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Pestle Analysis Of Indian Tourism Industry


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Pestle analysis of indian tourism


industry
PESTLE Analysis of Indian tourism industry
Introduction about the topic :
It is time for India's Tourism sector. Driven by a surge in business traveller arrivals and a soaring
interest in India as a tourist destination, the year 2006 has been the best year till date.
Incredible India !!
India is probably the only country that offers various categories of tourism. These include history
tourism, adventure tourism, medical tourism (ayurveda and other forms of Indian medications),
spiritual tourism, beach tourism (India has the longest coastline in the East) etc.
Explore India - choose the locales of your choice, and see what each state has to offer. Lose
yourself in the wonder that is India. Meander through lands steeped in chivalry and pageantry
that begin before recorded history. Explore modern cities that have grown organically from the
roots of a multi-hued past. Make a pilgrimage to holy shrines that echo with tales of antiquity.
Frolic on a vast array of golden beaches that dot an enviable coastline, washed by two seas and
an ocean. Sport with adventure in style. Let the jungle lure you to a fascinating world at a diverse
array of wildlife sanctuaries and national parks....... this is the wonder that is India.

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Indian Tourism industry is one of the most important export industries of the country. Although
the international tourist inflow is relatively low, India has found tourism emerging as an
important sector of its economy.
Tourism yields substantial foreign exchange for India. It is turning into a volume game where a
large number of participants are contributing to the revenue of the industry. Segments such as
hotels, tour operators, airlines, shipping etc.

Growth period of Indian tourism industry


The tourism industry in India is substantial and vibrant, and the country is fast becoming a major
global destination. India's travel and tourism industry is one of them most profitable industries in
the country, and also credited with contributing a substantial amount of foreign exchange. This is
illustrated by the fact that during 2006, four million tourists visited India and spent US $8.9
billion.
Several reasons are cited for the growth and prosperity of India's travel and tourism industry.
Economic growth has added millions annually to the ranks of India's middle class, a group that is
driving domestic tourism growth. Disposable income in India has grown by 10.11% annually
from 2001-2006.
Thanks in part to its booming IT and outsourcing industry a growing number of business trips are
made by foreigners to India, who will often add a weekend break or longer holiday to their trip.
Foreign tourists spend more in India than almost any other country worldwide. Tourist arrivals
are projected to increase by over 22% per year through till 2010, with a 33% increase in foreign
exchange.
The Tourism Ministry has also played an important role in the development of the industry,
initiating advertising campaigns such as the 'Incredible India' campaign, which promoted India's
culture and tourist attractions in a fresh and memorable way. The campaign helped create a
colorful image of India in the minds of consumers all over the world, and has directly led to an
increase in the interest in tourism industry has helped growth in other sectors as diverse as
horticulture, handicrafts, agriculture, construction and even poultry.
Welcome to Incredible India

Namaskar,
Welcome to Incredible India! A journey into mysticism through the land of the unexpected.
Bounded by the majestic Himalayan ranges in the north and edged by an endless stretch of
golden beaches, India is a vivid kaleidoscope of landscapes, magnificent historical sites and
royal cities, misty mountain retreats, colorful people, rich cultures and festivities. Modern India
is home alike to the tribal with his anachronistic lifestyle and to the sophisticated urban jet-setter.
It is a land where temple elephants exist amicably with the microchip. Its ancient monuments are
the backdrop for the world's largest democracy.
If you're planning a holiday to India, looking for hotels and accommodation and events
information or simply interested in India as a country you are sure to find many insights on the
multifaceted travel options to India here.The timeless mystery and beauty of India can be

experienced only by visiting this ancient Land. There's just one thing you'll need to travel
through 5000 years of culture and tradition- A comfortable pair of shoes.
The following table provides the major tourist attractions in India by state:
<
Tourist Attraction
Charminar

State

Kaziranga National Park

Assam

Qutub Minar

Delhi

Mangueshi Temple

Goa

Shimla

Himachal Pradesh

Dal Lake

Jammu and Kashmir

Jog Falls

Shimoga District, Karnataka

Kovalam Beach

Kerala

Amarkantak

Madhya Pradesh

Ajanta

Maharashtra

Puri

Orissa

Golden Temple

Amritsar, Punjab

Jaipur

Rajasthan

Chennai

Tamil Nadu

Badrinath Temple

Uttarakhand

Varanasi

Uttar Pradesh

Hyderabad, Andhra Pradesh

The various segments within tourism are:


Medical Tourism
It is one of the fastest growing segments in India. India has been able to leverage on certain
advantages it has over other countries like highly skilled doctors, cost effective treatment,
improved quality of private healthcare etc. Some of the common treatments for which overseas
patients to come to India are heart surgery, knee transplant, cosmetic surgery and dental care.
India's traditional rejuvenation therapy like yoga and ayurvedic therapy are also becoming
popular.

Eco Tourism

It is relatively new segment in India. It involves visiting natural areas without disturbing the
fragile ecosystem. Eco tourism generates wealth for the local people, who in turn take measures
to conserve and protect the environment and natural resources. India with its natural diversity is
one of the pristine places in the world for eco tourism. The Himalayan region, Kerala, Northeast,
Andaman and Nicobar Islands and Lakshadweep islands the Western and Eastern Ghats are some
of the hot spots for eco tourism in India. India has some of the best wildlife reserves in the world,
rich in flora and fauna.

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Heritage Tourism
Heritage tourism is a very lucrative segment in India. It is widely believed it would emerge as the
most important segment within tourism in terms of revenue generation by 2010.India has a rich
cultural history and reflection of its glorious past is still visible in its numerous forts,
monuments, palaces, places of worship etc. Heritage tourism itself can be further classified as
colonial heritage, urban renewal, religious tourism, industrial heritage and ethnicity. The Indian
government must show keen interest in preserving the heritage sites from a tourism perspective.

Adventure Tourism
India's varied geographical and climatic conditions offer excellent opportunity for adventure
sports. In recent times the popularity of adventure tourism has increased. Adventure sports like
river rafting, rock climbing, mountaineering, trekking, skiing, snow climbing, scuba diving and
angling can be undertaken in the country and the country offers multiple locations to choose
from. The trans Himalayan region, the Garhwal and Kumaon mountains, the Western Ghats,
deserts of Rajasthan, Andaman and Lakshadweep islands are some of the most popular
destination for adventure tourism.

Future trends

The real GDP growth for travel and tourism economy is expected to be 0.2 per cent in
2009 and is expected to grow at an average of 7.7 per cent per annum in the coming decade.

Earning through exports from international visitors and tourism goods are expected to
generate 6.0 per cent of total exports (nearly $16.9 billion) in 2009 and expected to increase
to US$ 51.4 billion in 2019.

According to the Ministry of Tourism, Foreign Tourist Arrivals (FTAs) for the period
from January to March in 2009 was 1.461 million. For the month of March 2009 the FTAs
was 472000.The reason for the decline is attributed to the ongoing economic crisis.

In spite of the short term and medium term impediment due to the global meltdown the
revenues from tourism is expected to increase by 42 per cent from 2007 to 2017.

PESTLE Analysis of tourism industry


Definition
The PESTLE framework is an analysis tool that is used to identify the key drivers of change in
the strategic environment (Johnson et al., 2008). PESTLE analysis includes Political, Economic,
Social, Technological, Legal, and Environmental factors.

Political effect on tourism industryPolitical violence has done considerable damage to tourism in Asia and the Pacific over the past
few years. But industry experts say the damage is not necessarily permanent. Governments and
industry leaders say much can be done to rebuild tattered tourism reputations.
As the world watched, a small band of terrorists killed scores in Mumbai last November.
Although India has often suffered from political violence, this attack - aimed largely at travelers
and foreigners - was a new horror.
The globally televised attack, coming during an international economic slump, contributed to an
eight percent fall in tourist arrivals this year.
In Thailand, tens of thousands of anti-government protesters laid siege to Bangkok's airports late
last year, essentially trapping more than 350,000 travelers in the country for a week. Before that
shock had worn off, a few months later, another group of protesters led violent riots in Bangkok.
The two incidents added to the damage from the world economy cut tourist arrivals to Thailand
by 20 percent in the first six months of 2009.
Phornsiri Manoharn, the chairwoman of the Pacific Asia Travel Association, says many tourists
still worry that Thailand's political tensions could spoil their visits.
"When people saw any demonstration like that they associate with the closing of the airport,"
said Manoharn. "Even [though] we don't close [the airport] but they look like the demonstration,
that they might and that's why they're afraid."
Tourism is important to the Asia-Pacific region. In Southeast Asia, it contributes over three
percent to economic output. In some parts of the region, tourism accounts for 10 percent of
employment; in the Pacific island nations of Fiji and Vanuatu, the figure is over 30 percent.
But as India and Thailand have seen, violence and instability quickly scare away visitors.
Recovery comes, but usually more slowly than after natural disasters.

John Koldowski is PATA's communications director.


"What we have seen in many cases is where there is some sort of intervention effect - it's been
natural or no fault of anybody - the rebound has been very quick," he said. "Where there has
been intent to cause harm as in the case of a say terrorist attack - and where there has been a long
history of such attacks occurring in that destination or nearby destination, it takes a little longer
to come back."
But with the right government and industry responses, visitors will return. For instance, in
October 2002, bombs set off by Islamic militants on the island of Bali killed more than 200
people, most of them foreigners. The island, one of the world's most famous tourist destinations,
saw arrivals fall by 36 percent in 2003.
Koldowski said the first bombings shocked the tourism industry.
"Bali is a classic case there - it took some time [to recover] because it had never occurred there
before - it was so dramatic and affected specific western tourists," he said.

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But the Indonesian government cracked down on terrorists and boosted security. And tourism
industry professionals worked hard to woo back visitors. When another attack three years later
left 20 people dead, PATA reported that tourist arrivals were little affected.
And twin bombings at international hotels in Jakarta last July are expected to do little damage to
tourism.
In South Asia, Sri Lanka and Nepal hope the end of long-running conflicts will entice more
visitors.
Sri Lankan officials say the end of a civil war earlier this year brought a surge of interest from
foreign investors and hotel operators.
Dileep Mudadeniya, Sri Lankan Tourism Promotion Bureau managing director, says there are
opportunities for tourism, particularly in areas long closed off by the war.
"North and east, which have not actually taken any kind of development for the last 20 years,
virgin beaches, land, monuments is available and the people also come and exploit something or
look at something totally undiscovered," said Mudadeniya. "We are going on the line which is
'undiscovered, unspoiled, an island of authenticity', which we can offer."
In Nepal, political agreements have ended a Maoist insurgency that lasted more than a decade.

The minister for Tourism and Civil Aviation, Sharatsingh Bhandari, says Nepal's transition from
conflict to peace is in itself a tourism draw.
"Now we are going to form a new Nepal. So giving the message for the New Nepal and inviting
the people to see, not only the prospect of tourism itself but even the process of transition of the
political system from 'bullet to ballot.' That was done successfully by the Nepalese themselves,"
he said.
Industry analysts say tourism in Asia is likely to expand rapidly over the next few years. But, the
key, they say, is that governments find ways to prevent political violence, and act quickly to calm
fears when it does happen.

Economic effect on tourism industryThe service economy is driving growth in most OECD countries. It represents a large part of
economic activity and its importance continues to grow. Tourism, a large, complex and
fragmented industry which is still very difficult to define and measure, is a key component of the
service economy (30% of international trade in services in the OECD area). In terms of revenue,
OECD countries generate about 70% of world tourism activity. Tourism, which has expanded
dramatically over the past 30 years, looks set to continue growing as societies become more
mobile and prosperous.
Obtaining better information on services, the least developed side of statistics, is an important
challenge for statistical agencies and a necessity for political analysis. Measuring tourism is part
of a wider move to improve our knowledge of how economies work, what they produce and
what changes occur over time. It is no longer enough to measure physical flows (arrivals and
overnight stays) and monetary data (revenue and expenditure relating to international tourism).
In the early 1980s, the OECD began work to set up a model acceptable at international level
which gave rise to the OECD Tourism Economic Accounts, which measure certain socioeconomic aspects of tourism. While developing this tool, the OECD produced a more precise
definition of tourism, visitors and tourist expenditure [Note: OECD (1996), OECD Tourism
Statistics - Design and Application for Policy].
Despite its economic importance, governments, especially in developed economies, still do not
adequately recognise tourism. For this reason, the OECD has developed and recently approved
the OECD Guidelines for a Tourism Satellite Account and an Employment Module. These
integrated statistical tools aim to measure the economic aspects of tourism (value added, jobs,
revenue, investment, profits) in order to provide a more convincing demonstration of this
activity's economic significance.
Furthermore, together with the United Nations, the World Tourism Organization and the
European Commission (Eurostat), the OECD has developed a " UN-WTO-OECD-EUROSTAT
Tourism Satellite Account: Recommended Methodological Framework", approved by the 25member United Nations Statistical Commission on 1 March 2000. A publication is available.
Other work undertaken in this area includes statistical research. OECD and Eurostat regularly
organise international forums on tourism statistics to share ideas, experiences and concepts with
Member and non-members countries, the scientific community and the tourism industry. The
United Kingdom, with the support of Eurostat and the OECD, organised the Fifth International

Forum on Tourism Statistics (Glasgow, 20-23 June 2000). Similar forums have been organised in
Vienna (1994), in Venice (1995), in Sintra (1996) and in Copenhagen (1998).

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Technological effect on tourism industryDefinition of Tourism Technology


The convergence of industries has forced people to create terminology such as information
technology, biotechnology, ubiquitous technology and even cultural technology to explain
frequently talked about topics. Tourism Technology is a term that encompasses all social,
cultural, managerial, and value-adding activities of the tourism industry. Tourism Technology
also incorporates and encourages technological advancements and economic development in the
tourism industry.

The Origin of Tourism Technology


"Tourism Technology", initially based on the concept of cultural technology, is a more
comprehensive term covering knowledge used to add to the value of tourism products on a micro
level and the management of the travel and tourism industry on a macro level. New tourism
products are also the end result of tourism technology combining with other industries. These
include medical tourism, educational tourism, agricultural tourism, marine tourism and the
application of information technology to the travel and tourism industry.

Application of Tourism Technology


The term "technology" can easily call to mind scientific achievements, computer graphic skills,
special effects and other engineering-related images. However, "Tourism Technology"
encompasses the integrated fields mentioned in the previous paragraph, statistics, managerial and
socio-cultural know-how, and skills that the tourism industry can adopt to design, produce, and
market various tourism products. In addition to coordinating various aspects of human resources
in the travel and tourism industry, Tourism Technology describes a comprehensive field
containing but not limited to such widely referred to subjects as entertainment technology,
contents technology and creative technology.

Software for Tourists

One of the latest applications is software that permits tourists to customize their visits according
to their preferences. Luis Castillo Vidal, computer engineer of the University of Granada and one
of the authors of the study, points out that, in order to design the customized visit plans, they
have used Artificial Intelligence techniques, a science that provides computers with abilities to
solve problems which, in principle, can only be solved by humans.
Users must have access to the internet, either through a computer, a mobile phone or a PDA, in
order to be able to access a web where they can define their preferences and needs, such as their
artistic, cultural and gastronomic preferences, their lifestyle and favourite hours, whether they
are disabled or not and the spending capacity.

Environmental effect on tourism industryThe quality of the environment, both natural and man-made, is essential to tourism. However,
tourism's relationship with the environment is complex. It involves many activities that can have
adverse environmental effects. Many of these impacts are linked with the construction of general
infrastructure such as roads and airports, and of tourism facilities, including resorts, hotels,
restaurants, shops, golf courses and marinas. The negative impacts of tourism development can
gradually destroy the environmental resources on which it depends.
On the other hand, tourism has the potential to create beneficial effects on the environment by
contributing to environmental protection and conservation. It is a way to raise awareness of
environmental values and it can serve as a tool to finance protection of natural areas and increase
their economic importance.

Three main impact areas: natural resources, pollution, and physical impacts

Environmental impacts at the global level

Other industry impacts on tourism

How tourism can contribute to environmental conservation

Social effect on tourism industryJamaica is primarily a 'sun, sea and sand' destination and, therefore, the primary recreational
activities of visitors include sun and sea bathing on the beaches. Tourists who visit Jamaica are,
therefore, primarily involved in activities such as going to the beach, snorkelling, scuba diving
and glass-bottom boating.
Jamaica's tourism product is dependent on the coral reefs and their associated ecosystems such as
seagrass beds and mangroves. These ecosystems are, however, threatened by natural causes and
human behaviour such as coastal pollution, rapid coastal development, over-fishing and global
warming.
All parties involved (the citizens, the tourism industry and the visitors) have a vested interest in
the management of the environmental resource base and an obligation to do their part to support

this management. If the environment is degraded all parties stand to lose - visitors will fail to
come (or will be willing to pay less) and the countries will lose an important source of economic
benefit. In other words the environment will produce reduced economic, ecological, and amenity
benefits.
Microeconomic theory is essentially the study of the equitable distribution of scarce goods or
benefits. In this example the scarce benefit is the Jamaican beach tourism product. The economic
theory provides approaches to making the demand and supply of these scarce benefits more
efficient. Demand of the 'good' in this case is the 'beach-lust' (sun, sand, sea) tourism of Jamaica.
This is in contrast to the 'wonder-lust tourism' such as safaris, mountain climbing, cultural and
heritage tourism that is observed in other parts of the world. The 'good' is supplied at a cost
which would include the traditional costs of, labour and capital etc. However when the cost of
the provision of the good does not take into account negative externalities such as environmental
damage, this results in market failure. If this market failure is not corrected it will result in a loss
in social welfare (dead-weight loss).

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Jamaica's current tourism model is based on the construction of mega super inclusive resorts,
which often require engineering solutions such as dredging, groyne construction and limestone
blasting in order to create swimming beaches, and construct buildings a few meters away from
the high water mark. Construction and operation of tourist facilities such as hotels and other
attractions also result in significant alterations to the terrestrial environment, trees, insects, birds
etc. Operation of these entities also results in the diversion of resources such as water and
electricity which could have been used elsewhere in the society.

MARKET FAILURE
Increased construction activity in the coast provides relatively short term and low-skilled
employment. The intermittent demand for this pool of labour often results in the proliferation of
unplanned settlements and squatter communities that are established close to the resort areas.
These settlements are typically located in the hills and mountains above the coast. The creation
of these communities results in the destruction of the watershed in these areas as well as
inadequate sewage treatment and solid waste management. All of which contribute to reduced
environmental quality; for example, reduced water quality as a result of increased nutrients and
turbidity in the coastal waters.
The simple economic analysis of Jamaica's tourism model outlined above suggests that market
failure exists. The fundamental reason for the market failure associated with Jamaica's tourism

model is the fact that the economic 'rent' associated with the natural environment is not captured
by the people of Jamaica.
'Economic rent' is an excess return on an asset, a profit above normal market rates of return.
Rents usually arise from assets that are scarce and fixed in supply. Beachfront property is a very
good example of the type of assets that will yield economic rent. Or another example is the
higher property costs in Coopers Hill or Beverly Hills when compared to Havendale or Mona,
the economic rent (or value added) in this case being a view of the city. It can be argued that
economic rents such as the beauty and natural environment should accrue to the people of
Jamaica and not to foreign tourists or tourism operators. Rents are essentially a type of payment
for the use of the resource. So the first reason for market failure is that there is no real capture of
economic rents.
A second example of market failure is that these tourism entities that are currently gaining all of
the rents are also not accounting for the negative externalities of their activities. For example,
hotels do not pay for the true costs of pollution and negative impacts associated with the use and
operation of their facilities. However the problem of market failure does not stop here. As with
several other Caribbean nations, the development of the tourism industry is heavily subsidised by
the Jamaican government. Hotels and attractions are given tax holidays (e.g. no taxes for 10, 15,
20 years), duty is waived on imports of construction materials among other things.
Additionally, the Government's facilitation such as fast-tracking permit requirements and their
suspected role in circumventing environmental and planning regulations can reduce costs to
investors and also be viewed as a subsidy. So in addition to the non-capture of rent and ignoring
negative externalities, government subsidies to the tourism industry through tax holidays and
other waivers also exacerbate the problem of market failure. This in turn means that the welfare
of the society i.e. the Jamaican people is even more reduced.

POSSIBLE REMEDIES
As was highlighted above correcting market failures can be achieved through the implementation
of taxes. In the case of Jamaica's coastal tourism this would mean that investors are forced to
internalise environmental costs. This would theoretically lead to better environmental
management and sustainable development of the tourism industry. However, given the current
political climate in Jamaica and the influence of the tourism industry players this suggestion is
likely to be received with hostility.
Given this fact a more feasible way of capturing some of the economic rent is to capture a small
portion of the benefits that accrue to the visitors to the island. This would be through the use of
the existing system of arrivals taxes from cruise and stopover visitors to the island. However,
unlike the current system where the charges are often hidden in room surcharges or airline tickets
the additional environmental tax should be explicitly identified.

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HIDDEN COSTS
There are, of course, wider questions of the true economic contribution of tourism. Clearly
tourism is very important to Jamaica's economic sustainability. The Jamaican tourism industry
accounts for 32 per cent of total employment and 36 per cent of the country's GDP according to
many studies. However, based on some of the market failures described above, are there more
costs that are not being considered? Tourism has many hidden costs, which can have
unfavourable economic effects on host countries such as Jamaica.
The direct income for a country is the amount of tourist expenditure that remains after taxes,
profits, and wages are paid and after imports are purchased; these subtracted amounts are called
leakage.
For the all-inclusive tourism model, studies show that about 80 per cent of travellers'
expenditures go to the airlines, hotels and other international companies, and not to local
businesses or workers. In addition, significant amounts of income actually retained at the
destination level can leave again through leakage. For example, the profits gained by foreignowned tour operators, airlines, hotels, are repatriated to their home countries. Estimates made for
Third World countries range from 80 per cent in the Caribbean to 40 per cent in India. In
layman's term, on average, of each US$100 spent on a vacation tour by a tourist from a
developed country, only about US$5 actually stays in the developing-country destination's
economy.
The current tensions between local craft vendors, restaurants and other service industries and
large resort chains are all too common and point to the problem of leakage. Super inclusive
hotels do not encourage guests to venture outside the walls of the hotel and so most of the
tourist's experience is limited to the entertainment as well as the sun, sea and sand activities
available at that location. One could say that Jamaica the country is not the destination, it is
actually the 'resort' that is the destination. More comprehensive studies on this issue are urgently
required by our academic institutions in the region. Caribbean researchers have a responsibility
to provide balanced information that can enrich the discourse between all the relevant
stakeholders. Much of the discourse is driven by short sightedness and politics on one side and
passionate advocacy on the other. Too often the arguments of the contending parties (developers
versus environmental advocates) are not supported by balanced information.

Legal effect on tourism industryMUSCAT -- Tourist traffic into the Sultanate is projected to scale new highs next year on the
back of a raft of major initiatives, most notably an aggressive campaign targeting new markets,
according to the Under-Secretary of the Ministry of Tourism Ministry of Tourism

, Mohammed bin Hamoud al Toobi. Al Toobi predicted a record year for Oman's tourism
industry during 2010 as marketing strategies implemented by the ministry, coupled with national
carrier Oman AirOman AirLoading...'s ambitious route expansion plans, continue to pay
dividends.
"2010 will be a record year for our tourism industry," said Al Toobi. "First, we will be taking a
more aggressive approach in our marketing work assisted by the appointment of a creative
agency. This will allow us to run targeted campaigns across the GCC, UK, Europe and Australian
markets using a consistent 'look and feel'. We will work with trade and airline partners so that we
invest more in consumer direct marketing," he added in comments to the Observer.
Importantly, the Tourism MinistryTourism Ministry Loading... has also set its sights on the
potentially vast markets of Russia, China and India, the under-secretary said. "2010 sees the
ministry enter new markets. We are investigating representation in the Russian Federation and
India, and looking to appoint a PR/Communications agency to boost awareness of Oman at the
World Expo in Shanghai. Year's end will see Muscat host the 2nd Asian Beach Games. "With the
organising committee we are keen to look at how marketing can be leveraged, so that awareness
of Oman in China and Asia is increased. This is an important legacy outcome for all economic
sectors. Entry into India, China and Asia is timely.
These economies are growing strongly, so we must adapt our strategies accordingly," he said. In
association with Oman AirOman AirLoading..., the Tourism MinistryTourism MinistryLoading...
aims to continue joint marketing initiatives targeting the key European market, Al Toobi said.
Furthermore, the airline's expansion to Kuala Lumpur in early 2010 also opens up opportunities
to tap Malaysia's capital market, as well as markets served through Kuala Lumpur airport, he
said. Significantly, the ministry will continue to promote the Sultanate as a high quality
destination aimed primarily at responsible tourists, the official stressed.

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"Concerning our market positioning, we will continue to focus on Oman as a destination for
authentic, high quality Arabian experiences across our pitch to high yielding segments and
responsible tourists. In doing this work, we see the need to work across all media platforms
(print, digital, TV) more effectively. Again, our focus will be on high-yield segments and
responsible tourism," he noted.
Commenting on the impact of the global economic downturn on Oman's tourism sector, he said
the ministry had responded prudently to the crisis at the very outset. "I believe the ministry made
the right decisions at the time. When the banking system collapsed in the last quarter of 2007, the
ministry and Oman AirOman AirLoading... still went ahead with the launch of Oman's largest-

ever consumer direct marketing campaign in the United Kingdom. This surprised many industry
commentators, but it presented some welcome opportunities and results.
For example, there was relative little competitor advertising, so Oman's profile was stronger, and
the campaign led to the development of a customer database that has provided a foundation for
passenger growth from the UK. Additionally, our profile was further enhanced in April when
Oman AirOman AirLoading... introduced daily Airbus A300 services from Heathrow. A year on,
Oman AirOman AirLoading... now has 87 per cent market share of all air travel from the UK to
Oman, while visitor arrivals from the UK for the year ending June 2009 have increased 19 per
cent."
Arrivals from the GCC have also grown as a result of a consumer direct campaign launched by
the ministry jointly with Oman AirOman AirLoading... in February. "Now our focus with Oman
AirOman AirLoading... is on further developing the UK market and investing more heavily in
Germany and France for which Oman AirOman AirLoading... now operates non-stop services,"
Al Toobi (pictured) said. Other on-going initiatives designed to boost tourist inflows include an
intensive 'visiting journalist programme', the appointment of a new ministry representative in
Australasia, a video production for the Hong Kong and Chinese markets, and campaigns with
industry partners.
Also expected to pay dividends, the Under-Secretary said, are a host of major infrastructure
projects either managed directly by the ministry or by Omran, the state-owned tourism
development vehicle. "Omran is well advanced in the construction works for the 2010 Asian
Beach Games Village in Musannah, along with several hotel and resort projects here and in
regional locations. The ministry is delighted that funding has been confirmed for the construction
of a state-of-the-art convention and exhibition centre near Muscat International Airport.
These projects will allow Oman to secure international business and cultural events -- high
yielding visitor segments. The convention and exhibition centre will also be a platform to
showcase Oman's wider investment, trade and manufacturing sector," Al Toobi added.

Reference :

www.google.com

CONTENTS OF THE TERM PAPER:

Introduction in brief

Growth period of Indian tourism industry

The various segments within tourism

PESTLE Analysis

My view

Conclusion

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POLITICAL ANALYSIS:

In India, one can never over-look the political factors which influence each and every industry
existing in the country. Like it or not, the political interference has to be present everywhere. Given
below are a few of the political factors with respect to the tourism industry:
TERRORISM & SECURITY:Terrorism has an adverse effect on the growth and progress of any
country. Terrorism has also bad effect on the tourism industry if India. It is the big political problem to
the governing party of the country. With the rise in terrorism the growth of tourism industry in the
disturbed parts of country has been at slew rate. The states like Jammu and Kashmir, Assam etc.
have a bad tourism output, which intern effects the countrys growth.
The govt. of India is taking steps in regard to tackle the terrorism by providing more security to the
tourists who are visiting such terrorist prone areas.
POLITICAL INSTABILITY:Political instability also has effect on tourism industry. Sometimes frequent
change of parties at state or central level have an impact on tourism policies and upliftment of tourist
sites, as the different parties have different approach to tourist industry.
INFRASTRUCTURE: Infrastructure development depends mainly upon the government or ruling
political party. There has been a great infrastructure development from last 20 years in India. The
better infrastructure has attracted more and more tourist in India that is why the tourists visited in
2000 were 684 million and 2004 were 760 million.
RELATIONS WITH NEIGHBOURING COUNTRIES: Relationship with the adjoining countries have
also a direct relationship with the tourism industry. The political relationship of India with most of
adjoining countries is good, but the tourist from near countries are not frequently visiting the country.
LACK OF INTERNATIONAL REPRESENTATION: One of problem that is because of political factor
is the lack of international representation of the country. Indian government does not givemuch
preference to representation of country internationally because of which tourism rate does not
increase by any surplus amount. Countries like Malaysia are representing their country
internationally which is giving boost their tourism.

ECONOMIC ANALYSIS:
Economic factor also play an important role in the analysis of the tourism industy. Better economic
factors help to drive more and more tourist from different countries as well as from domestic
market.The Tourism sector of Indian economy is at present experiencing a huge growth. The
Tourism sector of Indian economy has become one of the major industrial sectors under the Indian
economy. The tourism industry earns foreign exchanges worth Rs. 21,828 crore. Previous year the
growth rate of the tourism sector of Indian economy was recorded as 17.3% Some of the economic
factors that affect tourism industry are:

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GDP (GROSS DOMESTIC PRODUCT): Gross domestic product also plays major part in the
upliftment of tourism industry. The GDP of India is growing at constant pace, it was around 9% in
July,2008. Better growth of GDP has helped to attract more and more tourist. The tourism will also
help to raise the GDP of India as if more and more tourist arrive they will spend more money which
inturn raise the GDP of country.
RISE IN NATIONAL INCOME: The Indian tourism is one of the major contributors in increasing
national income and improving the economic conditions of India. US $ 4810 were generated in year
2004 alone from tourism industry and it has increased upto 36% from previous year 2003.
BETTER ECONOMIC CONDITIONS: If we talk about the indian tourism industry, the rise in the
output is not only because if the foreign tourists but the domestic tourism has also been spreading its
wings and adding much more to tourism industry. As the economic condiions has been getting better
from last decade and so people are now spending much on tours and travelling.

SOCIAL ANALYSIS:
Social factor are those factors that affect the tourism industry because of the society. Social factors
have more or less a significant impact on Indian tourism industry. Some of the social factors that I
have analysed, that effect tourism industry of India are:
DEMOGRAPHIC CHANGES:Demographic trends describe the changes in demographics in a
population over time. In India majority of the population is of the young people, who are willing to
spend and to visit different parts of the country, thus one of this social factor has helped in
development of tourism industry majority of population i.e, 50% is under the age of 23 years.
VAST CULTURE: As we all know that the India is country of various religion and has oldest culture.
India is often called subcontinent. The Indian culture drives more and more foreigners to visit the
country. The is so much vastness in Indian culture and demographics that the tourists find it better to
visit country like India as compared to any other country as they find various and vast cultures in
India.
HEALTHIER LIFESTYLE: India provides trends to the healthier lifestyle, one of the biggest example
is of YOGA . most of the foreign tourist also visit India because of this purpose as they find new and
better ways that could keep them healthy in their day to day sy lifestyle.
LANGUAGE: The Indian population is also good at speaking English language, so this factor plays
an indirect part in the upliftment of the tourism industry. The foreigners do not find it much difficult to
convey themselves to the people.

TECHNOLOGICAL ANALYSIS:Technology always plays an vital role in any sector, so it has also
played its part in tourism industry. Some of the major technological factors that affect the industry if
tourism are as under:
MEDICAL TOURISM:Medical tourism has emerged in India from 1995, the medical industry is
driving more and more foreigners to come to India for their treatment. India is cheap at medical
procedures and technologically advanced than the other countries. Around 1.5 lacs of tourist visited
India just for medical purposes, which generated $300 million alone .Thus this one technological
factor is attracting more and more crowd to India.
IT SECTOR:IT sector is one of the sector in which India is getting advanced day by day. It is driving
more and more foreign nationals and tourist to our country as its providing some job oppoturnity to
them, which inturn makes rise in growth of the tourism sector. There are many IT parks in India and
many IT hubs which techno savvy people from abroad visit to learn new things.
ECOLOGICAL ANALYSIS: Environment is the main part of our lives that affect us directly.
Environment analysis is necessary for tourism industry as its dependent on environment.
Environment factor that has impact on tourism industry of India are:
GO GREEN IDEOLOGY: Go green ideology is one of the major steps taken by our government for
the preservation of environment. This ideology states that more and more trees should be planted
and less consumption of fuel should be done. This affects tourism industry directly as better
environment will drive more crowd to the country.

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GLOBAL WARMING: Global warming is one of the issues of concern of the whole world. Global
warming is effecting the tourism of India as glaciers of Himalaya and the various hill stations in the
Jammu and Kashmir and in Himachal Pradesh are facing trouble because of global warming as the
temperature and weather conditions are changing there dramatically.
SAVE TIGERS INITIATIVE: Tiger saving initiatives are also taking a pace ,because royal Bengal
tiger is world famous . People come from different countries to visit the national parks like
KAZIRANGA etc, the tigers are the main attraction to the tourists, so government is taking initiative
to save tigers.

LEGAL ANALYSIS: Legal factors of any country have an impact on its tourism. Various laws and acts
have direct relationship with the rise and fall in the rate of tourism. Some of the legal factors that
have impact on our tourism industry are given as under:
TAX EXEMPTION: The scheme and laws like tax exemption help to develop the tourism industry.
The tax exemption laws like, 50% of profit derived by travel agents and tours operators will only be
taxed. Such legal schemes are helping a lot in betterment of tourism.
INCREDIBLE INDIA: One of the aggressive advertisement campaign by tourism department is the
INCREDIBLE INDIA, it is a advertisement scheme for which the government pays the money. Many
banners and advertisment on various channels are shown, by this the ministry of tourism tries to
show various great places which can be visited in India.
LOW SPENDERS: Apart from the above stated schemes one of the legal drawbacks is that Indian
government does not spend much on the development and upliftment of tourism because of which
tourism industry is not getting the utmost best channel for performing the best.
FARES: Government also provides the facilities of the partly low fare to the foreigners in the railways
as well as in other services to show the kind treatment and hospitality to the foreigners, this will
generate the word of mouth publicity of the tourism industry which inturn is the positive sign of legal
factors.

OBSERVATION:
Cheap air fair is curbing the domestic tourism, as people are preferring to go to different places with
ease and in short time
Aggressive tourism strategy adopted by countries like countries like SINGAPORE and INDIA is still
lagging to implement such strategies.
High operation costs.
Medical tourism is emerging in India which is helping to generate better economy from it. $300
million generated in 2004.
Economic development has developed the pace of domestic tourism.
Personal disposable income during 2002-2007 grew at a CAGR of 14.16%, thereby driving
domestic as well as outbound tourism.
Royal trains and palaces attract the tourist who love the royal ways of living.

FUTURE OF THE TOPIC:


Inspite of overall recession and war of terrorism, the future looks bright:
Common wealth games 2010, is one of the huge opportunity by which the tourism industry could
expect to generate high revenues.

Increased hotel facilities , the accommodation will be easier for the tourists.
Development of the infrastructure has already begun and this will help in boosting the tourism.
Various GO GREEN & SAVE TIGER initiatives are adding to a better India.
Fight war of terrorism to sustain.

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