Tourism in Modi 3.0

As the new Government gets down to working on the vision of a developed India, the tourism industry has much to be optimistic about. First, continuing his constant acknowledgement of the role of tourism as a pillar of development, the Prime Minister Narendra Modi has, in his very first speech after the election mandate, elaborated on the potential contribution of tourism in making a developed India again. Second, his selection of the tourism ministers, both Cabinet and MoS, from the two tourism prominent states, conveys a strong message that tourism will be managed by people who are sensitive to its nuances.

In fact, the budget of 2023 had laid down the strategies to steer tourism. The roadmap charted in the budget was simple and pragmatic - Tourism must be developed in a mission mode with clear goals and accountable action plans. It must ensure the convergence of all the stakeholders in the Government and should be built on strong public private partnership. 

The Ministry has no time to lose to build on this structure. The first step should be to assess the potential, decide on the goals for 2047, identify the infrastructure and other requirements to achieve the goals, assess the gaps and take action to fill them.

The first requirement is to refurbish many hitherto not known destinations. Unless it is done, the expected tourist footfalls will make tourism unsustainable. The Government had planned to develop 50 new destinations. While it is a good beginning, this can’t be a static goal. There is a contradiction in tourism development in India. While it is recognised that tourism can promote inclusive growth, more than 50 per cent of the arrivals and earnings are confined to 5/6 states. Every state therefore must take the lead in the professional development of new destinations. The Draft Tourism Policy of 2021 had laid out the components of a professional destination development harmonizing a decent accommodation, hassle free connectivity, shopping, culture, sightseeing and storytelling – creating an ‘experience’.

Two other crucial components of the future vision would be accommodation and connectivity. By all accounts, even now there is a mismatch between demand and supply in accommodation. There is a time lag in creating accommodation. As tourism grows and as the economy grows enabling more Indians to travel internally, the gap will only increase. It will have an adverse impact on price and resultant erosion in image and competitiveness internationally. Bridging the gap is possible under Atmanirbhar Bharat - Indian hospitality industry can make the investments with a little support and handholding, tweaking the infrastructure status rules pragmatically and a supportive land policy. 

Assuming that we need one lakh rooms over this period and assuming that per room key the investment is Rs 2 crore, it will be a staggering amount of Rs 2 lakh crore. One old MoT estimate 1983-84 found that investment of Rs 10 lakh in hotels and restaurants can create 89 job opportunities. Even if that investment requirement for creating the same number of jobs goes up by 10-15 times now, the total jobs created in the economy by such investments as mentioned above will be enormous. In addition, the multiplier effects of such hug investments in far-flung areas of the country will be far-reaching.

Connectivity will, of course, be of pivotal importance. Fortunately, a harmonised connectivity plan under Gati Shakti is now operational. The proposed convergence of government departments should ensure that the tourism destination development plans are aligned with Gati Shakti plans or better still if it takes into account the destination developments planned by the Government. Similarly, the effectiveness of the Udaan scheme and its capability to connect destinations within the country will be a deciding factor in development of new destinations, particularly in the Northeast.

But there are hurdles aplenty. The “ease of doing business” is often uneasy. There are some laws, rules and procedures like the century-and-a-half-old Sarais’ Act which are obsolete. There are many which do not gel with the idea of Viksit Bharat. The hospitality industry requires 49 Pre-Construction Licenses / Approvals which take 61 days on average and 27 Pre-Opening Licenses which take 50 days on average. In recent times, the Government has weeded out many outdated laws and rules. The MoT should also set up a high-powered committee to see how to rationalise these licenses and approvals.

Many of the rules and procedures vary from state to state. Sometimes, the state procedures conflict with the Centre. “Tourism” as a subject is not in the Concurrent list and that poses technical problem of enforcement of a harmonised procedure. Yet MoT can prepare a Template of Best Practices  for ease of doing business and harmonised rules and procedures for licenses and approvals and persuade the states to adopt the same. 

The Government has announced a 100-day target of “things to do”. But 100 is just a number. Fixing a goal and a target to review fits in with the Mission Mode approach to governance. The issues mentioned above need urgent attention. The MoT should carry forward PM’s vision on tourism by including some of these action points in the 100-day priority list.