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Wednesday, 25 September, 2019, 14 : 53 PM [IST]

Need for Booster Dose

It's that time of the economic cycle where nobody is talking about growth but survival. It's not just one sector but the entire economic activity in the country is in doldrums as reports of recessionary trends are seeping in. While it was the drastic dip in demand for the automobile sector which caught the headlines and made the government wake up and concede openly that all is not well with the economy, the reports from other sectors also do not augur well and gives indications that the days ahead are going to be a bumpy ride.

Although travel and tourism industry hasn't started talking openly about the slowdown, may be because most of the industry associations are on annual conventions mode, being a discretionary spend, travel and leisure expenses would definitely be hit if not in the short term, but in the medium and long term. Moreover, India's travel industry largely thrives on corporate travel and related events, and any shrinkage on those fronts would deliver a body-blow to the sector which has already witnessed some top brands shutting shops due to several factors, including inclement business environment.

Moreover, the 'India inbound story' seems to have lost its momentum largely because of global factors and to certain extent the mismanagement by government of Indiatourism marketing activities in source markets. Those industry bodies which used to espouse the cause of Incredible India for decades have also slowly started shifting focus to outbound.

With the overall economic scenario looking dull, all eyes are on the government now as to how it reacts quickly with measures to stop the economy from slipping further. The trade and industry in the country look divided on the issue of GST reduction for certain sectors to pep up demand. However, the travel, tourism and hospitality industries are united on reduction of GST. They want to see the upper cap of 28% for hotel rooms above INR 7,500 brought down to make India a competitive destination. Therefore, the GST Council meeting on September 20 will be crucial for the tourism industry as well.

When the Ministry of Tourism is proposing to celebrate 2020 as 'Visit India Year' to revitalise the fledgling inbound, the trade and industry is looking for unambiguous policy directions from the government to help the cause of Incredible India. Decisions like creating a new category of e-visa or giving nominal visa fee relaxation for few months cannot and will not serve the long-term goals. Piecemeal approach should give way to solid full-hearted decisions if Visit India Year has to deliver results!

PKrishna Kumar
Bureau Chief
krishna.kumar@saffronsynergies.in
 
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