Tourism: A peek into India’s future prospects

The tourism industry is an integral pillar of India’s economy and contributes significantly towards GDP growth and employment generation.

Although India offers diverse avenues catering to varied consumer segments, it is still striving to reach a prominent position as global tourism destination. India Business and Trade (IBT) spoke to Dr. Pralok Gupta, Associate Professor, Centre for WTO Studies, Indian Institute of Foreign Trade and Member of Committee For Advanced Trade Research, TPCI to discuss how India is addressing current challenges in the global landscape and what the future holds for the tourism sector.

IBT: How has the tourism industry evolved post pandemic? What are the major changes we are witnessing?

Prof Pralok Gupta: Tourism sector was almost shut during the pandemic, and has evolved significantly post-pandemic. Since people all over the world were confined to their homes during the lockdown, they all were longing to go out in whatever capacity they could. This led to an increased pressure on the tourism industry all over India. Currently, all tourism service providers, whether hotels, taxis etc., are in dilemma, since the Covid-19 has emerged in a cyclical manner over the past three years. The pandemic has not completely ended, making all service providers skeptical on hiring staff on full throttle like in the pre-Covid era. On the other hand, the lack of workers and hiring of temporary staff has led to a drop in quality of service, thereby impacting the sector negatively.

IBT: What are the current threats to global tourism growth in terms of inflation, recession and geo-political uncertainties?

Prof Pralok Gupta: If we see demand side, there is no concern or threat. The only threat is that the travel prices have recorded a surge. From international tourism perspective, an air ticket to countries like France, Switzerland and UK per person ranged between Rs 60,000- 70,000, which has risen to more than Rs 1 lakh per person, post pandemic.

Similarly, tourists who are travelling within India are facing hikes in prices. This may add to the current challenges, since international tourists may shift to domestic tourism. This could be a very significant threat to the recovery of  the tourism sector globally at this point of time.

And of course from the supply perspective, because of geo-political issues like Russia-Ukraine war, everything is becoming costlier. In terms of hotels, fleet or even the transport, everything is becoming more and more expensive, which is a problem for both clients and service providers. A service provider has to increase its cost and tourists expect good services, since the prices are high. Tourists are not thrilled, since services provided are not in sync with the amount that is charged

IBT: How is India placed currently as an international tourist destination? What are the major strengths and weaknesses?

Prof Pralok Gupta: I would say that India is presently in good shape. From all perspectives, we have something to offer to international tourists. For example, for those who love beaches, we have Goa or Kerala; for people who love religious places, we have Varanasi, Haridwar and many more; for those who are interested in ancient monuments and culture can visit Taj Mahal etc. And those who want to travel to India for spiritual purposes can visit places like Rishikesh.

So that means we have something to offer to every tourist who wishes to visit India, which is the biggest strength of Indian tourism sector. Unlike many other countries in the region, such as Maldives, which is dependent only on beaches and water sports, India is not dependent on one particular type of activity. Its portfolio is very diverse.

Unfortunately, in terms of providing services like entertainment and adventure activities, the tourism sector of India is lagging behind. The tourism industry and policy makers should be well aware of the fact that the services are not just a product to be delivered. It is a feeling and experience which needs to be enjoyed by the tourist from day one. Unless tourists experience that feeling, one cannot create a brand image and that is still missing from the overall ecosystem for the Indian tourism sector.

IBT: How do you view government initiatives to boost the sector? What further measures would you like to propose?

Prof Pralok Gupta: A very big initiative that the Indian government has undertaken is the easing of Visa and availability of e-visas for multiple countries. Secondly, in terms of connectivity, roads and infrastructure have been improved over time, which saves a lot of time for travelers moving from one destination to another. In terms of modernization, facilities at railway stations and airports have been improved and they are trying their best to give better experience to tourists.

However, in spite of efforts from the government, there are some issues yet to be addressed. But those things are done in bits and pieces. We have to understand the complete ecosystem of the tourism services and try to give tourists a good experience throughout their stay.

To start with, when a person is applying for visa, we need to ask questions like: Is it easy to fill application form? Is there a lot of documentation required? These factors could impact largely on the travel experience, so a detailed assessment needs to be done in this area. For example, in Thailand, we have visa on arrival, so one can simply go and fill a small form for visa. On the other hand, if there are multiple formalities to be done for getting a visa, then a tourist may consider Thailand over India.

When an international tourist lands at an Indian airport, the experience, particularly when he comes out of the airport, is still not up to the mark. It is still far from what we could achieve, especially when compared to international benchmarks.

When international travelers are travelling to India, the facilities available at the place where they are staying are very important to provide them the Incredible India experience For this, policies should be attuned at all levels. Many of these things fall under the domain of state governments and not in the ambit of central government. If there is some inappropriate experience with a tourist, it is always good to have an ecosystem in place to rectify these bad experiences. Although the chances of something bad happening cannot be completely eliminated, but one should work towards that direction.

The government’s recent initiative on identifying 50 tourist destinations is a very good step, as we need to identify prominent destinations as well as the kind of facilities we can develop for international or domestic tourists. However, we need to be cautious on implementation of facilities that we will be offering, like developing good ecosystems at those places as well as ease of reaching those destinations.

IBT: What kind of job opportunities does this industry potentially offer in the coming years and what are the major skilling gaps that need to be bridged to improve India’s performance?

Prof Pralok Gupta: The tourism industry is one of the highest employment multipliers and offers all kinds of employment opportunities, whether unskilled, skilled or semi-skilled. For semi-skilled and high skilled labor, there would be an increase in demand since this segment could provide more value added services in the future.

There would be even more demand for skilled professionals, who can provide state-of-the-art services to consumers and international tourists. This includes professionals who can provide translation services or guide services in different languages. Currently, we do not see much demand or employment for such skills, but going forward, once we are successful in promoting our tourist destinations and there is higher inflow of tourists from across the world, such services will be hugely in demand.

Services are not only confined to tourist guides, but also at interfaces at the hotel level. For instance, a visitor coming from Japan might be knowing English language, but they would be delighted to find someone who could speak and guide them in Japanese, further increasing the value of services provided.

IBT: What is the role of branding in the success of India’s efforts to boost tourism? How should we approach the branding strategy?

Prof Pralok Gupta: Branding holds a huge impact in the tourism sector, as what ultimately matters is the brand name. People prefer destinations like Paris or Switzerland because of the brand name, which is created through different mediums. They offer good locations and opportunities for movie shoots, which promotes their tourism. The number of Indian tourists visiting Spain significantly increased after the Zindagi Na Milegi Dobara movie, which was shot in that country.

In India, we should also focus on good policies to promote movies shoots in different locations of India, as it is a very impressive medium of conveying your brand image without much cost. So, from the branding perspective, this sector is interlinked with other sectors, so we can have liberal policies for movies and documentaries to shoot within India. It can be a good way to promote the tourism sector.

As far as marketing is concerned, we need to have an approach to identify suitable markets, since we cannot have branding across the world in all countries. To start with, we can identify the source countries and what kind of tourists are willing to visit India. For e.g. If we are branding Goa, we cannot target religious tourists, which means that the branding is to be done accordingly.

Additionally, we need to analyze tourists who are traveling to nearby countries. We can offer alternate locations in India with good features at similar costs, which would likely shift some of these tourists to India

IBT: Why do you think India is lagging behind smaller countries despite having rich cultural heritage?

Prof Pralok Gupta: In terms of process that are being followed, we have taken various steps like ease of accessing, but still we are lagging behind as compared to some other countries. Secondly, many destinations fall under UNESCO heritage sites, but if you ask a domestic tourist, there is not much awareness about these sites. Also, many of these monuments are not in a good shape and require restoration.

So somehow, even today we have not come to that point where we can showcase our tourism services with world class experiences, though governments at both central and state levels are taking appreciable steps in this direction. For the future, we need to consider that when we are developing these tourist destinations, a number of associated activities, which feed into the experience of tourists, are also to be developed simultaneously.

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Dr Pralok Gupta has been actively engaged in policy making by Ministry of Commerce and Ministry of Finance on various trade and macroeconomic issues. He is also a member of India’s delegation on services negotiations for various FTAs. He has been appointed as Member of the ‘Task Force on Services Sector Exports’ by Ministry of Commerce, Member (Sectoral Expert) of the ‘Inter Ministerial Sub-Group on Data in Trade in Services’ by Ministry of Commerce, Member of the ‘Technical Group on Data in Trade in Services’ under the Chairmanship of the DGCIS, Kolkata.

Dr. Gupta has been actively engaged in providing training on various trade issues to delegates and diplomats from developing and Least Developed Countries (LDCs). His articles on contemporary trade issues get published in international journals, books and business newspapers and he has a number of books and book chapters to his credit.He recently edited a book titled ‘E-commerce in India: Economic and Legal Perspectives’. He has also been associated with various consultancy and research projects for corporate bodies, the government and international and multilateral institutions, such as the OECD, British High Commission, UKIERI, European University Institute, South African Institute of International Affairs, NCAER, ICRIER, etc.Earlier, Dr Gupta served in the UP State Government and Industrial Finance Corporation of India.

He is also a Policy Leader Fellow of the European University Institute, Florence and a certified Fintech and Regulatory Innovation professional from the Judge Business School, University of Cambridge, UK. Dr. Gupta has a Ph.D. in Economics and Social Sciences from IIM, Bangalore.