40%, i.e. 40% of the earnings generated by Indias tourism leaks out of the country. This leakage is significantl y high and is a cause of worry. But, compared to other developing nations, this figure is still better. The average leakage of developing nations is around 80%, which is very high as compared to leakage in India. The reasons for this are the improving infrastructure of major tourist destinations, the escalation in international standard Indian hotels like TAJ Group of Hotels, ITC Welcome Group, Oberoi Hotels etc.
53
Chapter 16 Barriers to Growth
16. Barriers to Growth

There are several factors that are responsible for adequate growth of the tourism sector in India. These are :
54
Barriers related to approach Barriers that discourage private investment Factors that affect competitiveness. Factors that affect the long -term sustainability .
The effective & early removal of these barriers during the tenth plan is an essential determinant for the success of new tourism policy. 16.1 Approach -Related Barriers The need for a national consensus on the role & the level tourism development in the country has been voiced repeatedl y but a concerted effort to achieve a consensus has not been made. Tourism should be limited by state or regional boundaries if distortion in policies is to be avoided .It us important that the consensus among all states is evolved through the National Development Council (NDC) & the barriers to the growth of tourism removed. Tourism has been denied the priorit y it deserves over successive plan periods because its potential as a engine of economic growth has not been appreciated. This is visible in the low allocation of resources. Allocation to tourism has averaged 0.16% to the t otal plan outlay from the third plan to the ninth plan. In the Tenth Plan , it is likel y to receive an allocation of 0.72% .According to the WTTC , India is one of the lowest spendors of tourism-153 r d out of 160 countries , while its neighboring competitor s & China invest far more : Malaysia (5.1% ) , Nepal(5%), Indonesia (8.4%), Maldives (15.7%) , China (3.8%) . The growing domestic & international demand, which is set to boom, reinforces the need for higher investment. Failure to measure up to additional investment demand for domestic
tourism is likel y to lead to the over exploitation of existing facilities, discouraging foreign investors while leading to an increase in the outflow of high spending domestic tourists from the country.
55
Most state governme nt gives scant importance to tourism even though the y virtuall y control the tourism product located within their boundaries. They are responsible, inter -alia, for local infrastructure, transport system, sanitation & hygiene, leisure & recreation, law & or der, the upkeep of local monuments & the general well being of the tourist. Their support & participation is essential for tourism to succeed & spread its benefits among the host population. Their lack of interest has resulted in an unprofessional ad hoc a pproach that acts as a deterrent to the growth of tourism. The approach of the state governments need to be focused, highl y professional & result - oriented if India is to avail of the opportunit y that the currentl y favorable market trends have to offer. 16.2 Barriers That Discourage Private Investment Apart from the State Governments the private sectors plays a vital role in the growth & development of tourism. Although the central government & certain state governments have, from time to time, announced in centives to involve the private sector in tourism development, the results achieved have fallen\n short of expectations. To provide a conducive environment for private sector investment it is important to realize that the travel & tourism sector is adverse l y affected by the lack of synergy in inter -sectoral policies. The growth of the sector requires well integrated & coordinated policies & stabilit y & approach. Contradictions & arbitrary changes in policy send confused signals to the investor. Unless infir mities in policy are expeditiousl y removed well before the end of the Tenth Plan period the new tourism policy is unlikel y to succeed. 16.3 Factors that Affect Competitiveness Being a long haul destination, India is more convenientl y accessible by air and cannot be easily reached by rail or road. A restrictive air transport policy has a very deleterious effect on tourist traffic. There are insufficient
56
connections to most tourism destinations. The situation could be eased if the large number of regional air ports could open up as international airports. The existing international and national airports also require improvement. The price of aviation turbine fuel needs to be lowered to make air transport competitive and affordable. Today, it is cheaper to travel by air to neighboring countries from India than to travel to certain parts of India itself. A more liberal aviation bilateral regime and a new aviation policy to benefit the econom y of the country as a whole rather than the national carriers alone would greatl y aid the development of tourism. Central and state governments need to evolve a taxation regime, which is revenue generating without being burdensome. Accommodation and transport taxes tend to be very heavy in certain states while the excise policy in others is extremel y harsh. The land policy in some states makes the setting up of a hotel a formidable exercise and as many as 48 clearances are required for the construction and running of a hotel. Such policies deter private sector investment. The imp ortance of protecting private investment in tourism must also be appreciated and activities such as mining, unauthorised construction, encroachments and haphazard development around tourist resorts must be prevented through appropriate legislation and public support. As tourism is a highly competitive industry; the traveller has a wide range of choices and looks for good value for money. The lack of qualit y infrastructure, uncompetitive rates, indifferent or poor product qualit y, difficult y in getting acce ss to information on travel and tourist
destinations, untrained service providers, and above all, the lack of hygiene, have an enormousl y negative effect on the competitiveness of the tourism product. A world class destination requires professional plannin g to prevent haphazard, uncontrolled growth, spatial and land use planning, strict architectural controls, sewerage infrastructure and water treatment plants. It requires improvement of entry points and appropriate facilitation
57
services. The lack of a visa -on- arrival regime on account of securit y considerations places India at a disadvantage vis --vis its competitors. It is necessary that India strikes a balance between securit y considerations and the need for tourism development and reviews its visa polic y to permit tourists from its major source markets to obtain visas on arrival. Equall y important is the behaviour of the host population. Training programmes are required not onl y for hotel managers but also for tourist guides, taxi drivers, staff at eatin g places, porters etc., as the manner in which they conduct themselves affects the tourists experience of the country. Important dos and donts in terms of a code of ethics need to be inculcated among the service providers. During the Tenth Plan, the Dep artment of Tourism will organise capacit y building programmes for service providers through mobile training units. 16.4 Factors Affecting the Long -Term Interest of Tourism A major impediment to the growth of tourism in India has been the lack of awareness about the benefits that it can bestow upon the host population. Unless the host population, both in the rural and urban areas, is supportive of tourism, it cannot become a vibrant economic force. The rural sector, in particular, has been largel y ignored in tourism development and has consequentl y been deprived of the benefits of employment and income generation accruing from tourism. The Tenth Plan will seek to rectify this, particularl y in view of the world -wide interest in rural tourism. While an awareness campaign that elicits local support for travel and tourism is essential for the long-term growth of the sector, it is also important to create awareness about the environmental impact of tourism by generating respect for the carrying capacities of tour ist destinations. This is
imperative as excessive exposure of ecologicall y fragile areas to human interference can lead to irreparable environmental degradation. As the demand for ecotourism is expected to grow enormousl y in the next decade, it is important to have regulations in place to prevent such damage. The
58
local population must be convinced of the need to support such regulations in the interest of long - term sustainabilit y. Indias hill resorts have already suffered seriousl y from a lack of concern f or their carrying capacities and the unchecked influx of tourists during the summer months. If Indias forest sanctuaries and pristine beaches are not to suffer the same fate, attention will have to be paid during the Tenth Plan to obtaining regulator y and public support for sustainabilit y concerns.
59
Chapter 17 Role of Department of Tourism
17. Role of Department of Tourism

Being the nodal agency for the development of tourism in the country, the department of tourism needs to make greater efforts to co -ordinate and integrate the policies of central ministries that have an impact on the
60
development of tourism and to mobilise state governments and the private sector to develop unique and competitive tourism products and
destinations. Crucial decisions affecting tourism are taken by other ministries viz. the Ministries of Finance, Home, Civil Aviation, Surface Transport, Environ ment and Forests, Urban Development, Rural
Development, Ocean Develop -ment etc. The Department of Tourism has tended to concentrate largel y on its role as the promoter of international tourism and generator of foreign exchange earnings while paying relativ el y less attention to inter -sectoral policy co-ordination and the all -important development of tourism infrastructure and product qualit y. In the Tenth Plan, the Department will redefine and expand its role and work towards intersectoral convergence and po licy integration to remove the barriers to the growth of tourism.
61
Chapter 18 Tenth Plan Strategy
18. Tenth Plan Strategy

The Tenth Plan strategy is to work towards a national consensus on the role of tourism in national development and to focus on the removal of barriers that hamper its growth. To make public sector investment more effective, it is necessary to work towards the inter-sectoral convergence of policies and
62
programmes that could benefit tourism. The New Tourism Policy envisages a framework, which is Government -led, private sector driven and oriented towards communit y welfare, with the Government creating the legi slative framework and basic infrastructure for tourism development, the private sector providing the qualit y product and the communit y providing active support. The overall vision of the development of tourism embodied in the new policy will be achieved th rough five key strategic objectives. These are: Positioning tourism as a national priority. Enhancing Indias competitiveness as a tourist destination. Improving and expanding product development . Creation of world class infrastructure. Effective marketing plans and programmes.
18.1 Positioning Tourism As A National Priority A concerted effort will be made, through the NDC, to arrive at a consensus on the role of tourism in the development agenda of the nation. Inclusion of tourism in the Concurrent List of the Constitution will provide constitutional recognition to the tourism sector and enable the central government to legislate for tourism development. A proposal to this effect has been circulated by the Department of Tourism to the state governments for comments and has also been discussed at a Chief Ministers conference and a majorit y of the states have agreed to the proposal. Other initiatives include the setting up of Tourism Advisory Council with key stakeholders functioning as a think tank and the constitution of a Group of Ministers on Tourism to improve policy integration and co -ordination. The adoption of a tourism satellite accounting system is underway to gauge more precisel y the contribution of tourism to the national econom y. A national aware ness campaign in order to create a popular movement in favour of tourism is being planned through a professionall y managed communication strategy.
63
Most importantl y, the efficiency of public investment in tourism supporting activities will be improved throu gh effective inter-sectoral coordination and prioritisation. 18.2 Enhancing Indias Competitiveness as a Tourist Destination As air capacit y available to India is woefull y short during the peak travel months, ranging from October to March, especiall y for t he main tourism originating regions such as North America, Western Europe and South Asia, it is necessary to open Indias skies to increase capacit y and help enhance tourism. Additional seat capacit y from the major tourism
generating destinations would sig nificantl y benefit the national econom y and provide a major impetus to tourism. Improvement in the standard of facilities and services at the international and national airports will need to be speeded up by employing professional manage -ment agencies and by privatising and leasing out airports. To enhance Indias competitiveness as a tourist destination, it is proposed to simplify the visa procedures and consider strategies for the speedy issue of visas including electronic visas and visas on arrival. An a ttempt will be made, through a consensus, to reduce the heavy and multiple taxes that reduce the competitiveness of the Indian tourism product. Special tourism police will be deployed at major tourist destinations during the Tenth Plan to provide securit y to travellers and promote India as a safe destination.
18.3 Improving And Expanding Product Development Product development strategy during the Tenth Plan will be related to the special interests oftourist target markets.
64
Cultural and heritage tourism will be expanded . India has a vast array of protected monuments with 22 world heritage sites, 16 of which are monuments. The integrated development of areas around these monuments provides an opportunit y for the development of cultural tourism in India. F or the development of beach and coastal tourism , a number of sites on the west coast of India will be identified for the development as beach resorts by the private sector. The sites will be offered on long term lease at preferential terms. These sites wil l primaril y be on the beaches of Goa, Kerala, and North Karnataka because of easier access by air. During the Tenth Plan Kochi in Kerala and the Andaman and Nicobar Islands will be developed as international cruise destinations because of their proximit y t o internationalcruise routes and their exotic appeal. Indias unmatched variety of cuisine is becoming increasingl y popular in the world and will be developed as a special attraction. It is proposed to create a highl y skilled workforce of culinary profes sionals through an innovative incentive scheme not onl y for India but also to promote Indian cuisine internationally. Village tourism will be promoted as the primary tourism product of India to spread tourism and its socio -economic benefits to rural areas. Indias great wildlife variet y has not been developed as a tourist attraction. Wildlife sanctuaries and national parks will become an integral part of the Indian tourism product. Priority will be given to the preparation of site and visitor management plans for key parks. The qualit y of tourist facilities available at the parks will be enhanced after a prioritisation of parks. Tentativel y these will be: Corbett National Park, Kanha National Park, Bandhav Garh National Park, Kaziranga, Madhumali, Bharatpur, Peri yar, Ranthambore, Little Rann of Kutch, Chilka, and the Sunderbans.
65
India has the greatest adventure tourism assets in the world in the Himalayas and its rivers. Mountain -based adventure activities will be developed and promoted. Regulations and certification for adventure
tourism operators will be introduced so that the minimum standards of safet y and conservation are met. India receives only a minuscule proportion of the global meetings, conventions and exhibition market. It is important that India develops a world class international convention cit y not just for the sake of tourism development but also for international an d domestic trade and commerce.. Indias most unique tourism product during the Tenth Plan will be holistic healing and rejuvenation packages. In focussing on this, it will capture the essence of Indian culture for international and Indian visitors alike. Indias fairs and festivals , some of which are already well established such as the Pushkar mela, the Desert Festival at Jaisalmer, the Kumbh Mela etc. will be promoted as unique products of India. The Festivals of India programme will be re-introduced in the top 12 future markets for India initiall y with an annual event in the United Kingdom and the United States, to be followed by triennial events in the other markets. Shopping will be recognised as an integral part of tourism. The development of dedicated shopping centres for traditional crafts designed along the lines of village haats such as Dilli Haat and Shilpgram will be encouraged and information on where to procure specific crafts made available through shopping guides. Delhi will be posit ioned as the cultural capital of India supported by an ongoing and vibrant calendar of cultural events. The development of such a niche-based special interest product mix will position India as a unique and competitive destination.
66
18.4 Creation of World C lass Infrastructure The need for physical infrastructure for tourism ranges from ports of entr y to modes of transport to destinations (airways, roadways, railways or waterways), to urban infrastructure such as access roads, power, water suppl y, sewerage an d telecommunication. This underscores the need for inter-sectoral convergence of infrastructural schemes and programmes that could support tourist destinations. The road network is vital for tourism as almost 70 per cent of passengers in India travel by ro ad. Many tourist circuits are entirel y dependent on roads. The current government plan for the road system in the country covering both inter-state highways and improvements to rural roads directl y supports tourism development. There is urgent need to cons truct and improve highways linking the 22 world heritage sites and places of tourist significance. The Ministry of Road Transport and National Highways will collaborate with the Ministry of Tourism in this effort. The Indian railway system can also become an enormous asset to the development of the tourism and hospitalit y industry in the country. The railways hold a special fascination for foreign tourists who wish to travel the country. For the vast majorit y of domestic tourists also, the railways is the most affordable means of travel linking the length and breadth of the country. Introduction of special tourist trains with pre -set itineraries and private sector participation will be encouraged. The Indian Railways plan to establish 100 hotels at railway s tations to serve specific tourist centres. The private sector will be given incentives to operate these hotels on long -term leases. These hotels will provide clean and inexpensive accommodation for budget tourists. The Indian Railways also owns a number of heritage structures, which, if effectively maintained and marketed, could serve, both as railway stations and places of tourist
67
interest. India has five hill railways, which compare with the best hill railway systems in the world. The enormous tourist pot ential of these products will be tapped during the Tenth Plan. As steam -hauled trains like the Royal Orient, Buddha Parikrama, Palace -On-Wheels and Fairy Queen are extremel y popular with tourists, steam traction for special tourist segments will be continu ed. Trains like the Shatabdi and the Rajdhani with a special tourism and hospitalit y focus will be planned both for foreign and domestic tourists. Indias 7,000 -km coastline and her might y rivers will be tapped for the promotion of cruises. Care will be t aken to develop world class tourism products. As the Ministry of Tourisms financial assistance to the states has not been able to have the desired impact in terms of creating of world class tourism infrastructure, the emphasis must shift to the developmen t of specific travel circuits as internationall y competitive destinations and the convergence of resources and expertise for these circuits. The availabilit y of trained manpower is essential to achieve excellence in the tourism sector. At present, there ar e 21 Institutes of Hotel Management and Catering Technology (IHM&TC) and 13 Food Craft Institutes in the country. In addition, a good number of accredited institutes also cater to the growing demand in the service sector. It is estimated that onl y 50 per cent of the requirement of the market is met by these institutes. Five new Institutes of hotel management would be set up in the Tenth Plan three in the newl y created states of Uttaranchal, Jharkhand and Chhattisgarh and two in the northeast. In addition, 15 more Food Craft Institutes will be set up in the Tenth Plan, and efforts will be made to take culinary crafts and training to the rural areas through mobile training units. A new scheme on capacit y building to train service providers in the unorganised sector such as small hotels, dhabas, restaurants and other eating joints is also proposed.
68
18.5 Strategy For Effective Marketing As there is fierce competition for tourists from Indias source markets, India needs to change its traditional marketing appro ach to one that is more competitive and modern. It needs to develop a unique market position, image and brand, which cannot be held by any other competitor. Indias positioning statement will capture the essence of its tourism product to convey an image of the product to a potential customer. This image will be related not onl y to its ancient Vedic civilisation with a cultural heritage that continues to thrive especiall y in its rural areas but also to its essentiall y secular nature. In the Tenth Plan, an extensive market research programme will be launched in the target source markets and tourism products developed to cater to the interests of each source market. An effective and ongoing market representation presence will be established with the travel tr ade in each source market and an Internet portal set up in various languages to provide information, a description of the product and the product
requirements of the target market segments. The Internet has a great impact on the marketing of travel and tou rism. It has already established itself as a channel through which tourism organizations can promote their
destinations and products. Indian tourism will utilise both the Internet and other emerging interactive technologies to avail of the benefits to be gained.
69
Chapter 19 The Path Ahead
19. The Path Ahead

The tourism sector needs a national consensus on the role and place of tourism in national development and the earl y removal of impediments that
70
have hitherto handicapped its growth. The Tenth Plan target of the creation of 18 million jobs through tourism requires a substantial investment of Rs. 38,800 crore at the rate of 47 jobs per one million rupees of investment, both from the public and the private sector. The central sector outlay for tourism during the 10th Five Year Plan is Rs. 2,900 crores, the scheme wise break-up of which is given in the Appendix. Public sector investment, though limited, can be made more efficient through the intersectoral convergence of policies and programme s
supportive of tourism. An integrated inter -sectoral investment plan that provides effective infrastructural support to tourism through the Ministries of Railways, Surface Transport, Shipping, Civil Aviation, Urban
Development, Rural Development and Envir onment and Forests etc. can be achieved through the preparation of a tourism component plan. Private sector investment can be enhanced by removing the barriers to growth and expediting critical policies that are being evolved. Public and legislative support will be essential for the sustainable development of the sector. The success of the New Tourism Policy 2002 will be largel y determined by the success achieved on all these fronts.
71
Chapter 20 The Incredible India Campaign

Marketing India to the World
19. The Incredible India Campaign

Marketing India to the World
72
Before the Incredible India campaign, India was being promoted differently in
different countries, if at all. There werent two or three distinct images. This campaign chan ged that. Lavanya Anirudh, Account director, Ogilvy & Mather (India), in 2004. Before 2002, the Government of India (GoI) regularl y formulated policies and prepared pamphlets and brochures for the promotion of tourism; however it did not support tourism i n a concerted fashion. As a result, the country attracted very few tourists, a country like France, six times smaller than India, attracted around 20 times the number of tourists. India perhaps was an indication of the extent to which previous governmental efforts to promote tourism had been unsuccessful. However, in 2002, the tourism ministry made a conscious effort to bring in more professionalism in its attempts to promote tourism. It formulated an integrated communication strategy with the aim of promot ing India as a destination of choice for the discerning traveler. The tourism ministry engaged the services of Ogilvy & Mather (India) (O&M) to create a new campaign to increase the tourist inflows into the country. The Incredible India campaign was laun ched in 2002 with a series of television advertisement. The campaign was based on the striking pictures and themes related to Indias cultural legacy (yoga, ayurveda), scenic locales, etc. The aim of the campaign was to project India as a unique opportunit y for physical invigoration, mental rejuvenation, cultural enrichment and spiritual elevation. The campaign was rolled out on some of the major television channels between January and March 2002.
The Incredible India Campaign on TV
73
Channels Discovery Channel Discovery Channel Travel Channel BBC World CNN
Period January 15-March 15,2002 (8 weeks) January 15-March 15,2002 (8 weeks) January 2002(2-3 weeks)
Region Europe, Asia, Middle East & Africa South-East Asia, Australia and New Zealand All Channels
January2002Europe, Asia-pacific, Australia March2002 (10 weeks) January 2002-March Europe, Asia, Middle East, 2002 (10 weeks) Africa
The campaign also made exclusive use of the internet. In March 2002, the official website of the tourism ministry ( www.tourismofindia.com ) was redesigned to make it both more attractive and functional. Prospective tourist could use the website to plan their trip to India. The print ad campaign was complemented by a similar ad campaign on the internet, which focused on specific destinations and themes. The online ad were placed in country-specific travel websites, portals, and search engines. Electronic newsletters and mailers were sent to people who subscribed to the service.
Region-wise Websites Visits 74
Region Asia North America Oceania Europe South America Africa
Total visits 188,116 125,573 37,760 22.853 1,192 1,055 375,549
Percentage 49.96 33.34 10..3 6.07 0.32 0.28 100.00
In March 2005, a TV campaign Let us go to India was launched in Japan and a campaign Walk with Buddha, in Thailand and China. Several roadshows were also organized as part of the Incredible India campaign in Milan, Paris, and cities in Serbia and other East European countries. A tram i n Berlin, Germany, was painted with the Incredible India colours and, it reportedl y became the talk of the town. In 2005, the tourism ministry launched several innovative schemes such as Athithi devo Bhava, rural tourism, and Pri yadarshini under the Incredible India umbrella. The Athithi devo Bhava program was a social
awareness initiative of the ministry to sensitize the general Indian public to; the importance of treating foreign tourists with respect and courtesy. As a part of the program, taxi d rivers, guides, immigration officers, tourist police, and other people in select cities like Delhi, Mumbai, Jaipur, Agra, and Aurangabad, who interacted directly with tourists, were trained on personal hygiene, etiquette, English language skills, etc. The rural tourism scheme had the twin objective of showcasing the
uniqueness of the arts, crafts, and heritage of rural India and helping the rural folk benefit from tourism. In the first phase, 63 rural areas were identified and Rs. 5 mn was allotted to e ach area for upgrading approach
75
roads, landscaping, cleaning water bodies, maintaining monuments, etc. the ministry joined hands with Non -government Organisation (NGOs) to provide a unique experience of rural India to discerning tourists. An exclusive website-www.exploreruralindia.org, was also launched. Similarl y under the Pri yadarshini scheme, the ministry made efforts to bring more women into tourism -related areas. The ministry reportedl y spend Rs.1. bn on the Incredible India campaign in 2005. More importantl y, the campaign was successful in boosting international tourist travels. In 2004 Incredible India campaign led to a 36% growth in the US dollar terms and 255 in number of tourists (both domestic and foreign), said Amitabh Kant, Joint Secretary, Ministry of Tourism. The upward surge in tourist numbers continued in 2005 as well and it resulted in brisk business for hotelier and other tourism -related enterprises. Domestic tourism too received healthy growth levels. The high standards of the campaign were acknowledged when the Indian tourism ministry won the 2004 PATA Gold award for the Incredible Taj campaign. Media report suggested that the ministry of tourism was planning to; spend Rs.1.5 bn on the Incredible India campaign in 2006. while around Rs.1 bn was to be spent on overseas promotion and marketing, the remaining was to be allocated for advertising in the print and electronic media. According to projections made by the World Travel and Tourism Council (WTTC), India could expect to earn US$90 .4 bn in revenues and crate 28 million jobs from tourism sector by 2014. There was also a general agreement that India could capitalize on its distinct strengths and effectivel y market itself. However, irrespective of whether or not the Incredible India campaign had proved successful in bringing in more tourist and revenues.
76
Taglines of Tourism Departments of Some States

No 1 2 3 4 5 6 7 8 State Orissa Kerala Maharashtra Uttar Pradesh Madhya Pradesh Andhra Pradesh Goa Gujarat Tagline Senic.Serene.Subline Gods Own Country Unlimited Amazing Heritage.Grand Experieces The very heart Of India The Kohinoor Of India Go Goa.The Perfect Holiday Destination Vibrant Gujarat.Where Life is a Celebration 9 Andaman Emerald.Blue.And You
77
Fig 20.1 :- Print Ads Of Incredible Taj
Print Ads in Incredible Taj Campaign that Won the PATA Awards-2005
78
Chapter 21 Conclusion
21. Conclusion 79
Indian Tourism Industry has a strong relationship with the economic growth of the country. As GDP continues to increase, it enhances investment in basic infrastructure like transport system, which is a vital support to tourism in India.
Closel y associated is the hotel industry in India, which has added to the growth in Indian tourism since 2004. India has become one of the popular tourist destinations in the world. Of course there has been the governments support through its Incredible India campaign, which showed new light to foreign tourists. In 2005 the arrival of international tourists grew by 16% giving boost to Indian tourism.
The Union Financial Budget 2006 -07 has allocated Rs.8.5 Bn for Indian tourism sector in the tenth Five Year Pl an. Having increased the service tax to 12% there is more expected revenue for the government.
With lot of imagination and ideas the Indian tourism sector is gathering momentum and is set to have not onl y large numbers of foreign tourists but also make a big share in the countrys Gross Domestic Product ( GDP ). Recent statistics have revealed that during the first quarter of 2006, the performance of the tourism industry has been very encouraging which has registered an 11% increase in foreign tourist arri vals.
With the given allocation to the Indian tourism industry in the budget, the Government appears to have realized the significance of this sector in earning valuable foreign exchange as also enabling greater employment. As new destinations develop the tourist inflow is anticipated to increase.
80

Tourism Project

Transféré par

Informations du document

Description originale:

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

Tourism Project

Transféré par

Droits d'auteur :

Formats disponibles

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

1.1What is foreign exchange?

Role of Tourism Industry in Generating Foreign Exchange

1.3 On Tourism Industry

Role of Tourism Industry in Generating Foreign Exchange

Chapter 2 World Tourism

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Fig 2.1: International Tourists Arrival In Millions

Role of Tourism Industry in Generating Foreign Exchange

Fig 2.2:- Graph On International Tourists Arrivals

Fig 2.3 :- Graph On International Tourism Receipts

Fig 2.4 :- International Tourism Receipts In Billions US $

Role of Tourism Industry in Generating Foreign Exchange

2.1 World Tourism Organisations Vision 2020:

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Chapter 3 Tourism Industry in India

3. Tourism Industry in India

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Fig.3.3 :-Foreign Exchange From Tourism (in Cr.)

Role of Tourism Industry in Generating Foreign Exchange

Fig 3.4 :- Foreign Exchange Earnings Through Tourism

Role of Tourism Industry in Generating Foreign Exchange

Fig 3.5 :- Graphical Representation of Foreign Exchange Earnings

Role of Tourism Industry in Generating Foreign Exchange

Chapter 4 Global Status & Trends

4. Global Status & Trends

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Chapter 5 Global Market Trends

5. Global Market Trends

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Chapter 6 Indias Place in World Tourism.

6. Indias Place in World Tourism.

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Fig 6.1 :- Share Of Top Ten Countrie s In International Tourists Arrival

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Chapter 7 Indias Tourist Profile

7. Indias Tourist Profile

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Chapter 8 Domestic Tourism

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Fig 8.1 :- Domestic Tourist Visits

Role of Tourism Industry in Generating Foreign Exchange

Fig 8.2 :- Graphical Representation of Domestic Tourist Visits

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange

Chapter 9 Tourism In India (2004-2005)

Tourism In India (2004-2005)

Role of Tourism Industry in Generating Foreign Exchange

Role of Tourism Industry in Generating Foreign Exchange