Union Finance Minister Nirmala Sitharaman unveiled the union interim budget 2024 in Lok Sabha today while also emphasising significant developments in the travel and tourism sectors. Highlighting plans to propel growth in these areas, Sitharaman announced substantial investments in infrastructure and initiatives aimed at promoting tourism across India. The overall budget for the Ministry of Tourism, Government of India has also been increased to INR 2,000 crore from INR 1,600 crore last year.Infrastructure boost for travel and aviation sectors
Sitharaman revealed plans for a massive infrastructure push in the travel and aviation sectors, with an allocation of INR 85,000 crore for the development of 72 new greenfield airports. By 2025, the government aims to build 71 new airports, bringing the total count to 220. Additionally, projects for port connectivity and tourism infrastructure on India’s islands, including Lakshadweep, are set to be undertaken, promising employment generation and increased investments.
The finance minister underscored the importance of promoting tourism in India by announcing a framework for rating iconic tourist centers based on the quality of facilities and services. Long-term interest rate loans will be provided to states for comprehensive development and branding of these centers, fostering domestic tourism and attracting foreign visitors.
Reaction on budget from the industry
Ajay Singh, CMD, SpiceJet and President, ASSOCHAM commended government’s push for infrastructure and increase in spending that will have a multiplier effect on the economy. “It is an India-first budget. I commend the evident railway corridors and the one lakh crore fund for research and development and the startup sector. The emphasis on clean energy, technology and digital infrastructure will make India a world leader. This is India’s moment and this budget is part of a continuous process of making policy that will provide massive opportunities for India and Indians,” he further mentioned. Gautam Aggarwal, Division President, South Asia, Mastercard said government investment in the tourism sector is a welcome step that bodes well for the Indian economy. ” Coupled with a strong focus on infrastructure development, it will lead to the emergence of new tourism corridors, resulting in greater interest from domestic and international travellers to visit the less explored parts of the country. Mastercard is closely aligned with the government’s vision of tourism, contributing USD 1 trillion to India’s GDP by 2047,” he said.
“Government of India’s continued focus on domestic tourism in the interim Budget 2024-25 is encouraging. Empowering iconic destinations and local entrepreneurs through interest-free loans and quality ratings will elevate India’s tourism landscape. The projects to enhance connectivity in the country through the development of airports, railways, metro lines, ports in our unexplored island including Lakshadweep, and tourism infrastructure will enhance demand and generate employment. This is not just a boost for tourism, it’s an investment in India’s potential. We are optimistic about additional futuristic support from the Government in granting infrastructure status to hospitality and tourism, which will help us achieve a long-awaited status. We foresee that this will have a multiplier impact and drive significant investment from the private sector,” said KB Kachru, Chairman Emeritus & Principal Advisor, Radisson Hotel Group, South Asia sharing his reaction.
Tejinder Gupta, Partner and Tourism & Hospitality Industry Leader at Grant Thornton Bharat, hailed the focus on tourism promotion, emphasising its potential for entrepreneurship and soft power diplomacy. “The promotion of spiritual tourism and domestic tourism is India’s way of building soft power by reinforcing the Indianness amongst the Indian diaspora across the world. This is a great way of building diplomatic power in a multi-polar world,” he said.
Aashish Gupta, Consulting CEO, FAITH, expressed hope for continued support in the actual budget later in the year, emphasising the need for infrastructure status for the hospitality industry and incentives to boost tourism. “Since this was a vote on account and an interim budget, no big announcement was expected. It is hoped that the actual budget in July will take forward the statement of Intent announced in the interim budget of international promotion, developing iconic destinations in partnership with states through an incentive-based system, further focus on domestic tourism and recognition of mice tourism capabilities of India further to G20 in India and also continuing focus on new airports and Vande Bharat trains and high traffic highways,” he said.
Rajiv Mehra, President, Indian Association of Tour Operators (IATO), stressed the importance of overseas promotion efforts to attract tourists to India and called for urgent action in this regard. “Though we welcome the increase in budgetary allocation to INR 2,000 crore from last financial year’s INR 1600 crore and mention of branding in the budget speech of the FM, we must remember that unless we dont do roadshows overseas, Familirastion trips and publicity campaigns abroad till then we would not be able to draw tourist to our country. Every country in our neighbourhood is courting Indian tourists, but our effort towards drawing tourists from abroad is zilch. We have to understand that we need to compete, but the urgency and the importance this matter should receive is still missing,” he mentioned.
Aloke Bajpai, Co-founder & Group CEO of ixigo, welcomed the focus on regional air connectivity and infrastructure development for offbeat tourist destinations, foreseeing a positive impact on the tourism sector. “We are also happy to see the government taking steps to develop new tourist destinations in India that can compete on a global scale. Infrastructure development and improved connectivity for offbeat tourist destinations like Lakshadweep will help build and promote the unexplored and hidden gems of India and will help further boost the tourism sector,” he said.
Nishant Pitti, CEO & Co-Founder of EaseMyTrip, lauded the government’s attention to tourism, aviation, and railways, highlighting the potential for economic growth and job creation. “The dedicated efforts towards developing aviation and rail infrastructure, especially through the commendable initiatives of UDAN and the PM Gati Shakti scheme, encouraging States to promote iconic tourists’ centers by providing interest-free loans are noteworthy with a special focus on developing island tourism and fortifying port connectivity, including Lakshadweep,” he mentioned.
Pradeep Shetty, President, Federation of Hotel & Restaurant Associations of India (FHRAI), also welcomed government’s enhanced focus on the promotion of MICE, religious tourism, iconic tourism centres and domestic tourism, which according to him will lay the foundation of tourism development in the Amrit Kal and equip the sector to achieve the ambitious target of welcoming 100 million tourists by 2047.
“This strategic initiative promises a seamless experience for tourists and unlocks tremendous growth avenues for the hospitality sector. By enhancing infrastructure it aligns with a mission to exceed evolving traveller expectations, making Lakshadweep a premier destination for discerning travellers. This visionary approach transforms the islands into a magnet for tourists, creating new opportunities and propelling the hospitality sector into an era of unparalleled growth within India’s dynamic tourism and hospitality landscape,” he added.
Chirag Agrawal, Co-Founder of TravClan, emphasided the importance of investment in tourism infrastructure and expressed optimism about the government’s initiatives. “We hope for more measures from the government that continue to build our air infrastructure and hospitality sector. This development will not just invite the world to explore our heritage but also ignite local economies and our pride,” he stated.
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The hosting of the G20 Tourism Working Group in Jammu and Kashmir has marked a significant turning point for the region’s tourism industry. Calling it the ‘game-changer’, Syed Abid Rasheed Shah (IAS) Secretary Tourism & Culture, Govt of J&K stated that a notable surge in inbound tourist arrivals, particularly foreign tourists, has been observed after the event.
“The number of tourists visiting us from abroad this year is the highest in the last 30 years,” he told ETTravelWorld. “Our eventual goal is to become one of the world’s premier tourist destinations,” Shah continued.
The transformation of Jammu and Kashmir from an underrated tourism destination to a thriving tourism hotspot with 70-80 daily flights landing just in Kashmir today is nothing short of phenomenal. When it comes to assessing the overall resurgence of tourism in Jammu and Kashmir, the numbers tell a compelling tale too. “Last year, we recorded a historic high of 1.88 crores in tourist numbers for the calendar year 2022,” said Shah, adding that this milestone is indicative of the region’s growing appeal.
“In the current calendar year, our expectations are soaring even higher. We have already exceeded last year’s foreign tourist arrivals by a significant margin,” Shah revealed.
For the remainder of the year, the numbers are expected to grow at a faster pace, he added.
Domestic tourism, too, has shown impressive resilience and growth. Abid Shah pointed out, “Our domestic arrivals this year are on track to surpass last year’s figures. We’ve experienced consistently high occupancy rates throughout the year, and this is due to the unique appeal of Jammu and Kashmir in the tourism landscape.”
While the G20 Tourism Working Group meeting, hosted in Kashmir during the India’s Presidency this year acted as a catalyst for the region’s tourism sector, Shah asserted that it also has contributed in many ways to bringing Jammu and Kashmir and its tourism to the global tourism map.
Speaking about the tourism sector’s prime importance, Shah stated that it is the backbone of J&K’s economy. It contributes about 7.4 per cent of the GSDP of J&K, giving 1 million jobs directly and indirectly. The impact, he said, extends far beyond numbers, reaching into the livelihoods of countless individuals and the broader economic landscape.
“In the next five years, we aim to elevate our tourism contribution to 10 per cent of the GSDP. Achieving this would not only catalyse the local economy but also generate millions of jobs,” he added.
Addressing the aspect of connectivity, Shah underscored the existing road and air links and the anticipation of railway connectivity in the near future, extending the existing railway network from Jammu to the Kashmir Valley. This, believes Shah, will lead to a further meteoric rise in domestic tourist numbers. However, this influx needs careful handling.
300 new destinations to be developed
The government has taken a series of policy initiatives, primarily focused on sustainability in tourism. “Given Jammu and Kashmir’s status as a Himalayan ecology and a biodiversity hotspot, we are now focused on promoting sustainable tourism by carefully addressing the carrying capacity of various destinations. Therefore, to ease off the burden on popular destinations, we have identified 75 offbeat destinations, including Wadwan, Basholi, Baraderi, Basantgarh, and more, and are working to promote them,” Shah explained.
The holistic approach extends to cultural sites and heritage preservation as well. Shah revealed that in total, about 300 new destinations are slated for development and promotion.
While proper infrastructure development in these destinations will take time, Shah remains optimistic. He predicts that, in the coming years, these policy initiatives will bear fruit, enriching both the tourism experience and the local economy. “Importantly, tourism has now officially been granted the status of an industry in Jammu and Kashmir, ensuring that those wishing to explore the benefits of the sector can access subsidies and other advantages,” he informed.
Also, the heart of these initiatives lies in the promotion of homestays, a concept that resonates well with the local socio-cultural fabric and the environmental and biodiversity elements specific to the Himalayan ecology, explained Shah. “The idea behind these is to minimise the environmental footprint while ensuring a memorable experience for tourists.”
“Also, we are keen to take tourism to the people,” Shah expressed. Homestays, he added, empowers local communities and enables rural tourism to flourish. The U/T government’s efforts in this direction received recognition, with Dawar in Gurez being rated as one of the best tourism villages in India by the Ministry of Tourism recently. This initiative encourages a vibrant, self-sustaining tourism ecosystem in remote but beautiful locales.
Involving youth in tourism
Youth involvement in the tourism sector is a top priority for Jammu & Kashmir, emphasised Shah and the government is actively crafting initiatives to engage the younger generation.
The government has selected villages for homestay development in the Union Territory that will not just boost the tourism sector but also create sustainable employment opportunities for the region’s youth. Under the initiative “Mission Youth”, announced last year, these villages will undergo a transformation, igniting their potential as tourist destinations and will thereby, add to more employment opportunities for youth.
“Our focus is on actively engaging the youth in tourism. Surprisingly, we have an astounding 69 per cent of our population below the age of 35, a demographic advantage that we are determined to leverage. Without linking them to the economic opportunities within the tourism sector, we believe we cannot achieve equitable growth, provide avenues for livelihood, self-employment, and foster opportunities for personal growth,” Shah said.
Besides, Jammu and Kashmir has also embraced the concept of centre-run Yuva tourism clubs in some of the remotest locations, such as Warwan in Kishtwar, Jammu. Recently, this initiative bore fruit with a grand festival where local entrepreneurs, young boys, and girls actively participated.
“Similar events are cropping up across the region, including in the remote enclave of Bangus in Kupwara, close to the Line of Control. These initiatives, bolstered by the support of the Government of India, will ensure that the region’s youth play a central role in shaping its tourism landscape,” he added.
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