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Priority on inbound and domestic tourism
Bhisham Mansukhani - Mumbai
The Union Budget 2006, for one did good by mentioning tourism
and did one better by betraying the theme for the sector, at least for the impending
fiscal. Incredibly, inbound and domestic tourism. Tourist inflow and movement
within the country stood out as the resounding focus for the finance ministry,
outbound industry trends of increasing business class usage and luxury cruises
were perceived as taxation candidates rather than segments deserving sops.
The Finance Minister's agenda marks a potentially watershed
year for inbound and domestic tourism on more than one front. It is for the
first time ever that circuit tourism has received a reference so direct and
a canvass so huge. The Golden Triangle hitherto was rated as India's only real
tourism circuit while other states promoted themselves in isolation. The Finance
Minister's proposal to create 15 tourism circuits could potentially integrate
all the states into a strategic cross-promotion that could be mutually beneficial.
WTTC India Initiative chairman and TAAI president, Ashwini Kakkar, believes
this proposal has historic implications for Indian inbound as does the impetus
for rural tourism in the form of a proposal to develop 50 villages in the area
of art and craft. "The recognition of tourism as a great generator of employment
augurs well for the future. The identification of 15 new tourism circuits and
50 villages to be developed with a specialisation in arts as tourist attractions,
tapping what is India's inherent strength, reveals strategic thought on the
part of the government," Kakkar said.
He was also encouraged by the increase in the budget outlay
for the industry, up from Rs 786 to 830 crore. There was, he believed though,
some cause for anxiety. "General travel has been brought under the tax
net, pending a notification in the future while urban infrastructure with the
exception of metro rail, remains in status quo. Also, the dire need of additional
hotel rooms has been thwarted by the absence of industry status for hospitality
and now, the new tax on management contract will hit this industry which relies
on this route for growth and expansion," Kakkar lamented.
Another veteran industry observer, Prem Subramanium noted
the huge positives for surface transport in the budget, which would have direct
implications for domestic tourism. "The improvement in surface connectivity
and transport will give rise to a new segment of road travellers, hence providing
tour operators a new target market. New integrated circuits and new tourism
villages would result in an increase in short haul trips and weekend gateways
wherein people will look for newer experiences rather than trophy hunting. Self
drive holidays would be a new sector to explore.”
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