By Neeraj Kaushal

If millions of Indians simply went on vacations, visiting domestic tourist destinations, would that energise India’s slowing economy? Could the economy bounce back not because people were working harder, but because they decided to take a break from work and instead went on a ‘Char-Dham Yatra’?

Believe it or not, the answer to both questions is yes. We increase our incomes by working overtime. We contribute to the nation’s GDP by also spending what we earn.

The contribution of domestic tourists and tourism to the Indian economy has remained largely unsung. Domestic tourist visits have been growing at an astonishing pace in recent decades. In 2000, there were 220 million domestic tourist visits. The number has grown almost nine-fold to 1.82 billion in 2018. A substantial proportion of this is religious tourism. But whether you spend on a pilgrimage to Kedarnath or skiing in Kufri, it all adds to the same GDP.

Tourist’s Own Country

Foreign tourist arrivals have also grown, but by a much modest proportion in comparison: from six million in 2000 to 24.7 million in 2016. While a typical foreign tourist spends much more than a domestic tourist, the sheer volume of domestic tourism points to its enormous contribution. Between 2011 and 2016, the number of domestic tourist visits almost doubled from 865 million to 1.61 billion. Foreign tourists arrivals increased by only a quarter from 20 million to 25 million during this period.

As an aside: economist and former chief economic adviser to the ministry of finance Arvind Subramanian used foreign tourist arrivals as a factor in his
Harvard paper on GDP ‘misestimates’. I wonder if his GDP estimates would be higher had he used domestic tourists arrivals.

READ  India bags four bronze Cannes Lions

In an earlier Economic Survey, Subramanian documented internal travels to be vastly greater than what was known from survey data — which also points towards increased GDP growth, even though traditional indicators related to manufacturing do not suggest 7% growth.

Back to domestic tourism, in his Independence Day speech from the Red Fort in Delhi, Prime Minister Narendra Modi asked his countrywomen and men to travel to 15 tourist destinations within India by 2022 and energise domestic tourism. A good call, yet a tall order. A good call because tourism is a highly labour-intensive industry. A substantial amount of money spent on tourism will go directly into creating jobs and raising incomes. A tall order because Modi wants us to make five trips a year, up from 1.5 in 2018. Even if 20% of Indians listen to Modi, it will double domestic tourist visits.

Travel for tourism is a luxury. It is one of those things you do only if you can afford it. People rarely borrow to go on vacations as they often do to build or renovate homes or finance education.

In household budgets, tourism-related expenditure is consumption, and not investment — even though a growing body of research shows vacations improve productivity, increase creativity, reduce stress and improve mental health.

Attitudes towards vacations differ across nations. Continental Europe takes the notion that vacations reduce stress, improve physical and mental health and increase productivity very seriously. So, vacation days are mandatory. In many European countries, businesses simply close for a full month in July or August when their employees go away on vacations. In overworked US, according to a 2019 US Travel Association-Oxford Economics-Ipsos
study, unused vacations cost businesses $151.5 billion a year.

READ  22 Kymco to set up new plant for two-wheelers in Bhiwadi

Of History & Geography

Despite the astounding growth, Indian tourism has a substantial untapped potential. The question remains: why, despite India’s rich heritage, diversity of cultures, exotic cuisines and long history of civilisation, do we get such a small pie of global tourists and tourism revenue? The World Economic Forum’s 2017
Travel and Tourism Competitiveness Index, provides some answers.

Out of a groups of 136 countries, India ranked 40th in the tourism competitiveness index, 55th in international openness, 112th in information and communication technology readiness, 110th in tourist service infrastructure, 114th in safety and security, 104th in health and hygiene, and 89th in business environment. Tourism has not been a high priority in India. WEF ranked India 104th in prioritisation of travel and tourism.

On the positive side, the potential for increasing tourism is immense.

India is ranked 10th in price competitiveness, ninth in cultural resources and 24th in natural resources, and sixth in Unesco’s world heritage sites.

But, for now, countries that are much behind India in price competitiveness and cultural and natural resources are much ahead in domestic and foreign tourism.

There are so many Indian historical sites that have not even been excavated.

And then there are those that exist but it is just impossible to get there. The real problem is the sole responsibility of restoring them and that falls on the Archeological Survey of India (ASI). Because ASI has no funds, these monuments are simply left to decay. The Agha Khan Foundation and Tata Trust, in collaboration with ASI, have done outstanding restoration of many monuments, including Humayun’s Tomb in Delhi. But such initiatives need to be expanded hugely.

READ  Government mulls additional Rs 30,000 crore capital infusion in PSU banks

The writer is professor, social policy, Columbia University, US





READ SOURCE

WHAT YOUR THOUGHTS

Please enter your comment!
Please enter your name here