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T&T industry expresses disappointment with Budget 2024

The travel and tourism industry in India has expressed disappointment over the Union Budget 2024-25, which failed to address the aviation and hospitality sectors, instead concentrating solely on the development of religious circuits.

Industry stakeholders had hoped for a significant overhaul concerning Tax Collected at Source (TCS) and incentives for tourism promotion. There was also an expectation for immediate efforts to revamp India’s global image as a tourist destination and to introduce visa-free entry on a reciprocal basis.

Here are some of the views of the industry experts: 

Madhavan Menon, Executive Chairman, Thomas Cook (India) Limited (Thomas Cook, SOTC, Sterling Holidays and TCI)

This year’s Union Budget has opened new doors to development, specifically for domestic and inbound tourism. With the focus on special development funds/ programms for the socio-cultural-religious potential of iconic temple corridors including Gaya’s Vishnupad & Mahabodhi temples into world-class pilgrim and tourist destinations (to be modelled on the success of the Kashi Vishwanath temple corridor), the Government of India’s intent is encouraging. Additionally, the comprehensive development of the Rajgir Jain Temple site; rejuvenation of the historical gem of Nalanda & Nalanda University into a major religious-tourist centre, would have a multi-pronged impact. While positioning India as a vibrant global tourism destination, it will also accelerate job creation and economic opportunities for allied sectors.

The Budget also appreciated the underleveraged potential of Odisha’s tourism industry by supporting the state’s rich heritage-history, spirituality, craftsmanship and natural beauty.

Recognizing the high potential domestic cruise segment, the Union Budget announcement proposed a simpler tax regime to support/incentivize foreign cruise companies operating in India’s waters.

We’re optimistic about the significant allocation of INR 11.11 lakh crore (constituting 3.4% of India’s GDP) towards infrastructure development. The development of road, rail, air, and waterways will ensure a boost to access/connectivity and affordability, and force multiplier benefits for tourism and allied sectors.

When introduced, TCS was considered disadvantageous to salaried employees as their cash flows were negatively impacted. Post the Budget announcement, salaried employees can now avail of immediate credit of TCS paid on account of their foreign travel – against TDS on salary, enhancing the purchasing power of Indian consumers.

The discontinued SEIS scheme should have been reinstated, as this is meaningful towards encouraging inbound tourism, foreign exchange receipts and a force multiplier for employment generation.

We are disappointed to note that key pillars in India’s Tourism agenda – Aviation & Hospitality were not mentioned as part of the Budget and both standardisation of GST rates on hotel tariffs to 12% and the reduction of ATF remained unaddressed.

Rajesh Magow, Co-Founder & Group CEO, MakeMyTrip
The government’s continued emphasis on infrastructure development is commendable. Enhanced road infrastructure will bolster the travel and tourism sector. We also welcome the initiatives to develop iconic spiritual and cultural sites into world class tourist hotspots.

The decision to reduce the TDS rate on e-commerce operators to 0.1% is a welcome move. Furthermore, the provision of credit for TCS against income tax under ‘Income from Salaries’ is logical and will provide much desired relief to taxpayers who travel internationally.

Chirag Agrawal, Co-Founder, TravClan
The Finance Minister’s proposals to develop tourism corridors at Vishnupad Temple and Mahabodhi Temple, along with support for Nalanda as a tourist hub, represent a positive leap towards enhancing India’s tourism infrastructure. These initiatives could stimulate local economies and attract more visitors, promising substantial growth for the travel and tourism sector.

At TravClan, we believe that integrating these developments with advanced technology is crucial. Incorporating digital tools for better visitor management and promoting seamless travel solutions could significantly enhance their impact.

While the focus on Odisha’s tourism is commendable, a more comprehensive strategy that leverages technology to address the needs of modern travel agents and improve domestic tourism efficiency would be even more beneficial. The economic policy framework for next-generation reforms is a step in the right direction, but practical implementations will be key to fully realising these goals.

Overall, the budget shows great promise for the tourism sector, and adopting innovative solutions could amplify benefits and drive sustainable growth in the industry

Aditya Sanghi, CEO & Co-Founder, Hotelogix
The 2024 budget introduces impactful initiatives for the tourism sector, poised to enhance India’s global appeal as a tourist destination significantly. The government’s decision to promote Nalanda and Orissa, along with the focus on religious tourism, reflects a strategic and holistic approach that will drive economic growth and showcase India’s rich heritage.

Jyoti Mayal, President, Travel Agents Association of India

The main concern raised by TAAI was on the abolishment of TCS on outbound travel which is hindering the ease of doing business for Indian Travel Agents / Tour Operators and increasing the competition with global players from overseas not levying GST or TCS to the passengers. Inbound and Outbound Tourism go hand in hand and to increase inbound, outbound tourism too must increase. TCS puts a spoke in the outbound tourism traffic as the travellers funds are blocked.

We have been reiterating to the Government of India to place the Travel and Tourism Trade, specifically the travel agents and tour operators in the concurrent list and provide rebates to the trade as a result grant industry status.

Missed Opportunities in Promoting Domestic Tourism: The budget falls short in launching robust campaigns to boost domestic tourism, which has become increasingly crucial in the current global context. Promoting local travel can drive immediate economic benefits and foster a culture of exploring India’s diverse attractions.

In conclusion, the financial budget presented by the Finance Minister has significant gaps that could hinder the growth and recovery of the travel and tourism sector. Addressing these issues with a more comprehensive and supportive approach is crucial for unlocking the full potential of India’s tourism industry and ensuring its sustainable development.

 

Tourism gets boost with INR 2,080cr for infrastructure development in Budget outlay

The Union Budget 2024-25 has allocated INR 2,080 crore for tourism infrastructure development, a significant increase from the revised outlay of INR 1,294 crore in 2023-24.

The tourism sector has also received a 3.3% higher capital expenditure push of INR 2,479.62 crore for the financial year 2024-25, up from the INR 2,400 crore allocated in the previous Budget. The revised budget outlay for tourism stood at INR 1,692.10 crore.

“Tourism has always been a part of our civilization. Our efforts to position India as a global tourist destination will also create jobs, stimulate investment, and unlock economic opportunities for other sectors,” stated Union Finance Minister Nirmala Sitharaman while announcing the Budget.

After highlighting tourism as one of the four transformative opportunities for inclusive growth during the Amrit Kaal in the Union Budget 2023-24, the government has rolled out more initiatives to support the sector

ACI World, Airbus ink deal for reducing aviation impact on environment

Airports Council International (ACI) World and Airbus have signed a cooperation agreement to support the industry’s efforts to reduce the environmental impact of aviation.

This partnership leverages the strengths of the world’s leading aircraft manufacturer and the largest international association of airports to make significant progress in both decarbonising aviation and mitigating aircraft noise impact.

This alliance will address key areas including Sustainable Aviation Fuels (SAF), hydrogen technologies, advanced air mobility, operations efficiency, and aircraft noise management practices. It will foster the exchange of information and perspectives on low carbon operations, communicate industry progress, jointly develop guidance materials, and potentially formulate unified positions on policies and standards to achieve the industry targets.

Luis Felipe de Oliveira, Director General and CEO, ACI World, said, “ACI World and Airbus’ ground-breaking cooperation agreement marks a pivotal step in our journey towards a net-zero carbon aviation industry. This strategic alliance underscores the unwavering commitment of airports worldwide to sustainable aviation, ensuring that we not only reduce our environmental impact but also maximise the socio-economic benefits of air travel. By focusing on key areas such as Sustainable Aviation Fuels, hydrogen technologies, advanced air mobility, operational efficiency, and aircraft noise management, we are setting new benchmarks for sustainability in aviation, and paving the way for a greener future.”

“This partnership marks a significant step in our collective efforts to reduce aviation’s environmental impact,” said Julie Kitcher, Airbus Chief Sustainability Officer. “By combining our technological expertise with ACI World’s vast network and operational insights, we aim to influence policies and standards that support sustainable aviation and drive industry-wide innovation. Together, we can create a cohesive and aligned approach to achieving our decarbonisation targets and enhancing the sustainability of the global aviation sector.”

This collaboration builds on the successful partnership between Airbus and ACI EUROPE, which began two years ago and which has significantly strengthened the relationship by working together on the deployment of alternative energies including hydrogen and SAF within European alliances, sharing technical data with European airports and communicating progress at key industry events. The expansion of this collaboration to a global scale underscores the importance of integrated efforts between aircraft manufacturers and airport operators on a global scale.

FM lays emphasis on developing religious sites in Budget speech

The Union Budget announced by Nirmala Sitharaman saw major thrust on developing newer destinations and circuits, while continuing to innovate. Development of temples and sites of relgious importance formed the cortnerstone of her speech for the travel & tourism sector.

Some of the initiatives announced incude:

  1. Development of Vishnupad Temple Corridor and Mahabodhi
  2. Temple Corridor modelled on Kashi Vishwanath Temple Corridor
  3. Comprehensive development initiative for Rajgir will be undertaken which holds religious significance for Hindus, Buddhists and Jains.
  4. The development of Nalanda as a tourist centre besides reviving Nalanda University to its glorious stature.
  5. Assistance to development of Odisha’s scenic beauty, temples, monuments, craftsmanship, wildlife sanctuaries, natural landscapes and pristine beaches making it an ultimate tourism destination.

EaseMyTrip opens office in Gurugram

EaseMyTrip.com has opened its new office in Gurugram, Haryana. This strategic move highlights a key milestone in the brand’s expansion journey.

Located in the prime region of Institutional Area, Sector 32, Gurugram, the new office resonates with EaseMyTrip’s commitment to its customers for offering exceptional services. The new office will support the company’s integral operations.

Nishant Pitti, CEO & Co-founder of EaseMyTrip, said, “We are thrilled to open doors to a new office in the Millennium City of India, Gurugram. This is an opportunity for us to expand our presence. We welcome talent from all walks of life to join our company and support us in our larger vision of transforming the travel and tourism industry with our high-end offerings and exceptional team.”

With offices in Delhi, Mumbai, Bengaluru, and Noida, EaseMyTrip has a strong presence across the country. The brand also has a significant overseas presence with offices (as subsidiary companies) in the Philippines, Singapore, Thailand, the USA, London, New Zealand, and the UAE. The new office in Gurugram is part of its larger vision to expand its footprints and bridge the market gaps with its travel booking services.

 

Foreign tourists can now make payments in India via UPI One World

Travelling in India just became easier for foreign visitors with the introduction of UPI One World, a digital wallet designed to enhance convenience and security. This innovative payment solution allows tourists from any country to explore India without the need for cash or complex foreign exchange transactions.

Initially launched during last year’s G20 summit hosted by India, the UPI One World wallet is now accessible to visitors from a broader range of countries. Tourists can use the app to make payments at merchant locations by simply scanning QR codes, ensuring a hassle-free experience. Unused balances can be transferred back to the original payment source in accordance with foreign exchange regulations, thanks to the collaborative efforts of NPCI (National Payments Corporation of India), IDFC First Bank, and Transcorp International Limited, under the guidance of the Reserve Bank of India.

Available through authorised PPI issuers at airports, hotels, designated money exchange locations, and other key touchpoints, the UPI One World wallet requires a full KYC process based on a passport and valid visa. Special arrangements are also being made to provide these wallets at Bharat Mandapam in New Delhi, the venue for the World Heritage Committee meeting, benefiting the delegates. Once issued, the wallet can be loaded with cash or through other payment methods.

Foreign visitors no longer need to carry cash or worry about foreign exchange issues. The UPI One World app facilitates easy payments at shops and restaurants via QR code scanning. This service, previously limited to G20 countries, is now open to all international travelers visiting India.

Delegates attending the World Heritage Committee meeting in New Delhi from July 21-31, 2024, can also utilize UPI One World, with special provisions in place for wallet acquisition at the venue.

The UPI One World wallet, available from authorized providers at airports, hotels, and money exchange locations, follows a secure verification process to ensure user peace of mind. Tourists can load the wallet with cash or other payment methods, and transfer any remaining funds back to the original payment source upon departure from India, following foreign exchange regulations.

This initiative aims to streamline travel in India for international visitors, offering the convenience and security of UPI, India’s renowned digital payment system. Tourists can now focus on enjoying their trip without the concerns of managing cash or currency exchange.