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Travel and tourism

sector: Potential,
opportunities and
enabling framework
for sustainable
growth
December 2013

2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

Travel and tourism sector:


Potential, opportunities and enabling
framework for sustainable growth
Theme Paper

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Message
The Indian tourism and hospitality industry has emerged as one of the key drivers
of growth among the services sector in India. Tourism in India is a potential game
changer. It is a sun rise industry, an employment generator, a significant source of
foreign exchange for the country and an economic activity that helps local and host
communities.
India is a tourism product which is unparalleled in its beauty, uniqueness, rich
culture and history has been aggressively pursuing the promotion of tourism both
internationally as well as in the domestic market.
Indian tourism industry is thriving due to an increase in foreign tourist arrivals and
greater number of Indians travelling to domestic destinations than before. In the past
few years the real growth has come from within the domestic sector as around 30
million Indians travel within the country in a year.
Indias demographic dividend of a younger population compared to developed countries
is leading to greater expenditure on leisure services. Travel and tourism sectors
contribution to capital investment is projected to grow at 6.5 per cent per annum during
2013-2023, above the global average of five per cent.

Arjun Sharma
Chairman, CII Tourism Fest 2013
Co-Chairman, CII National
Committee on Tourism and
Managing Director, Le Passage
to India

The Ministry of Tourism promotes the countrys various tourism products through its
tactile campaigns under the Incredible India brand- both for international as well as
domestic markets. The budget allocated for the Domestic Promotion & Publicity and
Overseas Promotion & Publicity including Marketing Development stood at INR 1.1
billion (USD 17.73 million) and INR 3.5 billion (USD 56.41 million) for the financial year
2013-14.
The ministry has set up a Hospitality Development and Promotion Board, which will
monitor and facilitate hotel project approvals. The allocation for Ministry of Tourism in
the Union Budget 2013-14 has been increased by INR 876.6 million (USD 14.13 million)
to INR 12,976.6 million (USD 209.30 million).
There is a need to take steps to improve the present scenario of tourism that includes
extending facility of visa-on-arrival to tourists from more countries, simple tax rules and
ensuring safety of tourists. There is a need for better marketing and brand strategies to
promote the sector. The cost of obtaining an Indian visa is prohibitive and we need to
take a relook at it. Creation of an enabling environment for the sectors growth would
lead to rise in foreign tourists inflows and foreign exchange earnings, thus, contributing
to economic growth. This would also lead to creation of additional jobs in the sector,
which would create opportunities for all sections of the society and in turn lead to
attaining an all-inclusive development.
Set against this backdrop, CII is organising a mega event CII Tourism Fest from 5 to
7 December 2013 in Chandigarh to bring all critical stakeholders like policy makers,
officials of Ministry of Tourism, State Governments, International Tourism Boards,
hoteliers, hospitals, tour operators and travel agents on one platform.
I hope that the deliberations not only reflect true voice of the industry, but also bring
all stakeholders together to think alike to kick off a new campaign to create & establish
roadmap for inclusive and seamless tourism.

2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

Foreword
The travel and tourism industry has emerged as one of the
largest and fastest growing economic sectors globally. Its
contribution to the global Gross Domestic Product (GDP)
and employment has increased significantly. Increasingly,
travel and tourism is emerging as an important category of
services exports worldwide.

Jaideep Ghosh
Partner
Management Consulting
KPMG India

With increasing tourist inflows over the past few years, it is


a significant contributor to Indian economy as well. As per
forecasts by the World travel and tourism Council its total
contribution to GDP is expected to witness a growth rate
of 12 per cent per annum during 2013-2023. Rising income
levels and changing lifestyles, development of diverse
tourism offerings and policy and regulatory support by the
government are playing a pivotal role in shaping the travel
and tourism sector in India.
However, the sector is facing challenges such as lack of good
quality tourism infrastructure, global concerns regarding
health and safety of tourists, disparate passenger/road tax
structures across various states and shortfall of adequately
trained and skilled manpower. While several plans and
programmes have already been devised for tackling these
challenges, successful implementation would be critical to
accelerate growth.
Concerted efforts by all stakeholders such as the central
and state governments, private sector and the community
at large are pertinent for sustainable development and
maintenance of the travel and tourism sector in the country.

2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

Table of

contents

Executive summary

01

Introduction 03
1.1

Global tourism industry

04

1.2

Indian tourism industry

05

1.2.1

Growth in number of tourists

05

1.2.2

Impact of tourism sector on GDP

06

1.2.3

Impact of tourism sector on employment

07

1.2.4

Capital investment in tourism sector

07

1.2.5

Growth of tourism in India Key drivers & trends

08

Performance of tourism sector in various states of India

09

2.1 Comparative assessment of major tourist states of India

10

2.2 Northern states in India

15

2.2.1 Growth of tourists in northern states

15

2.2.2 Profile of tourists in northern states

16

2.2.3 Role of government and private sector

18

2.2.4 Key tourism circuits in northern states

21

Seamless travel

23

3.1 Benefits of seamless travel

24

3.2 Case study: Seamless travel in European Union countries

24

3.3 Passenger/road tax structure in India

25

Key issues in tourism sector in India

27

4.1 Training and skill development

28

4.2 Safety and security of tourists

30

4.3 Healthcare for tourists

31

4.4 Infrastructure

32

Recommendations 34
About KPMG in India

35

About CII

36

2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

01

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Executive

summary

The travel and tourism industry has emerged as


one of the fastest growing sectors contributing
significantly to global economic growth and
development. While traditionally Europe and America
have remained among the tourism markets, new
emerging markets are expected to witness high
growth in international tourist visits over the next
decade.
India has significant potential to become a preferred
tourist destination globally. Its rich and diverse
cultural heritage, abundant natural resources and
biodiversity provides numerous tourist attractions.
The total tourist visits in India have been growing at
a steady rate of about 16 per cent over the past five
years. The travel and tourism sector in India provides
significant socio economic benefits. While the direct
contribution to GDP is estimated at INR 2222 billion
in 2013, the total contribution is estimated at INR
7416 billion in the same year. These have further been
forecasted to rise at a growth rate of 12 per cent
over the next decade. While the sector supported 25
million direct and 40 million total jobs in 2012, these
have been forecasted to increase at a growth rate of
2.1 per cent by 2023. Several industry drivers such
as government initiatives, diverse product offerings,
growing economy, increasing disposable income
levels and marketing initiatives along with key trends
such as increasing number of women and senior
citizen travellers, multiple short trips and weekend
holidays, introduction of innovative tourism concepts
and customised tour packages are playing a pivotal
role in shaping the Indian tourism sector.
Total tourist visits in various states of India over a
five year period reveal that while states of Karnataka,
Delhi, Punjab, Chhattisgarh, Tamil Nadu and Jammu
& Kashmir have improved their positions in 2012 as
compared to 2008, those of Uttar Pradesh, Rajasthan,
Uttarakhand, West Bengal, Himachal Pradesh and
Kerala have witnessed decline. Key attributable
reason to the success of tourism in states is the
increase in state investments towards the tourism
sector. While the key commercial and leisure

destinations of Delhi and Maharashtra enjoy good


quality transport and accommodation infrastructure,
states of Jammu & Kashmir, Uttarakhand, Himachal
Pradesh, Rajasthan and Jharkhand may need
significant improvements in their rail, road and airport
infrastructure.
Tourist visits in the northern states of India
witnessed a growth rate of 10.2 per cent during
2008-2012 compared to the national average growth
rate of 16.3 per cent during the same period. U.S.A.
and U.K. accounted for the maximum number of
foreign tourist visits in the northern states of India
in 2012. Fair share of tourists were received from
non English speaking countries like Germany, Japan
and UAE necessitating the availability of tourist
information in multiple languages. While tourists visit
states of Punjab, Haryana and Delhi for commercial
and business related purposes, states of Himachal
Pradesh, Uttarakhand, Jammu and Kashmir,
Rajasthan and Punjab are preferred as leisure
destinations. For religious tourism, they prefer states
of Rajasthan, Uttar Pradesh, Uttarakhand and Jammu
and Kashmir. While multiple tourism circuits based
on diverse themes exist across northern states,
low level of stay durations by both domestic and
international tourists indicates the need for more
entertainment and leisure activities.
Abundant natural and cultural resources in the
northern states provide ample opportunities for
development of diverse tourism products along
with a single integrated tourism circuit. While an
array of ancient and modern temples may provide an
opportunity for developing states in northern India
to emerge pilgrimage destinations, presence of
palaces, forts and historical monuments help define
their multi cultural heritage. Also, wildlife sanctuaries
with a wide variety of flora and fauna, mighty
Himalayas, rivers, deserts, climate and diverse
landscape provide attractive opportunities for thrill
and adventure activities.
Serene valleys of Himachal Pradesh provide an
opportunity to promote medical, wellness and

Source:
India Tourism Statistics 2008, Ministry of Tourism and http://tourism.gov.in/writereaddata/
CMSPagePicture/file/marketresearch/New/2012%20Data.pdf
WTTC travel and tourism economic impact 2013- India, Data taken at Nominal Prices

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

spiritual tourism in the state. Its topography


provides innumerable opportunities to promote
adventure tourism with sport activities like river
rafting, para-gliding, trekking etc. Scenic landscape,
castles, gardens and forts in the state of Jammu and
Kashmir attract tourists worldwide. Presence of holy
shrines, ancient temples and mosques also provide
an opportunity for promoting spiritual tourism.
Pilgrimage destinations in Haryana offer a wide
range of sacred places with religious and historical
significance. While Delhi is a major commercial and
business destination, it offers tourism opportunities
in form of political landmarks, national museums,
Islamic shrines, Hindu temples, green parks, trendy
malls etc. Punjab offers an opportunity for utilising
its culture, ancient civilisation, spirituality and epic
history for promoting tourism. Vast sand dunes
of the Thar desert in Rajasthan along with the
palaces and forts and rich cultural heritage attract
tourists worldwide. While the glaciers, snow-clad
mountains, valley of flowers, skiing slopes and
dense forests in Uttarakhand are attractive tourist
destinations, presence of shrines and pilgrimage
destinations provides opportunity for promoting
spiritual tourism. The tourism sector in India faces
several issues which require immediate attention.
Several recommendations may be suggested based
on studies of successful domestic and international
tourism case studies.
Indias image needs to be projected as a safe and
secure tourist destination
Regulatory and policy changes may be introduced
in order to increase international tourist inflow
Private sector investments may be encouraged
through provision of fiscal and non fiscal incentives
for boosting infrastructure development
New tourist destinations may be identified and
further development of the same for offering
innovative tourism products or experiences

02

Integrated tourism circuits may be developed


across states based on attributes, tourism
potential, current and future connectivity and
synergy within destinations
Seamless travel may be facilitated across
integrated circuits through introduction of
integrated taxation regime, linkages between
various public transportation modes and
improvements in highway infrastructure such as
petrol pumps, clean drinking water kiosks and
sanitation facilities, road signages etc.
Joint marketing programmes may be developed,
usage of publicity material like brochures, print
creative, audio video presentations, short films,
radio jingles, online creatives and advertisements
over media channels may be promoted and
innovative marketing techniques over social media
channels may be adopted along with increased
involvement of local travel trade partners for
promoting tourism in integrated circuits
Participation in international events may be
increased and customised tour packages with
competitive pricing may be developed keeping
in mind the profile of visitors, budget and travel
requirements
Training and skill development programmes
may be introduced in order to not only meet the
anticipated manpower shortfall but also develop an
adequately skilled workforce
Local community involvement may be encouraged
through awareness programmes and workshops
for sustainable development and maintenance of
tourism in the country.
Successful implementation of such
recommendations may be achieved through
government ownership of development programmes
and active participation and involvement of private
sector.

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03

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Introduction

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

1.1 Global tourism industry


The travel and tourism industry has
emerged as one of the largest and
fastest growing economic sectors
globally. According to the United
Nations World Tourism Organization
(UNWTO) Tourism Highlights 2013,
tourisms total contribution to
worldwide GDP is estimated at 9 per
cent. Tourism exports in 2012 amounted

to USD 1.3 trillion accounting for 6 per


cent of the worlds exports. New tourist
destinations, especially those in the
emerging markets have started gaining
prominence with traditional markets
reaching maturity. Asia Pacific recorded
the highest growth in the number of
international tourist arrivals in 2012 at 7
per cent followed by Africa at 6 per cent.

Figure 1.1: International tourist arrivals, million

Source: UNWTO Tourism Highlights, 2013

International tourist arrivals are set


to increase at a growth rate of 3.3
per cent per annum and amount to
approximately 1.4 billion by 2020 and
1.8 billion by 2030 implying an increase
of 43 million international tourist arrivals
each year.
While international tourist arrivals in
Europe and America are expected to
witness modest growth rates of 2.5
per cent and 2.2 per cent respectively
by 2030, Africa and Asia Pacific regions
are expected to witness higher growth

rates at 5.7 per cent and 5.0 per cent


per annum during the same period.
The global travel and tourism industry is
expected to witness certain key trends:
Increased inter region travel and
hence increased air travel
Arrivals for the purpose of visiting
friends and relatives, health, religion
etc. are expected to witness faster
growth than those for business and
professional purposes

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04

05

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

1.2 Indian tourism industry


The travel and tourism sector holds
strategic importance in the Indian
economy providing several socio
economic benefits. Provision of
employment, income and foreign
exchange, development or expansion
of other industries such as agriculture,
construction, handicrafts etc. are some
of the important economic benefits
provided by the tourism sector. In
addition, investments in infrastructural
facilities such as transportation,

accommodation and other tourism


related services lead to an overall
development of infrastructure in
the economy. According to the
World Economic Forums Travel and
Tourism Competitiveness Report
2013, India ranks 11th in the Asia
pacific region and 65th globally out of
140 economies ranked on travel and
tourism Competitiveness Index. India
has been witnessing steady growth in
its travel and tourism sector over the

past few years. Total tourist visits have


increased at a rate of 16.3 per cent
per annum from 577 million tourists in
20081 to 1057 million tourists in 20122.

1.2.1 Growth in number of tourists


With the international tourist arrivals
in India (pegged at 7.5 million in 2013)
expected to witness an annual growth
rate of 6.2 per cent over the next
decade, visitor exports (expenditure
generated by foreign tourists) are
expected to amount to INR 2958 billion
by 2023 growing at 9.6 per cent per
annum3.

This growth can mainly be attributed to


the rising income levels and changing
lifestyles, diverse tourism offerings
and policy & infrastructural support by
the government such as simplification
of visa procedures and tax holidays for
hotels.

Figure 1.2: Tourist visits in India, million

1. India Tourism Statistics 2008, Ministry of Tourism


2. http://tourism.gov.in/writereaddata/CMSPagePicture/file/
marketresearch/New/2012%20Data.pdf
3. WTTC travel and tourism Economic Impact 2013- India, Data
taken at Nominal Prices

Source: India Tourism Statistics 2008, 2009, 2010, 2011, Ministry of Tourism
http://tourism.gov.in/writereaddata/CMSPagePicture/file/marketresearch/New/2012%20Data.pdf
Note: Domestic and foreign tourist visits to various states and union territories in India

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

1.2.2 Impact of tourism sector on GDP


The travel and tourism sector directly
contributed INR 1920 billion to Indias
GDP in 2012 reflecting a growth
CAGR of 14 per cent since 2007. This
is forecasted to grow at a CAGR of 12
per cent from the estimated INR 2222
billion in the year 2013 to INR 6818
billion by 20234.

Figure 1.3: Travel and tourism direct contribution to GDP, INR Billion

Source: WTTC travel and tourism Economic Impact 2013- India, Data taken at Nominal Prices

While Figure 1.3 reflects the direct


contribution of the travel and tourism
sector, the total contribution is
expected to be much higher. In
addition to the impact of economic
activities directly related to the
sector such as accommodation,
transportation and entertainment, the
total contribution of the sector also
takes into account the indirect impacts
of investment or supply chain activities
and induced income impacts resulting
from spending by employees directly
or indirectly related to the sector.

For details on components of total


contribution, please refer to Box 1.
Such indirect and induced contribution
of the industry results in a multiplier5
impact on the overall economy.
Applying this multiplier impact, the
total contribution of travel and tourism
amounted to INR 6385 billion in 20124,
around 3.3 times its direct contribution.
This implies that for every rupee of
direct contribution of tourism to GDP,
additional 2.3 rupees is contributed
to the economy when the indirect
and induced effects of tourism are
considered.

In the year 2012, indirect and induced


contributions amounted to INR 3500
billion and INR 966 billion respectively.
The total GDP contribution is
forecasted to rise at a CAGR of 12 per
cent over the next decade with indirect
and induced contributions forecasted
to amount to INR 12939 billion and INR
3263 billion respectively by 20234.

4. WTTC travel and tourism Economic Impact 2013- India, Data


taken at Nominal Prices
5. A multiplier measures total change throughout the economy from
one unit change for a given sector

Box 1: Components of total contribution to GDP


1. Direct contribution: The direct
contribution of travel and tourism
to GDP is calculated from total
internal spending by netting out
the purchases made by different
tourism sectors such as hotels,
airlines, airports, travel agents and
leisure and recreation services that
deal directly with tourists. Internal
spending is total spending within
a particular country on travel and
tourism by residents and nonresidents for business and leisure
purposes as well as government

spending on travel and tourism


services, directly linked to visitors
such as cultural or recreational
services.
2. Indirect contribution: It consists of
the GDP supported by investment
activities in travel and tourism
sector such as purchase of new
aircrafts and construction of new
hotels; government collective
spending in the sector on areas like
tourism marketing and promotion,
aviation, administration, security
services, resort area security

services, resort area sanitation


services etc. and domestic
purchases of goods and services
by the sectors dealing directly with
tourists such as purchase of food
and cleaning services by hotels,
of fuel and catering services by
airlines, and IT services by travel
agents.
3. Induced contribution: It consists
of the GDP supported by the
spending of those who are directly
or indirectly employed by the travel
and tourism industry.

Source: WTTC Travel & Tourism Economic Impact 2013- India

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06

07

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

1.2.3 Impact of tourism sector on employment


The travel and tourism sector
supported 25 million jobs in 2012
directly related to the tourism sector.
Constituting 4.9 per cent of the total
employment in the country in 2012,
this is expected to amount to 31
million jobs by 20237.
While these numbers indicate direct
employment supported by the tourism
sector reflecting employment by

hotels, travel agents, passenger


transportation services or other
restaurant and leisure employment,
the total contribution including indirect
and induced effects is expected
to cause a multiplier impact on
the economy resulting in greater
employment generation.
Applying this multiplier impact, the
travel and tourism sector supported

a total employment of 40 million jobs


in 2012 constituting 7.7 per cent of
the whole economy employment7.
This implies that for every job directly
supported by the tourism sector,
an additional 0.6 job is supported
in the economy when the indirect
and induced effects of tourism is
considered.

1.2.4 Capital investment in tourism sector


Capital investments in the tourism
sector include spending by all sectors
directly involved in the travel and
tourism industry. Spending by other
industries on specific tourism assets
such as new visitor accommodation
and passenger transport equipment,
as well as restaurants and leisure

facilities for specific tourism use


also form part of capital investments.
Such investments lead to social
development of an economy as
infrastructure created for tourism
purposes in areas of transportation,
accommodation etc. can also be
utilised by the community in general.
Figure 1.4: Capital investment in travel & tourism sector, INR billion

Source: WTTC travel and tourism Economic Impact 2013- India, Data taken at Nominal Prices

7. WTTC travel and tourism Economic Impact 2013- India, Data


taken at Nominal Prices

Capital investment in the travel and


tourism sector in 2012 was estimated
at INR 1761.4 billion amounting to
approximately 6.2 per cent of total
investment in the Indian economy. It is

expected to increase by 14.2 per cent


in 2013, and witness further annual
growth rate of 10.5 per cent by 2023
amounting to INR 5459 billion7.

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

08

1.2.5 Growth of tourism in India Key drivers & trends


The growth of the Indian travel and tourism industry is being impacted by several
industry drivers.

Domestic tourism
Healthy economic growth and rising income
levels

Inbound tourism
New product offerings

Outbound tourism
Rising disposable income with the Indian
consumer

Changing consumer lifestyles

Rich natural/cultural resources and


geographical diversity

Availability of low cost airlines

Government initiatives and policy support

Diverse product offerings

Multiple marketing and promotion activities

International events and increased business


travel

Easy finance availability

Healthy economic growth levels

Healthy economic growth

Host nation for major international events

Easy finance availability

Healthy economic growth and


rising income levels: Favourable
growth in the Indian economy, rise
in middle class population (National
Council of Applied Economic
Research (NCAER) Study: number of
middle class households expected
to increase from 31.4 million in 2010
to 113.8 million by 2025-20268)
and increasing levels of disposable
income with increased affinity for
leisure travel are some of the driving
forces.
Changing consumer lifestyles:
With more than 65 per cent9 of the
Indian population falling in the age
group of 15-64 years, Indian travelers
are more open to holidays and are
keen to explore newer destinations.
Diverse product offerings: Diverse
tourism offerings in India such as
rural, medical, pilgrimage, adventure
and various other forms are driving
tourism growth.
Easy finance availability: Increased
adoption of credit culture and
availability of holidays on Equated
Monthly Installments (EMI) is
another growth driver.

8. http://articles.economictimes.indiatimes.com/2011-02-06/
news/28424975_1_middle-class-households-applied-economicresearch
9. http://www.ncaer.org/popuppages/EventDetails/IPF_2012/
ShekharAiyarandAshokaMody.pdf

Rich natural/cultural resources


and geographical diversity:
With 28 world heritage sites, 25
bio-geographic zones along with
a 7000 km10 long coastline India
abounds in natural resources and
offers a rich cultural heritage through
multiple religions, traditions, fairs and
festivals.
Government initiatives and policy
support: Rise in FDI in the tourism
sector (sector attracted second
highest FDI in 2013 at USD 3.2
billion10 as on Feb 2013) is providing
fillip to its growth. Policy actions
such as 100 per cent FDI, plans for
extension of visa on arrival scheme
to a larger number of countries and
a five year tax holiday for 2, 3 and 4
star category hotels located around
UNESCO World Heritage sites10
among others are expected to drive
future growth.
Host nation for major international
events: India is fast emerging as the
preferred nation for hosting of major
international events such as the
Commonwealth Games held in 2010.
Meetings, Incentives, Conventions
and Exhibitions (MICE) tourism is
on a rise on account of increased
business travel in India.

Attractive tour packages

There are several key trends shaping


the travel and tourism sector in India:
Visitor profile: With increasing
number of women joining the
Indian workforce, the number of
women business travelers is on a
rise (women business travellers
approximated at 25 per cent of the
total number of travellers in 2011
are set to witness a significant
growth of 891 per cent by 203011).
Population aged 65 years and above
is emerging as an important category
of Indian travellers (senior travellers
approximated at 1.3 million in 2011,
are set to rise to 7.3 million by 203011).
Purpose of travel: While religious
and social travel has and is expected
to remain the biggest contributor,
increased travel has been witnessed
in the form of weekend getaways
and family visits to foreign
destinations.
Diverse offerings: New concepts
such as medical, adventure, cruise,
rural, golf, wellness, luxury &
heritage tourism each with its
distinct characteristics and offerings
are increasingly playing a pivotal
role in attracting tourists. In addition,
customised tour packages with
offbeat destinations and newer
experiences are fast gaining ground.

10. IBEF report on Tourism & Hospitality August 2013


11. http://articles.economictimes.indiatimes.com/2013-04-14/
news/38529310_1_direct-flights-indians-thai-airways

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09

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Performance of
tourism sector in
various states of
India

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

10

2.1 Comparative assessment of major tourist states of India


Table 2.1 compares the states of India on the basis of their market share.
Table 2.1: Major tourist states of India by number of tourists

Rank in
2012

Number
of tourist
visits
(mn) in
2012

CAGR
(20082012)

Rank
improvement
(2008-2012)

Tourism
spend
(INR
mn)
2011-12

% of Overall
likely state
expenditure
2011-12

Andhra Pradesh

207

12%

106

0.02%

Tamil Nadu

188

17%

307

0.13%

Uttar Pradesh

170

8%

(1)

261

0.06%

Karnataka

95

64%

2400

0.63%

Maharashtra

71

33%

4855

1.16%

Madhya Pradesh

53

24%

727

0.32%

Rajasthan

30

0.2%

(3)

281

0.10%

Uttarakhand

27

7%

(1)

1111

1.42%

Gujarat

25

12%

2691

0.71%

West Bengal

10

24

4%

(2)

430

0.19%

Bihar

11

23

17%

304

0.14%

Delhi

12

21

47%

155

0.10%

Jharkhand

13

20

36%

250

0.20%

Punjab

14

19

147%

224

0.19%

Himachal Pradesh

15

16

13%

(3)

174

0.52%

Chhattisgarh

16

15

141%

479

0.29%

Jammu & Kashmir

17

13

13%

1392

2.11%

Kerala

11

7%

(5)

1530

1.27%

All India

1057

16%

23991

0.49%

State

Source: India Tourism Statistics 2008 Ministry of Tourism


http://tourism.gov.in/writereaddata/CMSPagePicture/file/marketresearch/New/2012%20Data.pdf
State wise/Sector wise Annual Plan 2011-12, Planning Commission

Andhra Pradesh has consistently


stayed on top of the list during
2008-2012 even with a low level of
state expenditure spend towards
tourism sector. Being a major
pilgrimage destination, it witnessed
the highest number of tourist visits
in 2012. Availability of good quality
infrastructure further supports the
growth of tourism. Tamil Nadu is
another major pilgrimage destination
in the south with major tourist

attractions as Chennai, Madurai and


Rameshwaram.
Karnataka witnessed the largest
increase in rank with increased
spend towards tourism sector at
0.63 per cent of the overall likely
state expenditure during 2011-12.
The effectiveness of its marketing
campaign is evident from the fact that
its website popularity improved by 7
ranks from 13 in 2009 to 6 in 2011.

Delhi being a key commercial and


leisure destination in the country
enjoys the necessary infrastructure
and high number of tourist visits
Maharashtra, a key commercial and
business destination scores well
on all infrastructural, economic and
demographic parameters with fifth
largest number of branded rooms per
sq km of area, fifth largest GDP per
capita in the country and 83 per cent
state literacy rate1

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11

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Gujarat with 0.71 per cent of state


expenditure allocated for the tourism
sector witnessed a considerable
increase in its budgetary allocation
proportion. With the success of
the Gujarat tourism campaign with
the brand ambassador as Amitabh
Bachchan and other marketing and
promotional activities, Gujarat has
improved upon its tourism appeal
many fold. For a detailed case study
on Gujarat, please refer to Box 2
Marketing and promotional
campaigns such as Bioscope :
Hindustan Ka Dil Dekho in
2006, Eyes Campaign and
advertisements with hand
shadowgraphy with the theme
as MP ajab hai, sabse gajab hai in
2010 helped Madhya Pradesh gain

position amongst the top 10 tourist


states of India. New ad campaigns
based on the idea of presenting the
state through beautiful, vivid colours
in 2013 are expected to further
augment the tourism potential of the
state2
Rajasthan, West Bengal, Himachal
Pradesh, Uttarakhand and Kerala are
states that have witnessed decline
in their positions as preferred
tourist destinations. While an
increase in funds allocated towards
tourism sector in these states is
required, effective implementation
of the funds may require careful
assessment of the impact of
marketing and promotion activities
in the state. Other areas requiring

consideration are improvements in


overall state infrastructure
While Kerala scores highest
on literacy levels, low GDP per
capita and low urbanisation levels
have had a negative effect on
the tourism appeal. However,
adequate infrastructure in areas
of accommodation and passenger
transportation along with the
governments focused marketing
and promotion activities are
expected to help Kerala regain its
lost position. For a detailed case
study on Kerala please refer to Box 3.

1. HVS State Ranking Survey 2011


2. http://www.exchange4media.com/50324_new-mp-tourism-adpasses-with-flying-colours.html

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Box 2: Case study on tourism in Gujarat


The state government of Gujarat has
taken multiple initiatives in order to
enhance the tourism appeal of the
state. Some of these are:
Land bank scheme: Areas have
been earmarked in the Gujarat
Industrial Development Corporation
estates and SEZs for development
of hotels, resorts, restaurants and
other tourist amenities. Concessions
are provided either on lease and its
tenure or on the rate to be charged
for government land and on stamp
duty and registration fee on land
transaction for tourism projects.
Tourism incentive package
scheme: Special incentives are
proposed to be provided over
2010-2015 including tax holidays on
luxury tax on hotels, reduction in
VAT charges on food and beverages
and natural gas, reduction in
entertainment tax, concessions
such as interest subsidy, reduction
of electricity duty and modifications
in the lending criteria to cover
wider tourism related projects like
amusement parks, wayside facilities,
service oriented projects like travel
agencies, tour operators etc.
Marketing & branding: Brand
campaign Khushboo Gujarat Ki was
launched with Amitabh Bachchan as
the brand ambassador to increase
awareness of the states diverse
tourism aspects. Several tourism
information centres have been
opened across India. The state
website has been launched in seven
different languages, especially
to cater to both national and
international tourists.
Exhibitions, events & road
shows: Gujarat tourism organises
several exhibitions and road shows
especially in the southern India for
marketing diverse tourism aspects
of Gujarat. Several road shows for
2013 have been planned in states
of Kolkata, Hyderabad, Guwahati,
Bangalore, Chennai, Ludhiana and
Aurangabad. Events such as kite
flying festivals are organised in
order to attract tourists from various

countries. In addition events like


Gujarat Tourism Summit and Gujarat
Travel Mart help create tourism
potential awareness across all
stakeholders. Gujarat tourism has
signed various MoUs with various
states such as West Bengal, Tamil
Nadu, Rajasthan, Kerala, Uttar
Pradesh and Himachal Pradesh for
collaborative tourism development.
Infrastructure development:
An outlay of INR 7.3 billion has
been planned for development of
tourism infrastructure in 22 districts
across the state. PPP is being
encouraged for the development of
accommodation facilities, booking
infrastructure, site operations and
retail and development of eight
tourism hubs. Government has
entered into a tie up with IL&FS to
develop 50 tourism sites and more
than INR 20 billion of tourism related
infra investments.
Kids tourism, golf tourism and
coastal tourism: Gujarat Tourism
plans to introduce kids tourism
during summer vacations in places
that would be of interest to kids.
Another new tourism concept
on Rama trail is planned to make
tourists experience the journey
that Lord Rama, Sita and Laxman
undertook as part of their 14-year
exile covering locations such as Sita
Van, Ram Sarovar, Unai and Shabari
Dham. For promotion of golf tourism
in the state, private golf courses
have been planned for development.
There are plans to develop cruise
terminals for dolphin sighting trips
etc. for boosting coastal tourism in
the state for which INR 1.6 billion
have been allocated across 16
identified beaches.
Training & skill development:
Training and skill development for
employees engaged in providing
tourism services through 335
Kaushalya Vardhan Kendras
providing vocational skills to rural
youth in various sectors including
tourism.

Source:
http://www.gujarattourism.com/downloads/
tourism_sector_profile_new.pdf
http://www.india.diplo.de/contentblob/3839178/
Daten/3075252/Economics_India_Figures_
Gujarat_VDMA_Report_DD.pdf
http://tourism.gov.in/writereaddata/
CMSPagePicture/file/marketresearch/
Tentavely%20Identified%20circuit%20for%20
various%20states/new/Gujarat.pdf
http://www.vibrantgujarat.com/images/pdf/
Service-Sector-Profile.pdf

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12

13

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Box 3: Case study on tourism in Kerala


Tourism initiatives in Kerala date
back to the 1980s. A comprehensive
tourism policy launched in 1995
kick started focused efforts towards
development of tourism which have
since then been followed by several
tourism planning and development
initiatives categorised as per following:
Policy initiatives: First state in
India to launch Tourism Vision 2025
strategy document. First to launch
Kerala Travel Mart as a permanent
organisation to promote tourist
attractions worldwide. Launched
the India International Boat show,
the first of its stature in South Asia.
Product development: Addition of
new tourist destinations, launch of
innovative products like houseboats,
tree houses and ayurvedic
rejuvenation. Identification of
backwaters and ayurveda as core
sectors of focus.
Marketing: Creation of specific
products accompanied with product
specific marketing and promotion
activities including invitations to
worlds leading travel magazines
and newspapers to discover
Kerala. 360 degree brand building
campaign Gods Own Country was
launched to utilise below the line
promotion activities in addition to
print and TV advertisements. Steps
were taken to improve the state
tourism website which was made
available in a number of languages
including English, French, German,
Italian and Spanish for targeting
visitors from these countries. In the
year 2008, Kerala Tourism became
the first state in the country to
develop tourism related web
content compatible with mobile
phones.
Infrastructure: Kerala Tourism
focused on developing the core and
linkage infrastructure both in terms
of accommodation units as well as
passenger transportation.

Tourism services: Focused on


building a critical mass of tourism
workers, increasing technical
skills, strengthening community
entrepreneurial skills and
augmenting managerial capacity.

While such initiatives have helped


Kerala strengthen its tourism appeal,
The Kerala Tourism Policy 2012 has
been launched to augment past efforts
and aid in developing a responsible
tourism movement in the state:
Tourism infrastructure
development: Task force on
infrastructure development to
be launched for development of
local leisure destinations, wayside
facilities and provision of tourist
information centres at major
tourist destinations. Around 11
infrastructure projects with an
outlay of INR 50 billion have been
planned over the next four years
including a tourism complex at
Veli in Thiruvananthapuram and an
Ayurveda manufacturing unit at
Punalur.
Encouraging investment: Steps
to encourage PPP participation such
as fast track clearance to tourism
projects with investment above INR
0.1 billion, residential tariff for home
stays and other fiscal and non fiscal
incentives.
Brand building: Kerala Convention
Promotion Bureau (KCPB) plans to
market Kerala aggressively in the
MICE business segment especially
in countries of Australia and China.
Formulation of marketing strategies
and destination specific campaigns
along with usage of social
networking sites such as Facebook
and Twitter for promotional
campaigns is being implemented.
Participation in both national and
international road shows/fairs such
as Top Resa, Paris; JATA Travel Mart,
Tokyo; WTM, London; ITB, Berlin
etc. and conducting workshops in
countries such as Geneva, UK, New

York, Chicago, Los Angeles, Paris


etc. being carried out to attract
international tourists. International
Campaigns such as Your Moment
is Waiting reflect the increased
focus on attracting international
tourists.
Usage of IT & communication: In
the year 2012, Kerala became the
first state in the country to profile all
tourist destinations across the state
and to list services available along
with connectivity by integrating a
new set of mobile-based services
and IT-driven projects. Other
instances of IT usage include WAP
guide, applications for Android and
iOS and Bluetooth kiosks.
From products to experiences:
Plans to start Spice Route tourism
on lines of Silk Route tourism of
China which is expected to start
from Muziris port in Kerala up to
Venice in Italy passing through 31
countries.
Success of steps outlined above is
being reinforced through cooperation
and collaboration between various
stakeholders such as tour operators,
property owners, travel agencies,
government agencies etc. through
various partnership meets organised
by Kerala Tourism in various parts of
the country.

Source:
http://tourism.gov.in/writereaddata/
CMSPagePicture/file/marketresearch/
Tentavely%20Identified%20circuit%20for%20
various%20states/new/Kerala.pdf
http://www.keralatourism.org/international-fair/
http://www.business-standard.com/article/
economy-policy/kerala-tourism-plans-tostrengthen-digital-campaign-113081300889_1.
html
http://www.traveltechie.com/news/Keralatourism-plans-to-woo-tourists-from-USA-Japanmarkets/7175

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enabling framework for sustainable growth

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14

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

2.2 Northern states in India


2.2.1 Growth of tourists in northern states
Compared to the national average
growth rate of 16.3 per cent, the total
number of tourist visits in the northern
states of India witnessed a growth
rate of 10.2 per cent during the period
2008-20123. While the total number
of tourist visits in India amounted to
1057 million in 20124, those in northern

states amounted to 303 million in


the same year4. The domestic and
international tourist visits in northern
states witnessed growth rates of 10.4
per cent and 3.2 per cent respectively
during 2008-2012 amounting to 296
million domestic tourists and 7 million
international tourists in 20124.

Figure 2.1: Tourist visits in northern states of India, million

7.7%
170

2008

6.9%

21

10 16

8 13

21 27

2012

CAGR reflecting growth of tourist visits during 2008-2012

3.8%

0.2%
30 30

Rajasthan

6 7

Haryana

Uttarakhand

12.9%

UP

19

13.4%

J&K

0.5

46.9%

HP

146.9%

Delhi

126

Punjab

15

Source: India Tourism Statistics 2008 Ministry of Tourism


http://tourism.gov.in/writereaddata/CMSPagePicture/file/marketresearch/New/2012%20Data.pdf

The total market share of the Northern states in overall India tourist visits declined
from 36 per cent in 20083 to 29 per cent in 20124.
Figure 2.2: Market shares of northern states in overall tourist visits in India

Source: India Tourism Statistics 2008 Ministry of Tourism


http://tourism.gov.in/writereaddata/CMSPagePicture/file/marketresearch/New/2012%20Data.pdf

3. India Tourism Statistics 2008, Ministry of Tourism


4. http://tourism.gov.in/writereaddata/CMSPagePicture/file/
marketresearch/New/2012%20Data.pdf

The state of Punjab witnessed the


largest increase in market share of
1.7 per cent much of which can be
attributed to increase in the domestic
market share. Similarly the state of Delhi
witnessed a market share increase of
1.2 per cent during the same period.
While the domestic market share for
Delhi witnessed considerable increase
in 2012, the international market share
suffered a decline4.

Other northern states such as Rajasthan,


Haryana, Uttarakhand, Uttar Pradesh,
Jammu & Kashmir and Himachal
Pradesh witnessed decline in market
shares in overall India tourist visits. Uttar
Pradesh witnessed the largest market
share decline of 5.8 per cent followed by
Rajasthan, Uttarakhand and Haryana at
2.3 per cent, 1 per cent and 0.4 per cent
respectively.

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

2.2.2 Profile of tourists in northern states


In line with the overall tourist profile in
India, major proportion of tourist visits

in northern states of India comprised of


domestic tourists in 2012.

Figure 2.3: Tourist visits in northern states of India, 2012

Source: http://tourism.gov.in/writereaddata/CMSPagePicture/file/marketresearch/New/2012%20Data.pdf
Note: Northern states include Punjab, Delhi, HP, J&K, UP, Uttarakhand, Haryana and Rajasthan

Punjab witnessed the highest growth


rate both in terms of domestic (147%)
as well as international tourists
(114%) during 2008-20125. While Delhi
witnessed high growth in terms of
domestic tourists (72%), it witnessed
almost negligible growth (0.1%) in

international tourist visits during


the same period5. While Haryana
witnessed low growth in terms of
increase in domestic tourists, increase
in international tourists for the state
(28%) was second only to Punjab5.

Figure 2.4: Tourist visits in northern states of India by nationality

Source: Ministry of Tourism, Statistical Surveys for States

5. India Tourism Statistics 2008, Ministry of Tourism, http://tourism.


gov.in/writereaddata/CMSPagePicture/file/marketresearch/
New/2012%20Data.pdf
6. India Tourism Statistics 2011, Ministry of Tourism

U.S.A. and U.K. account for the


maximum number of foreign tourist
visits in the northern states of India.
This is in line with the overall India
figures where these countries
accounted for 16 per cent and 13 per
cent respectively for the total foreign
tourist visits in India in 20116.

Apart from English speaking countries


like U.K., U.S.A., Australia and Canada,
a fair share of foreign tourists arrive
from non English speaking countries
like Germany, Japan and UAE. Thus,
providing tourist related information on
the state tourism websites and at the
tourist information centers in multiple
languages may add to the convenience
of the foreign tourists.

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16

17

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Table 2.2: Proportion of total tourist visits in northern states of India by purpose of visit
Haryana
(2012)

Himachal
Pradesh
(2012)

Delhi
(2010)

Punjab (2010)

Business

31%

12%

38%

16%

Holidays, leisure & recreation

13%

48%

18%

47%

Social activity

20%

7%

20%

10%

Pilgrimage

13%

13%

6%

5%

Education

3%

3%

6%

7%

Medical

1%

1%

3%

3%

Others

23%

15%

8%

11%

Purpose of Visit

Source: Ministry of Tourism, Statistical Surveys for States


Note: Overlap in Purpose of Visit for state of Delhi
Others includes visits for getting work done, shopping etc.

While Haryana and Delhi are majorly


commercial and business related
destinations, Himachal Pradesh and
Punjab emerge clearly as destinations
preferred for leisure activities.

Education and medical appear as


areas that require focused efforts by
state governments for promotion and
marketing of the state avenues in
these fields to attract more tourists.

Table 2.3: Average duration of stay in northern states (Days)


Haryana
(2012)

Himachal
Pradesh
(2012)

Delhi
(2010)

Punjab (2010)

Domestic

1.3

1.8

1.2

1.1

International

1.5

2.4

1.2

1.4

Total

1.3

1.9

1.2

1.1

Visitor

Source: Ministry of Tourism, Statistical Surveys for States

Himachal Pradesh witnessed


the longest duration of stay by
both domestic and international
tourists which is evident because
of its preference as a state for
leisure and vacationing purposes.
Average duration of stay is highest
for the month of September for
domestic tourists and December for
international tourists. Delhi primarily
a business centre witnesses more of

business and work related tourists


with short stay durations. There is a
need for enhancing the infrastructure
and tourism appeal of the states in
northern India in order to achieve
longer tourist stays. Special strategies
and promotion activities may be
adopted by the state governments
especially in peak months in order to
increase the stay duration for tourists.

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

2.2.3 Role of government and private sector


States in North India have adopted multiple tourism strategies in order to enhance
the tourism potential. Various fiscal incentives and investor friendly policies are
being adopted by the state governments for development of state infrastructure.
Table 2.4: Incentives & policy support by state governments in northern states
State

Fiscal incentives

Policy support

Tourism/civic infrastructure development plans

Himachal
Pradesh7

10 year tax holiday for entertainment units


Deferred payment of luxury tax by hotels
and tourism units
Special incentive package for satellite
towns and cyber cities with investment of
over USD 21.5 million by NRIs and foreign
investors

Special priority to Tourism sector for


grant of power connections
Single window clearance
Destination Himachal Funds for
marketing activities

Development Institution Funding of USD 95 million


from ADB
Increase in helipads to 70, aerial ropeways at 12
identified places, wayside amenities, spas and
resorts, ski slopes, tourist centres, multiplexes,
parking, amusement parks, golf course, 4/5 Star
Hotels, budget accommodation etc. at priority areas

Punjab8

Land allotment on easy terms for


developing hotels on selective basis
Provision of soft loans for new tourism
projects and expansion of existing ones

Collaboration with UNWTO for technical


assistance
Sikh Circuit Tourism Plan worth INR 2.5
billion
Single window clearance

PPP development of roads, expressways, hotel


management institutes, hotels and convention
centres, tourist complexes, sports complex, parking
facilities etc.

Haryana 9

INR 1 billion and above or employing


more than 500 persons projects- financial
assistance at 50% of tax paid for seven
years (five years for investment up to INR
30 million) as Interest Free Loan (IFL) for
five years
Five year exemption from electricity duty
Customized incentives- INR 0.3 billion/
above projects
Facilitation of land auction and
institutional finance

Single window clearance


Task force headed by the Tourism
Minister for finalization of tourism
proposals
Declaration of Special Controlled Areas
from Tourism point of view

Development of Gurgaon as convention, exhibition


hub and golf city along with adventure sites, theme
parks, camping sites in Sohna and Damdama,
Kurukshetra as a pilgrim destination & Morni, Kalesar
and Sultanpur as eco tourism sites
Planned upgradation of existing resorts, setting
up theme parks and multiplexes, Tourist Reception
Centres

Uttarakhand10

Three year 100% entertainment tax


exemption; 30% for further five years
Five year 100% exemption for new
amusement parks, ropeways
Capital investment subsidy in new project
at ceiling of INR 3 million
Five year Rebate/ Deferred payment of
luxury tax for new units
20% assistance for investments up to INR
1 million
Land availability on reasonable terms/
price or as equity

Single window clearance


Government rest houses to be utilised
for tourism
Provision of beer bar licenses to hotel
units with attached restaurant facilities
Establishment of separate funds for
tourism development

Concessions for infrastructure projects on merit basis


Five ropeway projects and connectivity improvements
for identified seven tourism zones
Adventure centers planned at 19 locations
for promoting outdoor activities like trekking,
mountaineering, river rafting, kayaking, canoeing,
rowing, water and snow skiing
Focus on infrastructure development through PPP

Jammu &
Kashmir11

Capital subsidy for taxi operators up to


INR 0.7 million
Capital investment subsidy up to INR 10
million for tourism units more than INR
250 million
Investment subsidy for modernisation of
travel agencies to 50% of project cost

Single window clearance


Special area development programme
in place for heritage conservation of old
Srinagar city

INR 1.2 billion allocation during 2012-13 for


infrastructure development and upgradation through
public investment
Development of nine and 18 hole golf courses,
chairlift facilities, Yatri Niwas, clubs and youth
hostels, museums, tourist resorts, convention centres,
renovation of heritage sites, industrial training
institutes etc.

DG subsidy- INR 0.4 million


Timber subsidy for houseboat repairs
Subsidy for adventure equipment up to
INR 0.7 million

7. Himachal Pradesh Tourism Policy 2005


http://www.pppinindia.com/state-policy-himachal-pradesh.php

9. Haryana Tourism Policy 2008


http://www.pppinindia.com/ppp-initiatives-haryana.php

8. Punjab Tourism Policy 2009


http://www.pppinindia.com/state-policy-punjab.php

10. Uttarakhand Tourism Policy 2001

11. http://www.pppinindia.com/policy-initiatives-jammu-kashmir.php
www.jandkplanning.com/images/Economic_Survey/32-tourism.
pdf

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18

19

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Table 2.4: Incentives & Policy Support by State Governments in Northern states
State

Fiscal Incentives

Policy Support

Tourism/Civic Infrastructure Development plans

Rajasthan15

Exemptions for new tourism units for


seven years: 100% luxury tax, 50% stamp
duty, 50% entertainment duty, 50%
electrical duty, 50% conversion charges
Interest subsidy to hotel, motel etc.
Low land conversion charges at select
areas
Liberal Floor Area Ratio at two
Facilitation of institutional finance

Single window clearance


Simplification of rules for land allotment
& conversion
Expeditious disposal of applications
Usage of government buildings for
tourism
Simplified and time bound procedures for
hotels for obtaining bar license

25-year vision for infrastructure development


including tourism sector
Promotion of PPP in development of accommodation
units and hotels
Establishment of modern well equipped tourist
reception centres at important entry points and
destinations

Uttar
Pradesh16

Five year exemption/deferred payment


for luxury, entertainment tax for new
ropeways, trade tax for restaurants
Entertainment tax exemption for paying
guest scheme units
100% exemption from stamp duty
Interest free loan for pioneer units
Heritage hotels and capital investment
subsidy schemes with a subsidy of 10%
Facilitation of institutional finance and
financial assistance to units in hill areas

Single window clearance


Simplified approval procedures
Rationalised luxury tax assessment
Paryatan Mitra committee solving
entrepreneurial issues

Outlay of INR 34.6 billion planned during 2002-2022


for creation of connectivity and tourism infrastructure
Creation of special funds to finance infrastructural
facilities in identified circuits
Priority to develop basic infrastructure facilities
viz. roads, aviation services rail, surface and water
transport assured electrical supply, telecom facilities,
drinking water, sewage facilities and accommodation
through PPP

State governments are increasingly


recognising the role of private sector
participation in development of
tourist infrastructure. While capital
intensive destination development
projects may require government
funding and support, projects such
as setting up of hotels, convention
centres, golf courses etc. require
professional expertise and hence may

15. Rajasthan Tourism Policy 2007


http://www.pppinindia.com/state-policy-rajasthan.php
http://www.rajasthantourism.gov.in/App_Themes/Green/
NewHotel%20Policy/UDH-2013.pdf
http://www.rajasthantourism.gov.in/Quick-Links/
Touristunitpolicy2007.aspx

be developed through private sector


participation with the government
playing the role of a facilitator. An
example of increased private sector
participation in tourism development
initiatives is the state of Goa where
the government has taken several
key initiatives in collaboration with
the private sector. For a detailed case
study on Goa please refer to Box 4.

16. Uttar Pradesh Tourism Policy 1998


http://www.phdcci.in/admin/userfiles/file/Research-Bureau/
Uttar-Pradesh.pdf
http://tourism.gov.in/CMSPagePicture/file/marketresearch/
statewise20yrsplan/up.pdf

http://www.rajasthantourism.gov.in/Business/Investment-inHospitality.aspx

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Box 4: Case study on tourism in Goa


Goa started gaining popularity as a
tourism destination in the late 1960s.
Initially the government put in place
infrastructure to facilitate tourism
in the state and the private sector
was cautious on account of low
returns at that point of time. The Goa
Tourism Development Corporation
Limited (GTDC) was set up in 1982
as a public limited company, to look
after the commercial activities of the
government and to set up and maintain
tourism infrastructure in the state.
In the recent past, with significant
private sector investment and interest,
the government has shifted focus
to playing the role of a facilitator.
Recognising that tourism cannot
sustainably grow without private
sector investment and that a
passive approach to investors can

be detrimental to the states tourism


prospects, the government has been
partnering with the private sector in
several key initiatives. An early initiative
was the Goa International Tourism Mart
2010, which was jointly promoted by
the government and associations of
private sector entities in the tourism
industry.
The last couple of years have seen
several key initiatives taken in
collaboration with the private sector.
One of the examples is the formation
of a state-level marketing and
promotion committee with members
from the government and private
players in the tourism industry. The
terms of reference of the committee
includes putting in place procedures
and standards for marketing and
promotional activities. The Committee

Source:
http://www.hotelierindia.com/article-10093-investing_in_goa/

http://www.business-standard.com/article/pti-stories/brand-consultantfor-goa-tourism-industry-soon-minister-113040800226_1.html

http://articles.timesofindia.indiatimes.com/2013-05-31/goa/39654732_1_
goa-tourism-marketing-strategies-promotion-committee

http://articles.timesofindia.indiatimes.com/2013-09-25/goa/42392405_1_
cctv-cameras-goa-tourism-development-corporation-gtdc

Viable business models may be


developed for encouraging private
sector participation in activities such as:
Developing and managing operations
of tourist facilities at important
tourist places
Laying down industry standards,
ethics and fair practices in
consultation with the government

Actively participating in preservation


and protection of tourist attractions
Encouraging green practices
research and implementation
Taking steps to encourage local
community involvement in planning,
development and maintenance of
tourism projects

has the power to sanction and


authorise marketing and promotional
budgets allocated by the government
for promotion of Goa tourism. Some of
the other initiatives with private sector
involvement include constitution of
expert committees comprising of key
members of private players in the Goa
tourism industry for drafting of terms
of reference and evaluation/selection
of consultants. GTDC has recently
announced plans of forming joint
ventures with the private sector for
renovation of their existing properties
as well as development of new
properties.
These initiatives indicate a growing
collaboration between the public and
private sector and bode well for the
long-term sustainability of tourism in
Goa.

Providing adequate training and


skill development opportunities
for employment creation as well
as provision of quality services to
tourists
Undertaking promotion and
marketing activities for tourist
destinations in collaboration with
government.

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20

21

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

2.2.4 Key tourism circuits in northern states


States in North India have adopted multiple tourism strategies in order to enhance the tourism potential. Various fiscal incentives
and investor friendly policies have been adopted by the state governments for development of state infrastructure.
Table 2.5: Key tourism circuits in northern states of India
State

Major tourism circuits

Key tourist destinations

Punjab17

Amritsar circuit (Amritsar Ram Tirath - Sarai Amanat Khan -Wagha Border)
Pathankot circuit (Amritsar - Dera Baba Nanak - Qadian-Kalanaur- Gurdaspur)
Jalandhar circuit (Amritsar - Tarn Taran Hari Ke - Pattan - Goindwal Sahib - Sultanpur Lodhi
Kapurthala Kanjli lake)
Jalandhar circuit (Amritsar - Baba Bakala Kartarpur)
Chandigarh circuit (Chandigarh, Ropar (Rup Nagar)- Anandpur Sahib, Bhakra - Nangal, Ropar)
Faridkot circuit (Ludhiana - Moga - Ferozepur - Bhatinda - Malout Muktsar)
Chandigarh circuit (Patiala-Nabha-Malerkotla - Ludhiana - Fatehgarh Sahib Chandigarh Jalandhar Hoshiarpur, either back to Jalandhar or Ropar)
Identified circuits
Sikh Circuit (Akal Takht in Amritsar, SriKeshgarh Sahib in Anandpur and Sri Damdama Sahib at
Talwandi Sabo Bhatinda district)
Eco tourism circuit (Chandigarh - Ropar - Hoshiarpur - Talwara - Ranjit Sagar Dam)
Heritage circuit (Nabha - Patiala -Sangrur - Bathinda - Faridkot - Kapurthala)
Freedom trail (Patiala - Nabha - Malerkotla - Jagraon - Ferozpur - Amritsar - Ajnala)

Amritsar, Golden Temple, Wagah Border,


Patiala, Anandpur Sahib, Jalianwala Bagh

Delhi18

Delhi- Agra- Jaipur


Delhi- Agra- Jaipur- Khajurao
Delhi- Chandigarh- Amritsar
Identified circuits
Heritage circuit covering heritage monuments and structure in National Capital Region\
Religious circuit covering Akshardham, Bahai Temple, Jama Masjid, Nizamuddin Dargah, Gurdwara
Bangla Sahab etc.

Connaught place, Chandni Chowk, Raj


Ghat, Rajpath, Gurdwara Bangla Sahib,
Lodi Garden, Jantar Mantar, India Gate,
Red Fort, Qutab Minar, Lotus Temple

Himachal
Pradesh19

Dhauladhar circuit (Delhi -Chintpurni - Jwalamukhi -Kangra - Dalhousie - Khajjiar - Chamba Dharamsala - Chamunda - Palampur - Jogindernagar Delhi)
Beas circuit (Delhi - Swarghat - Bilaspur - Mandi - Rewalsar - Kullu - Manali - Rohtang - Naggar Manikaran - Delhi)
Tribal circuit (Delhi - Shimla - Sarahan - Sangla - Kalpa - Nako - Tabo - Dhankar - Pin Vally Kaza - Losar Kunzum - Koksar - Sissu - Tandi - Udaipur - Trilokpur - Rohtang Pass Manali - Delhi)
Sutlej circuit (Delhi - Parwanoo - Kasauli- Barog - Solan - Chail - Hatkoti - Rampur - Sarahan Narkanda - Naldehra - Tattapani - Shimla - Kiarighat - Delhi)
Identified circuits
Shimla Circuit (Kalka - Solan - Shimla- Chail - Kufri - Naldara)

Dalhousie, Shimla, Mandi, Hamirpur,


Chamba, Manali, Kullu, Solan,
Dharamshala, Kangra, Narkanda, Sarchan,
Rohtang

Dharamshala Circuit (Dharamshala - Kangra - Palampur - Chamba)


Jammu &
Kashmir20

Naagar Nagar circuit (Watlab Hazratbal Tumullah Mansbal - Wullur Lake


Identified circuits
Yousmarg Aharbal Pahalgam Verinag - Kokernag Kishtwar - Bhaderwah
Lakhanpur Basoli Surinsar Mansar Jammu Katra Shivkhori Shud Mahadev Patnitop
Nyoma Tangtse Leh Basgo Hundar(Nubra)- Turtuk (Nubra) Mangue Temigang - Khaltsi

Mubarak Mandi Heritage Complex,


Gulmarg, The Mughal Gardens of Kashmir,
Pahalgam, Sonamarg, Leh, Kargil, Vaishno
Devi

Uttarakhand21

Haridwar- Rishikesh- Muni- Ki- Reti


Identified Circuits
Dehradun Musoorie Dhanaulti Kanatal Rishikesh Haridwar - Dehradun
Corbett Nainital - Corbett
AdiBadri Simli Karyprayag Chamoli Pipalkoti Urgam VradhBadri Joshimath - Bhavishya
Badri -Yogdhyan Badri (Pandukeshwar) Tapovan Malari - Niti village
Nankmatta Tanakpur Purnagiri Champawat Lohaghat AbbotMount Pithoragarh - Jaul Jibi
- Madkot Munsiyari Shyama Kamkot Bageshwar Takula - Almora

Dhanaulti, Dehradun, Jim Corbett,


Mukteshwar, Mussoorie, Nainital,
Haridwar, Char Dham

17. http://tourism.gov.in/writereaddata/CMSPagePicture/file/
marketresearch/Tentavely%20Identified%20circuit%20for%20
various%20states/new/Punjab.pdf
18. http://www.destinations-india.com/famous-tourist-circuits.html
http://tourism.gov.in/writereaddata/CMSPagePicture/file/

marketresearch/Tentavely%20Identified%20circuit%20for%20
various%20states/new/Delhi.pdf
19. http://tourism.gov.in/writereaddata/CMSPagePicture/file/
marketresearch/Tentavely%20Identified%20circuit%20for%20
various%20states/new/HimachalPradesh.pdf

20. http://tourism.gov.in/writereaddata/CMSPagePicture/file/
marketresearch/Tentavely%20Identified%20circuit%20for%20
various%20states/new/Jammu.pdf
21. http://tourism.gov.in/writereaddata/CMSPagePicture/file/
marketresearch/Tentavely%20Identified%20circuit%20for%20
various%20states/new/Uttarakhand.pdf

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

22

Table 2.5: Key Tourism Circuits in Northern states of India


State

Major Tourism Circuits

Key Tourist Destinations

Uttar
Pradesh22

Agra- Braj
Varanasi- Sarnath- Ramnagar
Mahabharat circuit (Hastinapur- Baghpat Bijnor)
Ram Van-Gaman Yatra circuit (Ayodhya, Bharatkund, Belha Devi-Pratapgarh, Shrangverpur, Allahabad,
Chitrakoot)
Circuit related to Ist War of Independence in 1857: (Jhansi Meerut Lucknow Raibareily Unnao
Kanpur Bithoor Sitapur Badaun Bareilly Hathras Shahjahanpur Mainpuri Firozabad
Gorakhpur Devaria Azamgarh Balia Varanasi - Allahabad)
Jain Circuit (Shravasti Kaushambi Allahabad Ayodhya Faizabad Ronahi Kampil Hastinapur
Sauripur Agra Banaras Kushinagar
Sikh Circuit (Gurudwara Pakki Sangat (Allahabad)- Gurudwara Ahrora, Gurudwara Chota & Gurudwara
Bhuili (Mirzapur)- Gurudwara Nichibagh, Gurudwara Gurubagh (Varanasi - Guru Teg Bahadur Ji ki Tapsthali,
Chachakpur, Gurudwara Raasmandal (Jaunpur)- Gurudwara Brahmkund (Ayodhya)- Gurudwara Ahyiyaganj
(Lucknow)- Gurudwara Singh Sabha (Mathura)- Gurudwara Hathighat, Gurudwara Guru ka Taal (Agra))
Sufi Circuit (Fatehpur Sikri Rampur Badaun Bareilly Lucknow Kakori - Dewasharif (Barabanki)
Bahraich - Kichocha Sharif - Kade Shah - Kada (Kaushambi) Allahabad - Kantit Sharif (Mirzapur))
Christian circuit ( Merut-Sardhana Agra Kanpur Lucknow Allahabad Varanasi Gorakhpur)
Handicraft circuit (Lucknow Agra Aligarh Firozabad Rampur Kanpur Kannauj Vrindavan
Muradabad Khurja Varanasi Bhadohi Mirzapur Chunar Jaunpur Gorakhpur)
Identified circuits
Awadh - Ayodhya circuit
Allahabad- Varanasi circuit
Uttar Pradesh buddhist circuit

Taj Mahal, Agra Fort, Fatehpur Sikri, forts


at Allahabad, Jhansi, Bithoor, Lucknow,
Varanasi, Sarnath

Haryana23

Panipat- Kurukshetra- Pinjore


Kurukshetra-Pehowa-Hardwar-Hodal
Identified circuits
Kalka - Panchkula Naraingarh - Yamuna Nagar Kurukshetra - Thanesar Pehowa - Panipat
Rohtak Meham Hansi Hissar Dabwali
Surajkund Damdama Lake Faridabad (Badhkal Lake) Palwal
Mahendragarh Madhogarh Narnaul

Ambala, Karnal, Panchkula, Kurukshetra,


Jyotisar, Thanesar, Morni Hills, Pinjore

Rajasthan24

Dhundhar circuit (Jaipur Amer - Dausa)


Hadoti circuit (Bundi - Kota - Jhalawar)
Merwara-Marwar circuit (Ajmer- Nagaur)
Mewat-Brij circuit (Alwar Bharatpur - Ranthambhor - Tonk)
Vagad circuit (Dungarpur - Banswara)
Shekhawati circuit (Sikar - Jhunjhunun - Churu)
Godwad circuit (Mount Abu - Ranakpur - Jalore)
Identified circuits
Desert circuit (Jodhpur Bikaner - Jaisalmer)
Jaipur Ajmer - Pushkar
Chittaurgarh Udaipur Mt. Abu
Udaipur Ranakpur Kumbhalgarh Nathdwara

Alwar, Dargah Sharif-tomb of the Sufi saint


Khwaja Moinuddin Chisti at Ajmer
Palaces and forts at Bundi, Diwan-e-aam,
Hathia Pol, and Naubat Khana at Bundi,
Bikaner, Jaisalmer fort, Jodhpur, Mount
Abu, Ranthambor National Park, Udaipur,
Jaipur

Multiple tourism circuits across states


based on varied themes of pilgrimage,
adventure, natural flora and fauna,
cultural heritage, national history,
famous personalities, moments, rivers
and other topographic diversity provide
ample opportunities for increasing the
tourism potential of northern states
of India. This may further be enhanced
through:
Identification and development
of new tourism circuits or
enhancement of existing ones

Development of integrated circuits


in collaboration with neighboring
states
Infrastructural development
focusing on tourist destinations as
well as civic infrastructure
Encouragement for private sector
participation in form of financial
incentives such as lower taxes,
subsidies, easy finance options or
availability of land banks
Establishment of required
administrative set up

Development of innovative
marketing and promotion techniques
Leverage key strength of the state
in terms of natural resources, flora
and fauna, rich and cultural heritage
etc. to promote different forms of
tourism.
22. http://www.up-tourism.com/tourism_circuits.htm
http://tourism.gov.in/writereaddata/CMSPagePicture/file/
marketresearch/Identified%20circuit%20for%20various%20
states%20phase%202/new/UttarII.pdf
23. http://tourism.gov.in/writereaddata/CMSPagePicture/file/
marketresearch/Tentavely%20Identified%20circuit%20
for%20various%20states/new/Haryana.pdf
24. http://www.rajasthantrip.com/rajasthan-travel-circuits.html
http://tourism.gov.in/writereaddata/CMSPagePicture/file/
marketresearch/Tentavely%20Identified%20circuit%20
for%20various%20states/Rajasthan.pdf

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23

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Seamless travel

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

3.1 Benefits of seamless travel


Last mile connectivity catering
to smooth and seamless travel is
increasingly being recognised as an
important prerequisite for boosting
tourism globally. It holds special
relevance for India which has been
witnessing steady growth in the sector
over the past few years.
The current public transport system
suffers from lack of intermodal linkage
between operations of various traffic
modes causing a stressful experience
to travellers. Disparate fares, complex
tax levies, longer travel times,
unintegrated information services and
lack of an integrated management
of transportation systems and
operations, lack of wayside amenities
such as petrol pumps, clean drinking
water kiosks & sanitation facilities,

road signages etc. are some of the


challenges that tourists face due to
lack of a seamless transportation
system.
Seamless travel requires smooth
and intelligent connections between
different modes of transportation
offering multiple advantages:
Physical continuity: Availability
of an integrated transport system
encompassing various modes of
transportation in the country
Reduced time requirements:
Significant time savings in transfer,
access and waiting times through
rationalization of operation
schedules
Cost savings: Establishment of a
competitive transport fare inclusive

of applied discounts, seasonal


passes, discounted fare policies etc.
help save money for the tourists
Information availability: User
convenience is enhanced with
provision of real time information
on transport modes, facilities and
transfer stations.
A seamless transportation system aids
in enhancing the overall administrative
systems and procedures. It benefits
the economy in the form of reduced
demand for high cost investments
in individual facilities and leads to
preference for public transportation
networks over private passenger
cars thus being in line with the global
agenda of green and sustainable
growth.

3.2 Case study: Seamless travel in European Union countries


Europe with its enticing beauty
is a preferred tourism destination
for tourists globally. As per the
World Economic Forums Travel and
Tourism Competitiveness Report
2013, it maintained its position as the
leading region for travel and tourism
competitiveness. The 28 EU member
states rank high on all parameters
especially on the Infrastructure
availability.
Several agreements between the EU
nations provide easy and seamless
travel to visitors:
Schengen agreement: The
Schengen Borders Agreement
permits people to travel freely within
the Schengen area (26 European
countries)1 if the traveler otherwise
qualifies to enter the Schengen
area, by crossing an official external
border during regular hours of
operation and obtaining an entry
stamp in the passport. With this
there are no national border controls
and visitors travel from country to
country without systematic passport
checks.

Single currency: Euro is the


common currency used by 17 out of
28 EU countries covering 332 million
people1. It offers several advantages
such as eliminating exchange rate
fluctuation and hence exchange
costs. Easy cross border trade as
a result of a single currency aids in
economic growth and multiple user
choices.
No visa requirements: Qualified
tourism visitors or people with
a valid US passport who are on
vacation in the EU for less than
90 days are exempted from visa
requirements.
The EU offers seamless travel
between member states across all
modes of transportation. Extensive
international passenger services are
provided through railway length of
more than 212,000 kms2. Several
countries in the EU enjoy more than
6000 kms of high speed railway lines
with speeds up to 350 km/h2. A single
pass system called as international
Eurail pass is available at prices of
USD 5002 for passengers/tourists
for a seamless travel between any
locations within member states. The

aviation sector in the European Union


enjoys a single European market
for air transport called as the Single
European Sky by which the design,
management and regulation of
airspace is coordinated throughout the
European Union rather than separate
member states ensuring safe and
efficient utilisation of airspace and the
air traffic management system. This
helps users enjoy more affordable
airfares and a vast array of choices for
both traditional and low cost carriers.
For example, a flight from Brussels
to more than 70 destinations across
Europe often costs less than USD 27
each way2.
Lessons from the seamless travel
capabilities of the European Union
may be applied in the Indian context in
order to make travel for tourists more
easy and enjoyable.

1. http://travel.state.gov/travel/cis_pa_tw/cis/cis_4361.html
2. euinsight, November 2011

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24

25

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

3.3 Passenger/road tax structure in India


There are two mechanisms for the levy
of passenger/road tax in India. While
the states of Manipur and Himachal
Pradesh follow the basis allocation of
fare mechanism, where tax is levied as
a percentage of the actual fare charged

from the passengers; Haryana follows


the composite tax mechanism for
small passenger vehicles, where tax is
levied based on the criteria of seating
capacity, occupancy ratio etc.

Table 3.1: Passenger tax structure in select states of India


State

Tax structure

Haryana

Under the Punjab Passengers and Goods Taxation Act, 1952, as applicable to the State of Haryana,
Tax at 25% of value of fare is charged on passengers carried by a motor vehicle
Lump sum rates of tax varying from INR 6000 to INR 16000 per month have been fixed for permit holders on link routes
Lump sum amount varying from INR 1200 to INR 14400 per annum is payable by smaller passengers vehicles

Gujarat

1% of the amount of fare collected for municipal areas


17.5% for the area outside the municipal areas

Himachal Pradesh

40% of the fare and 20% surcharge on the passenger tax

Rajasthan

In case of passenger vehicles registered in the state, special road tax is broadly based on the cost of vehicle/chassis and its seating
capacity. In case of vehicles registered outside the state, special Road tax is based on the basis of seating capacity for the passenger
vehicles

Source: Report on Road User Taxes in India issued by Foundation for Public Economics and Policy Research, 2010

Imposition of tax on commercial


vehicles such as tourist taxis, maxi
cabs, all India tourist buses etc. proves
to be an additional burden on the
tourists travelling pan India and has
several negative effects. Existence
of large number of check points for
collection of passenger tax/road tax
causes monetary loss to transporters
due to wastage of time. Large number
of check points causes considerable
waste of time arising from traffic
stoppages. Manual processing of
tax papers at interstate check posts,
leads to delays and hampers smooth
traffic flow. Single window integrated
check posts may help address such
issues. In addition to levy of passenger
tax, tourist tax is collected at some
major tourist destinations. Inefficient
system of collection, high rates and
non-uniformity of Passenger Tax/ Road
is a source of irritation and harassment
to tourists.
Requisite steps are required to
develop alternate mechanisms to not
only to augment state revenue but
also to reduce the hassles faced by the
tourists/commercial vehicles:
Need for development of an
Integrated Tourism Circuit for various
3. http://www.domain-b.com/industry/Tourism/20100722_tourism_
takes.html

states with an integrated taxation


regime
Replace various road transport
related taxes/levies (road tax, goods
tax, passenger tax, etc.) by a single
composite tax
Transport check gates may be
replaced with integrated check gates
combining check posts of sales tax,
forest etc. into one
Some of the recommendations such
as the integrated taxation regime have
already been initiated in India.
Seamless travel initiatives in the
golden triangle circuit in India3
The ministry of tourism, India
recognises the importance of
seamless travel for boosting tourism
in the country and hence several
efforts have been initiated towards
achievement of the same. Ministry
of Tourism in collaboration with the
Ministry of Road Transport & Highways
and the State Governments of NCT
of Delhi, Rajasthan, Haryana & Uttar
Pradesh in 2010 announced that taxes
would be collected centrally at each
of the four starting nodes at Delhi,
Gurgaon, Jaipur and Agra for allowing
unhindered movement in the Golden

Triangle of Agra-Delhi-Jaipur. Taxes


collected would be apportioned.
For Delhi, the Delhi transport authority
would collect taxes from government
approved tour operators or tourist
transport operators on behalf of
concerned states. This would be based
on type of vehicle, travel itinerary and
prevalent tax structure. These taxes
would be collected as separate drafts
and the Delhi Transport Authority
would issue a composite permit for
unhindered movement through the
circuit. Speedy implementation of
such programs along with increasing
awareness of the same is required.
Success of the seamless interstate
taxation regime in golden triangle
has encouraged the states of
Karnataka, Kerala, Tamil Nadu and
Andhra Pradesh in southern India
which are considering formation of an
integrated circuit comprising these
states4. Other integrated circuits such
as Deccan-Odyssey and LonavalaMatheran-Nasik-Shirdi-AurangabadPune-Mahabaleshwar have also been
planned.

4. http://www.ttgasia.com/article.php?article_id=21691

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Other initiatives for providing seamless


travel across the country include:
The Urban Development Ministry
announced the National Common
Mobility Card (NCMC) in 20115 by
the name c to enable citizens to
use transport networks across the
country with a single CMC card
being used across cities and for
different modes of transport and
for parking and toll purposes. The
implementation would be partly
funded by the Central Government
under the JnNURM scheme
covering buses sanctioned under
the scheme. Jaipur City Transport
Services Ltd., Karnataka State Road
Transport Corporation, Bangalore
Municipal Corporation and Bhopal
Municipal Corporation are some of
the first participants. There is a need
for expediting the implementation of
such programs enabling seamless
travel in the country
Bangalore witnessed steps towards
integration of the various transport

modes in 2011. The Metro Bus


Transit (MBT) pass6 was launched
by the Metro and the Bangalore
Metropolitan Transport Corporation
enabling passengers to travel via
buses and metros as many times a
day with a single card.
AAI selected IT Solutions provider
SITA in 20137 to equip 25 airports
in India (including non-metros) with
common use passenger processing
systems to enhance passenger
experience by maximising the use
of check-in counters and gates
especially during the peak rush
hours. In addition, tender has been
floated for setting up of Airport
Operations Control Centre at 10
airports providing solutions like
resource management and data
base, flight information systems,
passenger flow monitoring etc.
Incredible India-Yes Bank Travel Card
was introduced for inbound travelers
at ITB Berlin in 20138. The card
allows visitors to pay seamlessly in

Indian rupee at shops or restaurants


with point of sale terminals or to
withdraw cash at ATMs and can be
bought and topped up at licensed
travel agencies, Yes Bank branches,
airport counters, money changers,
hotels, airport kiosks, etc.
Several other such steps have been
initiated in several parts of the country
in order to provide seamless travel
opportunities to visitors. However, an
overall integration of various modes of
transport and across various regions
and states in the country covering
key tourist destinations is required in
order to reap benefits of a seamless
transportation system.

5. http://pib.nic.in/newsite/erelease.aspx?relid=78167
6. http://www.thehindu.com/news/cities/bangalore/bmrcl-bmtcsign-mou-for-common-day-metrobus-transit-passes-in-bangalore/
article1458642.ece
7. http://www.sita.aero/content/aai-partners-with-sita-to-improvepassenger-experience-at-25-indian-airports
8. http://travel.financialexpress.com/latest-updates/1241-yes-banklaunches-incredible-india-travel-card

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Key issues in
tourism sector in
India

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

4.1 Training and skill development


Travel and tourism sector in India
includes employees such as inbound
tour operators, travel agents, tourist
transport operators, adventure
tour operators and domestic tour
operators in the travel trade segment
and those employed in hotels and
restaurants in various functions of
front office, F&B and housekeeping
among others. While the tourism
sector in India is targeted to grow at
an annual rate of 12 per cent during
2011-20161, adequate training and skill
development infrastructure and hence
availability of trained manpower has
not kept pace with growth. This has
led to an existing as well as forecasted
shortfall of trained manpower in
various segments of tourism sector
in India. The hospitality sector alone
witnessed a shortfall of 0.5 million
employees during 2011-2012 which is

expected to rise to 0.8 million by 2017


and 1.1 million by 20221 as per the
target growth levels.

As per a study by the Ministry of


Tourism, only 50 per cent of the
employees in the key functional
domains of hotels are fully trained
with this statistics reducing to 35
per cent for restaurants and other
eating outlets2. This necessitates the
immediate need for formal training
especially for the hospitality sector
employees. In addition, proper
selection of hotel management
students, increased focus on grooming
and communication skills, on the job
training, courses in foreign languages
and standardisation and monitoring of
curricula in private institutions may be
required.

There exists a forecasted requirement


of around 2.8 million employees for
restaurants, 4.1 million employees
for hotels and 0.3 million employees
for the travel trade segment by
2022 resulting in an incremental
requirement of a total of 2.7 million
employees for the tourism sector
as compared to 2012 employment
figures2.
An assessment of the training
infrastructure estimates a total of 337
training institutes in the Hospitality
sector and 101 travel and tour
institutes offering courses related to
ticketing and tourism as in March 2010
which appears to be significantly low2.

Several skill development areas


have been identified for employees
engaged in the tourism sector in India.

Table 4.1 Skill development areas for employees engaged in travel and tourism sector in India
Function

Technical skills

Soft skills

Hotels and restaurants


Front office

Managing guests
Call handling incoming and outgoing
Billing
Maintaining registers
Paying attention to details

F&B services

Managing guests
Adequate knowledge of menu and cuisines
Cleanliness and hygiene
Simple billing
Complaint handling

Communication skills
Dedication towards work
Behavioural skills

F&B kitchen

Latest cuisines
Innovation/creative skill towards developing new
offerings
Handling kitchen equipments
Yield management
Staff management
Cost management
Hygiene and cleanliness

Communication skills
Dedication towards work
Behavioural skills
Time management skills

Housekeeping

Inspection of rooms, consumables, etc.


Complaint handling
Responding to guest requirements
Up keeping of public places, restaurants,
conference halls etc.
Cleanliness and hygiene
Ability to use all the housekeeping equipments

Communication skills
Team work skills
Attitude towards work

1. India Tourism Statistics 2011, Ministry of Tourism

Communication skills
Team work skills
Attitude to listen
Behavioural and interpersonal skills

2. Human Resource and Skill Development requirements in the


Tourism, Travel, Hospitality & Trade sector, 2022 report by National
Skills Development Council

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Table 4.1 Skill Development areas for employees engaged in travel and tourism sector in India
Function

Technical skills

Soft skills

Hotels and restaurants


Ticketing

Passenger routing skills


Ability to act as a travel advisors
Maintaining a cordial relationship with the clients/
travelers
Geographical knowledge
Knowledge on various hotels and site seeing
locations
Networking skills
Ability to use ticketing software
Procedural knowledge on visa/ passports

Time management
Telephone etiquette
Communication skills

Tour guides

Knowledge/awareness on the area, people, culture


etc.
Historical knowledge/significance of tourist
locations
Skill to handle tourists
Skill to understand the tourist requirements
Decision making skills
Organizing ability

Time management
Communication skills

Source: Human Resource and Skill Development requirements in the Tourism, Travel, Hospitality & Trade sector, 2022 report by National Skills Development
Council

In order to meet the high anticipated


demand for employees over the next
decade, concerted efforts are required
for augmenting the existing training
infrastructure through provision
of additional training institutes
and enhancing the capacity and
infrastructure of the existing ones. In
addition short term courses may be
introduced in order to enhance the skill
sets of existing employees.

3. Human Resource and Skill Development requirements in


the Tourism, Travel, Hospitality & Trade sector, 2022 report by
National Skills Development Councilf

Formally trained managerial staff


accounts for only 16 per cent of the
total hospitality sector and 21 per

cent of the total travel and trade


sector workforce3. Efforts are thus
required for enhancing the skill sets
of non managerial staff in the sector.
With 20 per cent3 of the travel and
trade sector employees comprised
of casual workers, development of
basic skill set is important. These
include health and personal hygiene,
cleanliness, basic service techniques,
cooking techniques, garbage disposal,
etiquette and basic manners, basic
nutrition values, basic tourism
awareness, first aid, client handling
and behavioural skills etc.

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

4.2 Safety and security of tourists


Safety and security of tourists is
of paramount importance in any
country as it majorly impacts the
inflow of foreign tourists in the
country. Domestic tourist movements
are impacted in states and tourist
locations where tourists consider a
threat to their safety and security. It
holds special significance for India
which has been ranked at a low level
of 74 amongst 140 global economies
on safety and security parameters as
per the World Economic Forums T&T
Competitiveness Report 2013.
Government has made concerted
efforts towards increasing the safety
and security of tourists in India. One
of the main efforts in this direction
includes setting up of a special tourist
police. Following Kochi in Kerala where
the first tourist police station in the
country was set up in 20104, several
other states such as Andhra Pradesh,
Delhi, Goa, Himachal Pradesh, Jammu
and Kashmir, Karnataka, Kerala,
Maharashtra, Madhya Pradesh,
Odisha, Punjab, Rajasthan, and
Uttar Pradesh have deployed Tourist
Police in one form or the other5. The
indicative tasks of the tourist police
include ensuring safety and security of
tourists by providing them information
on safe lodging and transportation,
effective and fast handling of enquiries
and complaints, regular surveillance

and immediate action in case of any


identified misconduct.
The tourism ministry is also making
efforts towards sensitising various
stakeholders through electronic and
print campaigns for ensuring the safety
and security of tourists. Provision
of funds under the Central Financial
Assistance to states of Rajasthan,
Uttar Pradesh and Andhra Pradesh
for setting up of Tourist Facilitation
and Security Organization on a pilot
basis and issuance of guidelines
for adoption of code of conduct for
safe and honorable tourism issued
to hotels, guides, tour operators and
other professionals and institutions are
other important steps.
With rise in number of women
travelers both in terms of domestic
as well as foreign tourists, ensuring
their safety has emerged as a major
concern. The Ministry of Tourism has
launched a sensitization campaign, I
respect women, with an aim to
raise awareness about the need for
sensitive behavior towards women
and to provide greater security6.
Guidelines issued at the 2012 APEC
Tourism Ministerial Meeting7 towards
ensuring tourist safety may also be
implemented:
Encouragement of risk assessment
and management by the private

sector before commencement of


travel
National tourist administrations
of APEC economies to compile
and exchange best practices of
establishing appropriate regulations
Maintain a transparent and balanced
mechanism for generating travel
advisories
Develop online travel registration
tools for collecting data on outbound
tourists
Put in place administrative
arrangements to get quick access to
tourists data without compromising
the data privacy for identifying
tourists in times of emergency
Regulation and monitoring of various
service providers in tourism value
chain to ensure compliance and
safety
While steps have already been
initiated in this direction, there
is a need for ensuring effective
implementation of the policies and
actions drafted to ensuring safety and
security of tourists.

4. http://www.thefreelibrary.com/Indias/first/tourist/police/station/
opens/in/Kochi.-a0220034757
5. http://in.news.yahoo.com/government-favours-special-forcesafety-tourists-112538680.html
6. http://www.travelbizmonitor.com/mot-unveils-i-respect-womencampaign-21069
7. http://www.apec.org/Meeting-Papers/Ministerial-Statements/
Tourism/2012_tourism/annex_c.aspx

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

4.3 Healthcare for tourists


There is a significant need for
improvement in ensuring sound
health of tourists in India especially
considering the low rank of 109 for
India in terms of health and hygiene
standards as compared for 140 world
economies8. Indicative parameters
reveal dismal results. Physician density
at 0.7 per 1000 population and 9
hospital beds for every 10,000 people
in India are extremely low for a country
that considers tourism as a sector of
high importance for the economy8.
Only 34 per cent of the population in
the country has access to improved
sanitation services and 8 per cent
of the population still does not have
access to clean drinking water8.
Urban areas in India have excellent
or good medical facilities such as
long distance road ambulance, air
ambulance, state of the art hospitals
meeting international standards,
pharmacies etc. However, rural areas
in India are devoid of such facilities
which may hamper the growth of
rural tourism in India. There is also a
wide state wise disparity in terms
of medical infrastructure availability.
Several issues surround tourist
destinations in the country. Lack of
clean drinking water kiosks, lack of

clean toilet facilities, lack of first aid


and medical facilities in immediate
vicinity especially in hilly and remote
areas and lack of good quality
transportation ambulances to medical
centres in case of emergency are
some of the major concern areas.
The ministry of tourism has taken
steps for improving sanitation facilities
by asking the tourism departments
of all states and union territories to
establish adequate wayside amenities.
Helicopter services have been
proposed for emergency medical
situations. Steps are also being taken
to provide good quality medical
facilities at tourist destinations.
However, an overall development of
medical infrastructure in the country
is required for provision of a safe
and healthy experience to tourists
visiting India. The central government
has given priority to healthcare and
is making significant investments
to improve the infrastructure and
delivery mechanism jointly with the
state governments through National
Rural Health Mission. It has decided to
increase healthcare expenditure to 2.5
per cent of GDP by the end of the 12th
Five Year Plan by 20179.

In addition, several precautionary


measures may be taken in order to
avoid instances of tourist illness in the
country by:
Providing information on important
vaccinations
Increasing awareness on
importance of consuming food and
water from organised vendors with
clean and hygienic premises
Timely and transparent
communication of travel advisories
in situations of disease outbreaks
Careful screening of tourists at
airports for any kind of existing
disease/infection

8. World Economic Forums travel and tourism Competitiveness


Report 2013
9. http://www.indianexpress.com/news/healthcare-spend-to-rise-to2.5--of-gdp/918380/

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

4.4 Infrastructure
As per the World Economic Forums
T&T Competitiveness Report 2013
for 140 world economies, Indias
air transport infrastructure, ground
transport infrastructure and tourism
infrastructure have been ranked 39,
42 and 95 respectively indicating
considerable scope for improvement.
Other infrastructure requirements
such as availability of good quality and
reasonably priced hotel rooms, parking
spaces, tourist cars etc. are also a
cause of concern. Some of these have
been discussed below.
Air Transport Infrastructure: While the
overall airport infrastructure in India is
ranked well, quality of infrastructure,
airport density per million population
and number of departures along with
rising airfares are a cause of concern.
State wise comparison reflects
wide disparity with Maharashtra
and Delhi leading at more than 0.25
million aircraft movements in 2010
as compared to Punjab, Manipur and
Jharkhand with less than 0.01 million
aircraft movements10.
Road Transport Infrastructure: While
India is ranked high (30)11 in terms of
road density per million population,
quality of roads is unsatisfactory
especially in rural areas. In addition
there is a lack of feeder stations even

on proper roads with not enough stops


for pick up. The national and state
highways account for 2 per cent and 4
per cent respectively of the total roads
in India12. Hence, just 6 per cent of the
overall roads in India accounting for 80
per cent12 of the total traffic signify the
need for improvement in the national
road and highway network. Lack of
parking facilities, police stations and
tourist information centres in vicinity
of tourist destinations is another cause
of concern. Lack of public amenities
such as clean toilets and clean
drinking water kiosks poses health
concerns for tourists. Lack of proper
road signage (visibility, language etc.)
causes trouble in identifying locations
especially to the tourists travelling by
road.
Rail Transport Infrastructure: India
enjoys good quality rail infrastructure,
however there is scope for state wise
improvement. While Northern states
such as Delhi and Punjab enjoy railway
route length of 12.3 km and 4.2 km per
100 sq km of area10, states in eastern
part of India have negligible railway
route lengths. In addition there exists
a significant demand supply gap for
railway tickets on major routes
Hotel room availability: India ranks very
low in terms of number of branded

hotel rooms per 100 population


(rank 136)11. With just a little more
than 68,800 branded rooms10 for the
country
India has only two branded rooms per
100 sq km area10 which is concentrated
in top cities and urban areas. In
addition there is a lack of budget
hotels offering good quality services at
reasonable prices
Government recognizes the need for
upgradation of tourism infrastructure
in India and has proposed an outlay
of INR 152.2 billion13 for the tourism
sector under the 12th five year
plan. This includes creation of basic
infrastructure such as improving
road connectivity and wayside
amenities, development of helipads,
heliports and air strips, upgradation of
passenger terminals and creation of
tourist infrastructure in collaboration
with the private sector. Efficient
implementation of such plans is
pertinent for achieving an overall
infrastructural development in the
country.

10. HVS State Ranking Survey 2011


11. World Economic Forums travel and tourism Competitiveness
Report 2013
12. Ministry of Road Transport & Highways
13. Report of the Working Group on Tourism, 12th Five Year Plan,
Ministry of Tourism, Government of India

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Recommendations

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Key Recommendations for boosting


tourism sector in India have been
summarised below:
Projection of Indias image
as a safe and secure tourist
destination
Tourist Police Task Force has
been established by various state
governments for ensuring safety
and security for tourists. Special
sensitisation campaigns may be
implemented for women tourists
and to publicise these campaigns on
global platforms. Health concerns
for tourists visiting India also needs
to be mitigated.
Attract private investment
Private sector players may
be encouraged to participate
in development of tourism
infrastructure by provision of fiscal
as well as non fiscal incentives. PPP
projects and formation of Special
Purpose Vehicles for mega tourism
projects may be required
Infrastructural development
Investments in tourism
infrastructure may include
development of both tourism as
well as civic infrastructure. This
may also involve provision of way
side amenities, tourist information
bureaus and websites for providing
requisite tourist information. Efforts
towards enhancement of overall
transport infrastructure in the form
of good quality roads, rail network,
airports, helipads, availability of
tourist vehicles etc. may also be
strengthened in order to improve the
overall infrastructure
Development of tourism
destinations
An extensive market research
and evaluation exercise may be
undertaken in order to identify
desired tourist destination attributes
and major markets and segments.
Identified tourist destinations
may then be developed through
flagship projects involving state
governments and private sector
players. These may be developed
either as products such as religious,
wellness, adventure, nature,
rural or agriculture tourisms or

as experiences such as the Rama


trail planned in Gujarat or the Spice
Route Tourism planned in Kerala.
Development of tourist circuits
across states
Key tourism circuits across the
country may be identified basis
discussions with key stakeholders
such as state governments, local
travel trade partners etc. Key
attributes, tourism potential, current
and future connectivity and synergy
within destinations may be studied
Seamless travel within circuits
Steps may be taken in order to
enhance travel experience for
visitors across states. Payment of
road tax, toll etc. while entering
each state may be replaced by an
integrated taxation regime. This
may further be augmented by
development of an integrated public
transport system at a national level
on lines of the Eurail network in
Europe
Joint marketing programs
With tourist circuits spanning
across various states, collaborative
marketing efforts may be required
for promotion of the same:
Focused branding and
promotional campaigns may be
designed
Marketing material like
brochures, print creative, audio
video presentations, short films,
radio jingles, creation of web-sites,
online creatives, advertisements
over media channels like print,
radio or internet etc. may be
utilised
Involvement of local travel
trade partners may be encouraged.
Trips to involved destinations,
informative sessions, financial
support and incentives may be
provided
Direct

and intensive reach
marketing programs may
be executed through social
networking sites such as twitter,
facebook etc. in order to reach
out to the young tech savvy global
population

Focused websites, exhaustive


in content, user friendly and
attractive in visual appeal may be
developed in multiple languages
of target countries
Participation in international
events may be increased and
a greater number of domestic
tourism events and road shows
may be organized in order to
offset seasonality of tourist
inflow. Events may be based
on innovative themes of music,
dance, sports, food, fruits,
handicrafts, Indian culture and
traditions, Indian villages, festivals
etc.
Customised tour packages
may be developed keeping in mind
the profile of visitors, budget and
travel requirements. Comparative
pricing of tourism products may
also need to be considered after
analysis of other tourism packages
and products available
Differentiated tourism offerings
for repeat travelers
Customized packages with different
tourism products and discounts
may be provided to repeat travelers
in order to provide a different and
enriching experience on each visit
Partnership oriented marketing
Travel trade partnerships may be
extended beyond tour operators,
guides etc. to partners from other
industries such as international
hotel chains, airlines or credit card
companies
Human resource development
Provision of additional training
institutes, enhancing capacity of
existing ones along with introduction
of short term courses providing
specific skills directed at hospitality
and travel trade sector employees
may be required for catering to
the increased manpower and skill
requirements. Development of
basis skill sets for casual workers
especially those in the travel trade
segment are required. Rural youth
may be provided vocational training
through special institutes to provide
them employment opportunities.

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Inclusive growth
There is a need to spread education
and awareness on the importance
of tourism sector and increase
stakeholder participation involving
the government, private sector and
the community at large. Marketing
campaigns like Atithidevo Bhava

may be implemented at regular


intervals. Tourism awareness
programs and workshops may be
organized to enhance sensitisation
towards tourists and tourism
destinations and for sustainable
development and maintenance of
tourism sites in the country

Several of the stated


recommendations have also been
implemented by tourism countries
such as Thailand, Singapore and
Malaysia. Please refer to Box 5 for
details on initiatives carried out by
these countries.

Box 5: Case study tourism development initiatives in South East Asian countries
Several tourism development initiatives have been planned and implemented by countries like Thailand1, Singapore2 and
Malaysia3 around key areas of infrastructure development, development of tourist destinations, marketing campaigns and
events, training and development and stakeholder participation.
Development of good
quality transport and
social infrastructure

Singapore: Ground and air transport ranked seocnd and 14th respectively due to availability of high-quality roads, railroads, and ports
Seamless travel in ground transport networks
Strong Information, Communication and Technology (ICT) infrastructure
Good educational systems and training facilities along with flexible labor market places, safe and secure destinations

Development of tourist
amenities and services
as per international
standards

Malaysia: Several infrastructure developments being implemented under the National Economic Transformation Programme, 2010.
Enhancing connectivity to priority medium-haul markets and improving rates, mix and quality of hotels
New luxury hotels expected to commence operations
KLIA2 a new low cost carrier terminal & Malindo airways, a new low cost airline to commence operations in 2013

Allocation of funds for


tourism development

Singapore: Several tourism development funds have been allocated


Tourism Product Development Fund amounting to 2 billion Singapore dollars for creation of new tourism products as well as
rejuvenation of existing ones during 2005-2015
Kickstart fund to encourage innovative content in lifestyle
Cruise Development Fund to help cruise companies cultivate products and demand
Tourism Technology Fund for encouraging development of new products by leveraging modern technology

Infrastructural
Developments including
new leisure zones &
attractions

Malaysia: Several tourism infrastructure developments being implemented under the National Economic Transformation programme,
2010:
22 parks and gardens under parks and gardens tourism
Development of an eco-nature integrated resort in Sabah
2012: First Legoland theme park to be built in Asia, Legoland Malaysia and Puteri Harbour Indoor theme park
Establishment of dedicated entertainment zones

Rehabilitation and
sustainable development
of tourism sites

Singapore: Upgradation of existing facilities planned like Sentosa park in Singapore to introduce Port of Lost Wonder, Singapores first
kids club by the beach and iFly Singapore, worlds largest indoor skydiving venue

Events & festivals


leveraging cultural
heritage in terms of
religion, art and crafts and
languages

Malaysia: Events and programmes organized basis varied themes of:


Duty free shopping destination: Events such as Grand prix sale, Mega sale carnival, Yearend sale and International shoe festival
planned during 2013-14
Sports: Sports events planned such as F1 Petronas Malaysia Grand Prix and Malaysian Open ATP World Tour 250 etc.
Business: Malaysia helicopter tour package launched in 2011
Singapore: Themes of art and culture, food, sports, business etc.
Singapore Arts Festival, Singapore Sun Festival and Singapore Food festival encourage inbound travel
Singapore Sports Hub has been host to the Singtel Formula one Singapore Grand Prix and inaugural Youth Olympic Games

Source:
1. aimp.apec.org/Documents/2012/TWG/TWG1/12_twg1_003.pdf
2. Singapores Tourism Sector Performance for 2012, Singapore Tourism Board
3. http://icis.apceo.com/Files/speech%20in%20Gansu/speech%20afternoon/2.Hooi%20Lai%20Wan.pdf
http://malaysiatravelnews.com/malaysia-is-10-in-worlds-top-tourist-destination-from-unwto/
Malaysias Tourism Success Story, Asean Tourism Forum 2013
www.lpptourism.org/download/AW_TourismPromotion.pdf
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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

Promotional and Branding


Campaigns

Malaysia: Several tourism promotion events and campaigns planned

Partnership Oriented
Marketing

Singapore: Emphasis on long term engagement with industry partners such as with Wholesaler Overseas Travel Agency for
development of tailored packages or Mastercards Priceless Singapore partnership that endorses Singapore by establishing it in same
league as New York, London, Sydney and Beijing

Differentiated offerings for


various tourism segments

Thailand: The Strategic Marketing Action Plan 2012 encourages travel trade partners to formulate special packages for expansion of
high-income market, niche customer-segments such as golfers, wedding, single women travelers, encouraging repeat travelers etc.

Visit Malaysia Year campaign planned for 2017


Promotional events such as MAS travel fair, MATTA fair and Cuti-Cuti Malaysia, Malaysia Mega Sale Carnival, Colours of Malaysia
showcasing rich cultural traditions and promoting culture of planned holidays
Singapore: Differentiated campaigns for target countries such as The Holiday You Take Home With You for India, New Discoveries
for China and Get Lost campaign for Australia

Singapore: Differentiated approach to be adopted for proximate markets like Indonesia offering opportunities for frequent visits or for
markets like Japan and Vietnam which are expected to show good results with increased investments
Training and awareness
programs for travel trade
partners

Singapore: Training Industry Professional in Tourism Scheme to support companies in employee upgrading and talent development.
NATAS accreditation aimed at encouraging tourism professionals to upgrade skill sets through certified courses

Rehabilitation and
sustainable development
of tourism sites

Singapore: Upgradation of existing facilities planned like Sentosa park in Singapore to introduce Port of Lost Wonder, Singapores first
kids club by the beach and iFly Singapore, worlds largest indoor skydiving venue

Encourage participation
from government sectors,
civil societies and local
administration

Malaysia: Rigorous governance structure adopted for successful implementation of the National Economic Transformation
programme, 2010 with delivery task force being led by the prime minister and the minister for tourism in the country

Policy and regulatory


support

Thailand: The National Tourism Development Plan, 2012-2017 includes as focus areas steps to improve efficiency in issuing visas,
waive visa fee for visitors from FTA partner countries or those in trade and investment relations and waive visa requirements for
tourists from target countries
Singapore: Availability of favourable policies facilitating foreign ownership and FDI, well-protected property rights and few visa
restrictions. Review of Travel Agents Act & Regulations and Tourist Guide Regulations has been planned to help industry cater to
requirements of customised itineraries

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Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

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managing tax risks, while helping to control costs.
KPMG Advisory professionals provide advice and assistance to enable
companies, intermediaries and public sector bodies to mitigate risk,
improve performance, and create value. KPMG firms provide a wide
range of Risk Consulting, Management Consulting and Transactions &
Restructuring services that can help clients respond to immediate needs
as well as put in place the strategies for the longer term.

2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

Travel and tourism sector: Potential, opportunities and


enabling framework for sustainable growth

About

38

CII

The Confederation of Indian Industry (CII) works to create and sustain an


environment conducive to the development of India, partnering industry,
Government, and civil society, through advisory and consultative processes.
CII is a non-government, not-for-profit, industry-led and industry-managed
organisation, playing a proactive role in Indias development process. Founded
over 118 years ago, Indias premier business association has over 7100 members,
from the private as well as public sectors, including SMEs and MNCs, and an
indirect membership of over 90,000 enterprises from around 257 national and
regional sectoral industry bodies.
CII charts change by working closely with Government on policy issues,
interfacing with thought leaders, and enhancing efficiency, competitiveness and
business opportunities for industry through a range of specialized services and
strategic global linkages. It also provides a platform for consensus-building and
networking on key issues.
Extending its agenda beyond business, CII assists industry to identify and
execute corporate citizenship programmes. Partnerships with civil society
organisations carry forward corporate initiatives for integrated and inclusive
development across diverse domains including affirmative action, healthcare,
education, livelihood, diversity management, skill development, empowerment
of women, and water, to name a few.
The CII Theme for 2013-14 is Accelerating Economic Growth through Innovation,
Transformation, Inclusion and Governance. Towards this, CII advocacy will accord
top priority to stepping up the growth trajectory of the nation, while retaining a
strong focus on accountability, transparency and measurement in the corporate
and social eco-system, building a knowledge economy, and broad-basing
development to help deliver the fruits of progress to all.
With 63 offices, including 10 Centres of Excellence, in India, and 7 overseas
offices in Australia, China, Egypt, France, Singapore, UK, and USA, as well as
institutional partnerships with 224 counterpart organizations in 90 countries, CII
serves as a reference point for Indian industry and the international business
community.

2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

KPMG India Contacts

CII Contacts

Pradeep Udhas
Partner and Head
Markets
T: +91 22 3090 2040
E: pudhas@kpmg.com

Jasdeep Singh
Head
Trade Fairs - Northern Region, Chandigarh
T: +91 0172- 2607228, 2605868, 5022522
E: Tradefairs.nr@cii.in

Jaideep Ghosh
Partner
Management Consulting
T: +91 124 307 4152
E: jaideepghosh@kpmg.com

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or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is
accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information
without appropriate professional advice after a thorough examination of the particular situation.
2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.
The KPMG name, logo and cutting through complexity are registered trademarks or trademarks of KPMG International.
Printed in India.