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IIM KOZHIKODE

Employment Generation in West Bengal


through Development of Local Tourism
A Business Research Management Proposal
By

Soumyarup Dasgupta
PGP/16/172

Abstract
Purpose
The purpose of this paper is to identify why tourism in the state of West Bengal is lagging behind
the national average and estimate how improvements made in this sector will be able to generate
more employment in the state.
Design/ Methodology/ Approach
The problem was structured using the Stakeholder framework to understand the interplay of
various forces affecting the tourism industry. Other tools such as Behaviour over Time (BOT)
Graphs and Causal Loops were also used to illustrate the linkages between those factors affecting
growth of tourism and consequently employment in the state.
Primary and secondary research was carried out to identify causes behind the current lag, what
gaps need to be plugged and what employment potential can be generated by doing so. The main
tourist spots that need to be targeted were also identified and one of them used as representative
to assess the probable impact of tourism growth on employment.
Findings
The findings reveal that infrastructure bottlenecks are the main impediments towards growth of
tourism in West Bengal, especially lack of proper roads and good hotels. Low awareness among
tourists as well as the volatile law and order situation in the state also contribute to WBs small
share in Indian tourism.

However the findings also reveal that with proper channeling of funds at the disposal of the WB
government, it is possible to take advantage of the unique geographical, historical and cultural
landmarks in the state and increase employment opportunities in this sector by at least 50% by
2016.
Practical Implications
This research paper provides detailed reports on what tourist places in West Bengal need to be
targeted, what needs to be done to increase tourist footfall in such places and finally what can be
the expected number of jobs created as a result of such endeavours. Thus it would help the State
Government a lot in allocating funds for tourism and carrying out regular assessments to check
whether the project is on track. It would also allow them to identify key areas which can create
more jobs in the future.

Introduction
Tourism in India generated $121 billion or 6.4% of the nation's GDP in 2011, creating 39.3
million jobs or 7.9% of its total employment. India has both natural beauty as well as sites of
historical importance. This has made it an important tourism destination which is evident from
the fact that this sector is predicted to grow at an average rate of 7.7% during the next decade.
However India ranks a lowly 68th out of 139 countries when it comes to the competitiveness of
its tourism sector according to a TTCI report of 2012.
Indian budget allocates even less than 1% to the tourism sector which is in stark contrast to
certain other countries like Thailand where the figure is almost 4%. In fact last year Indian
Government even trimmed the tourism ministry budget by over 20%.
Thus inspite of having tremendous potential, Indian tourism industry continues to lag behind
other similar countries. Without much Government support and the overall economic gloom
across the world, the tourism industry will find it hard to sustain the growth it had been
witnessing during the early 2000s.
One of Indias most gifted states is West Bengal (WB), situated in the eastern part of the country.
With the Himalayan ranges in the north, Doars forests and tea-gardens in the middle region,
Sunderban delta, mangrove forests and the Bay of Bengal in the south, WB is blessed with a
wide bevy of natural beauty. Added to it is the presence of a large number of sites of historical
importance and its capital, Kolkatas fame as the Cultural Centre of India. All these should
have translated into a robust tourism sector. However the reality remains that WB tourism is

quite under developed with only 3.4% of total domestic tourists and 8.3% of all foreign tourists
in India visiting the state in 2012.
This paper attempts to analyze the factors behind the muted tourism scene in West Bengal and
how those can be removed or minimized to ensure rapid growth. It tries to estimate the benefits,
both tangible and tangible which will accrue to the state with further developments in tourism.
More specifically, it tries to link employment generation in the state with growth in the tourism
sector. WB is 22nd among 28 states as far as unemployment is concerned and tourism can be used
very effectively to reduce the unemployment rate in both rural and urban areas.
The paper also aims to identify the existing and potential travel destinations and list the main
concerns affecting the growth of tourism there. Further it tries to study the demographic pattern
of the past tourists and create a relationship matrix between visitors and places preferred by them
to help the State Government come up with relevant strategies to attract maximum crowd. All
these facts and figures are then used to calculate the approximate numbers of jobs that are
expected to be created in the tourism sector.

Problem Structuring

1. Stakeholder analysis

2. Specific Stakeholder Chart


State and Central Government

Ministry of Tourism

Home Ministry (responsible for safety, law and order)

Ministry of Transport

Ministry of Cultural Affairs

Tour and Travel Operators

Private operators

State owned tourist information centers

Local travel/ sight-seeing guides

Unemployed/ Under-employed People

Jobless youth

Persons working elsewhere due to lack of local employment opportunities

People working for low wages as labourers

Existing Local Economy

Workers engaged in transport segment

Workers engaged in Hotel/ accommodation sector

Shop-keepers selling local specialties (handicrafts, dresses etc.)

Restaurants and shops

Local artisans

Tourists

Domestic tourists

Foreign tourists

Competing States

Other states offering similar natural beauty

People engaged in tourism sector of such states

Central Tourism Ministry

Media

Newspapers/ TV/Radio promoting tourism

Travelogues/ magazines featuring articles on tourist destinations

Participants in various travel fairs organized by the state

Infra-structure Sector

People associated with development and upkeep of road and railways

Labourers engaged in building amenities for travellers

Power generation and distribution to far-flung tourist spots

3. Identification of Stakes
State and Central Government

Tour and Travel Operators

Boost in tourism would lead to increase in Increase in number of tourists would result in
revenue in the form of service taxes as well as greater business and profits for such firms. To
decline in unemployment rate. It would also cater to the growing demand, many such local
result

in

development

of

infra-structural operators

facilities in the state.

would

open

leading

to

more

employment.

Unemployed People

Existing Local Economy

Tourism would result in employment facilities Tourists in any area contribute a lot to the local
for a variety of unskilled or semi-skilled people economy through their spending on various
as car-drivers, restaurant waiters, hotel service, goods and services. Tourism would also lead to
eatery stalls or even local guides. Such jobs do overall development of the area by increasing
not require much skill or capital and as such the contact with the outside world as well as by
can be done by many.

expanding the scope of activities performed.

Tourists

Competing States

Tourists want to visit places of natural beauty, Other Indian states would also want to attract
historical

interest,

adventure

sports

or more tourists so as to boost their own

somewhere they can relax. Development in economy. This would lead to competition
various amenities would lead to increase in among states to develop better tourist spots and
their

numbers.

Proper

promotion

and promote them more aggressively through

marketing of such places would lead to more tourism fairs. People living in states without
awareness resulting in greater footfall.

much tourism opportunities may turn towards


other states for employment opportunities.

Media

Infra-structure Sector

Development in the tourism sector would Any improvement in tourism would require
allow the travel magazines, travel shows etc. to basic infra-structure like roads, rails, power
feature

new

tourist

attracting more eyeballs.

destinations,

thereby etc. Thus promotion to tourism would result in


greater availability of such services.

4. Behaviour Over Time (BOT) Graph

Literature Review
1. The Frost & Sullivan Report in association with ASSOCHAM, India on West
Bengal: Unfolding Growth Strategy in August 2012 lists the sources of competitive
advantage West Bengal has when it comes to tourism. It states that WB is the only state
in the country which boasts of the three most attractive tourist destinations, namely, snow
clad mountains, sea-beach and forests. It further makes a comparative study of
infrastructure development in the state with that in the neighbouring states of Bihar and
Jharkhand and concludes that inspite of large allocations for primary infrastructure
development, expansion in roads and power in WB have been quite low. The report also
suggests placing greater stress on cultural tourism considering that Kolkata is renowned
for its culture.
2. A report prepared by IL&FS Infrastructure Development Corporation Ltd submitted
to the Ministry of Tourism, GOI in 2012 lists ways to identify the potential tourist
destinations in WB. It also suggests ways to assess the existing infrastructure in those
places and lists steps which can be undertaken by the State Government to improve the
same. Finally it takes up the example of Digha, a sea-side town in WB to understand the
tourist perception. The questionnaire pattern used can be taken as reference point to carry
out the research proposed in this paper.
3. The ASEAN Travel & Tourism Competitiveness Report 2012 lists the competitive
advantages of the tourism sector in the various ASEAN countries. The research pattern
followed in determining the obstacles as well as the enablers of development in the field
of tourism are equally relevant for India. Since ASEAN countries like Thailand,
Indonesia, Malaysia etc. are close competitors of India as far as foreign tourists are

concerned, it is imperative that that the salient features of the tourism in those countries
are studied.
4. Impact Of Tourism On Employment Generation by J. P. Singh, M. K. Mohanty, S.
N. Jena & Ashutosh Kumar Jha discusses about the various stakeholders in the local
tourism markets. It talks about the broad macro-economic interventions required to
improve both quality and quantity of jobs generated in the tourism sector. At the micro
level it talks about spatial planning, efficient provision and marketing of tourist
destinations. It also discusses the need of including more women in the tourism industry
by investing in their training and development.
5. The Steering Committee On Tourism For The Eleventh Five-Year Plan (2007-2012)
talks about how tourism can impact other economic sectors by bringing about synergies
across diverse areas like agriculture, horticulture, transport, poultry, handicrafts,
construction, etc. It goes on to explain how the consumption demand emanating from
increased number of tourists brings about a multiplier effect on the economy by
generating additional income and employment opportunities leading to large scale
poverty alleviation. It further provides detailed figures of the expected benefits due to
growth of tourism through increased national and State revenues, business receipts,
employment, wages and salary.
6. Employment and Income Potentiality of Tourism Development in Amhara Region
Ethiopia by Ajala O.A. talks about how tourism has become an appealing sustainable
economic

development strategy for the Less Developed Countries. It puts forward

figures to show that next to oil, tourism is the highest foreign exchange earner and the
highest employer of labour in the services sector. This paper examines four Tourism

Enterprises namely Hotel, Souvenir, Tour guide and Water transport businesses to pin
point the potentiality of tourism as catalyst of development. Data collected from primary
and secondary sources such as inventory field survey and questionnaire administration
were analyzed using simple statistical methods. Finally the paper concludes that
developments of Tourism generate employment and income not only for the
entrepreneurs but to the entire region.
7. An article by Mr. Samir Sinha which appeared in SME Times on 27th September 2012
lists down certain tangible goals which the Indian tourism sector ought to aim for. These
include increasing Indias share of foreign tourists to 5% of global total and expanding
employment generation by 50% within 2016. It also advocates enhancing the hospitality
infrastructure by opening new Institutes of Hotel Management and Food Crafts Institutes,
developing tourist parks, identifying clusters of villages having unique craft, ethnic art
form for development as Tourism Products and acquiring land for hotels and other
facilities especially in undeveloped areas.
8. A report on Eco Tourism & Generation Of Livlihood Through This At Sundarbans,
West Bengal by Vivekananda Sevakendra, South 24 Parganas, West Bengal explains the
concept of Eco-tourism as a form of tourism involving visiting fragile, pristine, and
usually protected areas, intended as a low-impact and often small scale alternative to
standard commercial (mass) tourism. It also discusses about Community tourism which
aims to provide benefits to local communities such as indigenous peoples and villagers in
the rural belt. The paper then aims to promote cultural and agriculture based tourism
thereby leading to empowerment of local communities specially women.

Research Problem
The decline in growth of tourism in West Bengal and consequent lack of employment generation
in this sector.

Research Objective
The objective of this research paper is to identify the main causes behind the declining growth in
number of tourists visiting the state of West Bengal and suggest strategies to better develop and
promote the tourism sector so as to increase employment opportunities in the same.

Research Questions
a) What are the reasons for the stagnating share of West Bengal in Indian tourism industry?
b) Why has WB failed to develop the many potential tourist hotspots in the state?
c) Which places can be targeted to generate maximum tourist footfall, based on profiles of
existing tourists?
d) How much direct and indirect employment can be generated by developing these places?

Proposed Methodology & Methods


1. Profiling of tourists
Based on the data available with the West Bengal Tourism department and private tour
operators, tourists visiting WB (both domestic and foreign) would be classified based on their
demography, their interests, duration of stay and approximate spending capacity.
Demographic divisions of tourists would be based on age, sex, native place and whether they
visited individually, with friends or families.
Tourists would further be classified according to the reasons for their travel: places of natural
beauty (mountains, forests or the sea), historical spots, adventure sports, religious interest or
cultural interests.
Finally, based on the type of hotels they stay in and the type of restaurants they frequent, the
tourists can be rated as per their spending power.
2. Identifying potential tourist hot-spots
Based on the information collected in the first step, probable destinations in the state which can
attract maximum number of tourists would be identified. These would be done by Government
officials taking the help of local tour operators. Such places would then be classified as follows.
a) Already developed with a sizeable tourist presence
b) In the process of development: number of tourists increasing slowly
c) Undeveloped/ virgin spots with little or no tourist presence

3. Determining ways to increase tourist footfalls


Once the spots having maximum potential have been identified, various reasons impeding the
development of tourism would be listed. These would be divided into two main categories.
a) Lack of awareness among the general public
b) Infrastructure bottlenecks such as lack of proper connectivity, power shortage, paucity of
good hotels etc.
After identifying these factors, what needs to be done to overcome them would be decided. For
this, best practices followed by other states/ countries could be adopted. Existing tourists would
be asked about the kinds of problems they faced during their stay and steps would be taken to
address their concerns.
At the same time, concrete steps to increase awareness would have to be taken. These would
include increasing the web presence for WB tourism department as well as frequent ads in print
and visual media.
An approximate budget and time-frame would have to be prepared and steps taken to ensure that
the plan runs according to schedule.
4. Estimating the increase in number of jobs over a period of 5 years
Once all the above steps have been completed, probable increase in the number of tourists
visiting West Bengal would have to be calculated. This can be done from historical data for
different states collected from Government records. Based on this increase, the approximate
number of jobs created in related fields like transport, infra-structure, tourist amenities, local
handicrafts etc. would be calculated. Such an exercise can be carried out for a few representative
spots identified in step 2 and the results extrapolated for other places.

Causal Loop Model


The different variables affecting the growth of tourism and subsequently increase in employment
opportunities in West Bengal are:a) Infra-structure facilities
b) Tourism Promotion
c) Government policies
d) Tourist amenities
e) Employment generated in tourism sector
f) Number of tourists visiting
g) Amount spent by Government on tourism
h) Volume of transaction by tourists during their stay

Thus we see that all the loops are Re-enforcing loops which shows that bringing about
development in any one of the factors is sure to bring about improvements in all the other factors
as well. What needs to be done is to ensure that the process of development begins at the
grassroots level and is not limited to a few pockets alone.

Limitations of the study


There are a few limitations to the study and the type of research methodologies adopted. Firstly,
it might be difficult to collect exhaustive information required for profiling of tourists. There
might be a number of other reasons behind the low volume of tourism in WB which are not
captured from discussions with existing tourists. Every place might have its own peculiar set of
problems which prevents its growth as a tourist hotspot. The broad suggestions provided might
not solve each and every problem.
Estimating the probable increase in the number of jobs owing to growth in tourism might not be
an accurate exercise. In many cases increase in tourists might be in the same locations leading to
geographically skewed job creation.
Finally, the study ignores the effect of market conditions in estimating the growth in number of
tourists. With recession in Europe and USA as well as rising inflation in India, tourism industry
in general has taken a hit. Thus extrapolating the growth figures of the past decade might lead to
over optimistic results.

References
1. India: How does Travel & Tourism compare to other sectors? - World Travel and
Tourism Council
http://www.wttc.org/site_media/uploads/downloads/India_sector_release_study.pdf
http://www.wttc.org/site_media/uploads/downloads/traveltourism2011.pdf
2. The ASEAN Travel & Tourism Competitiveness Report 2012
http://www3.weforum.org/docs/WEF_TTCR_ASEAN_Rankings_2012.pdf
3. Indian Budget Allocation: Department wise
http://indiabudget.nic.in/ub2012-13/bag/bag42.pdf
4. IL&FS Infrastructure Development Corporation Ltd (2011), Identification of Tourism
Circuits across India: Interim Report, by Unemployment rates in India, State-wise
http://indiamicrofinance.com/unemployement-rates-urban-rural-india-2010.html
5. The Steering Committee On Tourism For The Eleventh Five-Year Plan (2007-2012)
6. Vivekananda Sevakendra, South 24 Parganas, West Bengal (2010), Eco Tourism &
Generation Of Livlihood Through This At Sundarbans, West Bengal
7. Ajala O.A (2008) Employment and Income Potentiality of Tourism Development in
Amhara Region Ethiopia; Ethiopian Journal of Environmental Studies and Management

8.

J. P. Singh, M. K. Mohanty, S. N. Jena & Ashutosh Kumar Jha, Impact Of Tourism On


Employment Generation