April 04, 2019 | Shashank Shekhar | The Big Picture
The big takeaway from BITB India Tourism Summit was that the industry needed to take the lead in driving India’s tourism. Industry stakeholders expected the government to play the role of an enabler, with focus on creating liberal policies and augmenting infrastructure.
A: The Big Picture
A1. The industry believes that addressing challenges would require a clear demarcation of responsibilities
A2. The government must provide an enabling policy framework and build institutional infrastructure.
A3. That the industry has undersold itself as a principal pillar of national growth is the overwhelming sense among stakeholders. It must become more vocal to raise issues, assuming a leadership position.
A4. Both industry and government need to reimagine and innovate. Positioning India as a desirable destination for domestic and international audiences will require an innovative approach that weaves in elements of storytelling and experiences, equally focussing on India’s rich tangible and intangible heritage. Each will have to play its part with precision for tourism to take centre-stage in India’s mainstream narrative.
A5. Important to note, this effort must be undertaken in a manner that tourism plays a more profound role as a unifier of people and communities.
A6. Tourism needs to be responsible, ethical and sustainable for the society, environment and all its constituents, direct or indirect.
The aviation industry requires a more favourable policy mechanism to compete globally, industry experts suggest. A well-rounded intervention to bring more cost competitiveness in operations and augmenting the infrastructure are pressing needs for the sector.
B1. Restructure the taxation policy on ATF. An expensive ATF is stifling India’s ability to compete globally.
B2. Cost competitiveness, infrastructure and promoting growth needs more attention among policymakers.
B4. The exorbitant distribution cost needs to be addressed. It is putting FSCs at disadvantage, compared to LCCs. It is a concern for an industry working on very low-profit margins.
C: Online and Technology
The way forward is more investments in areas like Artificial Intelligence (AI), Big Data Analysis and Machine Learning. Given the fast-changing profile of the consumer, online players need to create more ‘on-the-go’ solutions. A heavily-regulated environment is a deterrent to more investments and, consequently, the organic growth of the sector.
C1. Technology is enhancing the user’s online experience and much of the interface is being handled by chatbots. The personalisation of the offering is going to be the next big leap in the online space.
C2. A strengthened mobile-based interface environment is fortifying existing intermediaries, simultaneously creating new ones. A heavily regulated environment is counter-productive to shoring up investments.
C3. The industry needs to focus more on creating a larger experience, instead of pricing, on the online platform.
C4. Online platforms need to invest more in artificial intelligence and machine learning as new-age travellers are increasingly looking at on-the-go solutions and minimal human interface.
C5. Technology is on course to cut down inefficiencies and bring more parity in the cost structure.
C6. Traditional travel agents and tour operators need sustainability. The undercutting of travel agents and operators by OTAs has created a ‘rack race’ to sell inventory at unsustainable prices. The discounting war will fizzle out if travel agents are provided with a fair share of the business.
C7. The digital infrastructure needed for the growth of the online sector is already in place. Optimum utilisation of resources is needed to provide a boost to the industry.
D: Infrastructure and hospitality
Innovative interventions by the government and a more liberal view towards the industry in matters of access to capital and rates emerged as noticeable demands.
D1. The hospitality industry needs preferential access to capital and a more appropriate taxation structure to create more employment opportunities.
D2. Keeping in mind the high cost of real estate, a mixed-use development of infrastructure is a prudent means of maximizing output.
D3. The hospitality industry is a creator of employment and no longer a luxury industry. It must be understood and appreciated by policymakers, not across the centre but also amongst the states.
D4. Revisit the hotel pricing policy and address the ad-hocism in the pricing structure. An omnichannel parity in pricing would multiply web-based businesses.
D5. Spaces and FSI must be provided for mid and budget segment hotels.
E: Sustainable culture, heritage, and responsible tourism
The industry needs to re-examine existing concepts, such as carrying capacity, incorporate newer dimensions of the larger visitor experience, among others. India’s heritage conservation requires creating many heritage entrepreneurs. Yoga and Ayurveda, India’s most noticeable intangible heritage offerings, needs more assiduous promotion.
E1. Make certification mandatory of agents and operators to drive sustainability. A compliance-based legal system is needed.
E2. India needs a national policy on culture and heritage.
E3. Heritage conservation requires heritage entrepreneurs. India must develop heritage entrepreneurs to sustain and restore heritage – which is outside the purview of the Archaeological Survey of India.
E4. India’s intangible heritage, most notably, Yoga and Ayurveda, needs to be promoted more assiduously, as they have the attraction to become global draws.
E5. Revisit the concept of carrying capacity. Carrying capacity must examine capacities of all kinds – physical, social, economic and others.
E6. India must look beyond numbers and incorporate the larger visitor experience in determining the carrying capacity of a destination or a structure.
E7. The government must reward, recognize and enable those who are incorporating best practices of responsible and sustainable tourism. An award and punishment policy could be followed. Also, a system must be instituted to regularly sensitize and educate the trade, and the consumer.
E8. Address the ban phenomenon, following the over-exposure of a destination, in India. Destinations can adopt best global practices to bring more sustainability into their offering.
E9. Corporate entities need to play a larger role in community development. Community participation and creating local-level facilities goes a long way in fulfilling corporate social responsibilities.
E10. Industry must play a more active role in conserving heritage.
F: Addressing the inbound conundrum: The road ahead
Going local and authentic is key to building a quintessentially Indian experience. The industry needs to infuse the art of storytelling in promotion to drive deeper audience engagement. A targeted marketing initiative is needed to create an impact on key potential markets.
F1. The power to drive Indian tourism lies with small entrepreneurs. The industry must refrain from standardizing the tourism product, instead create more local and authentic experiences.
F2. The art of story-telling needs to be incorporated into India’s tourism outreach. Countries with much less to offer have done a far superior act of story-telling, thereby drawing much greater attention towards themselves. India must invest in creative a narrative around its products and destinations.
F3. India must favour value over volume in courting international inbound tourists. High-value consumers would always bring more gains than sheer numbers.
F4. The global MICE market is a lucrative proposition. The industry must focus on getting more events into India. India has adequate infra already in place to cater to mid-level events.
F5. The Incredible India campaign must focus on potential high-value markets and launch extensive engagement campaigns. Carpet-bombing of publicity and outreach material is required to make a visible impact in a new market.
F6. The B2C demand is created by governments. The government must take onus of generating large-scale demand and the industry must service those numbers.
F7. The industry must refrain from over-fixation on the international inbound. India’s domestic segment is where the big business is happening.
F8. F&B is driving travel, especially among new-age travellers. Look into tapping Indian culinary offerings for tourism. Industry associations must join hands with the government to conduct food festivals highlighting India’s diverse street food offerings.
F9. Ensure a stringent implementation of guidelines by state governments to boost adventure tourism while maintaining the best levels of safety and security.
F10. A liberal visa policy has emerged as a crucial element of destination promotion. Several countries have positioned themselves as ‘tourism-friendly’ destinations through a relaxed and welcoming visa policy. The government must incorporate the visa element in planning for its global outreach.
F11. GST rates must be revisited. It must be brought down for India to compete with its neighbouring markets.
G: NITI Aayog’s vision for India’s Tourism @ 2022: An industry perspective on the document
The recently released NITI Aayog document demonstrates good intentions from the government. However, the lack of clarity in implementing these recommendations needs to be examined in more detail. The industry believes that NITI Aayog’s modus operandi of roping in technocrats must be emulated in ministries across the board, especially in the tourism ministry.
G1. The NITI Aayog vision document is “feel-good” literature but it stops short of suggestions on how these recommendations would impact the ground-level bottom line. There needs to be more clarity on the way forward.
G2. A Nation Tourism Board must be constituted at the earliest. The private sector must lead the board with an adequate government representation. Government’s role should be more of mentoring and enabling.
G3. The country must build capacity, across the board, to bring about a transformative change. The country’s infrastructure and tourism would grow by leaps if the success of the aviation sector is replicated in railways and road infrastructure sectors.
G4. Big-ticket infra will always be institution-driven. Therefore, the government must continue undertaking large infra projects which positively impact growth and consumption.
G5. Urban planning needs to be re-imagined. A more innovative use of spaces and infrastructure must be undertaken to make them visitor-friendly.
G6. Experts must become a part of policymaking. The NITI Aayog’s modus operandi of roping in technocrats, field experts and subject-specialists must be emulated across ministries, especially in the tourism ministry.
G7. The industry must take responsibility to bring a positive change in the ecosystem. It must be vocal against any arbitrary government policy.
H: Industry’s role in driving tourism: Expert speak
H1. The industry needs to do more to sensitize policymakers about the sector’s importance in creating employment. Tourism is a ‘low-hanging fruit’ for the rapid economic growth for the next decade.
H2. Tourism is a state subject. Therefore, industry must engage more actively with state governments to bring more focus on the industry.
H3. The tourism sector should be featured in the upcoming Economic Survey as an industry in its own right. It would bring a new awareness and recognition for the sector in the country’s economic scheme on things. Industry stakeholders should respond positively by providing relevant statistical data to the Ministry of Finance to make this possible.