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EMERGING SOURCE MARKETS BOOST INDIA’S INBOUND SECTOR

The growth in India’s inbound tourism has always been gauged by Foreign Tourist Arrival (FTA) numbers. A new trend that can be seen getting chalked out in 2013 is the growing number of emerging source markets for the country. While UK, Europe and USA started losing out on tourism as a result of the rise in the US$ rate, India gained from the dip in the Rupee value. The economic downturn meant that India became a more financially viable country for tourists to visit than the conventional destinations.

Not to say that the Indian inbound sector did not face its challenges last year. According to Arjun Sharma, Managing Director, Le Passage to India, there were periods of good numbers followed by absolutely flat growth. “Difficult economic environment as well as poor publicity of India at a global level slowed the tourism progress considerably. Moreover, some markets did very well while some did not. Overall it was a year where we produced flat growth. The fall of the Rupee against other currencies helped in the overall result,” he opined.

An additional boost to the inbound numbers came through India’s Visa-on-Arrival (VoA) scheme for select countries. The number of VoAs issued under the Scheme during 2013 was Japan (6,448), New Zealand (3,968), the Philippines (2,967), Indonesia (2,758), Singapore (2,486), Finland (1,030), Vietnam (205), Myanmar (148), Luxembourg (145), Cambodia (120) and Laos (19).

Furthermore, the Ministry of Tourism (MoT) named five additional airports gateways to the country by allowing them the authority to stamp Tourist Visas on Arrival (TVoA) - Goa, Hyderabad, Thiruvananthapuram, Kochi, and Bengaluru. Reaping the benefit, during 2013, the highest number of VoAs were issued at New Delhi airport followed by Mumbai, Chennai, Kolkata, Bengaluru, Kochi, Hyderabad  and Trivandrum. These statistics meant that the footfall from newer markets was undoubtedly increasing.

Speaking about the downslide of traditional source markets, Subhash Goyal, President, Indian Association of Tour Operators (IATO) and Chairman, STIC Travel Group, said they have been stagnated. “Movements are very slow and traffic is not round the year as it used to be. Even the air cost to travel to these countries has gone up. But up market traffic continued to give numbers. It was USA which contributed maximum with 1,040 million with a share of 16 per cent in over all tourist arrivals in 2013. Of course, we explored new markets last year and had series of Road Shows with the support of MoT to reach these markets. These are South Korea, China, Japan, Finland, Austria, CIS countries and the Golf and Middle East, South Africa and of course for Buddhist traffic Myanmar, Vietnam, Laos etc,” he said.

Echoing his views, Sharma stated that traditional markets have shown average performance with countries such as France and UK showing growth and Markets such as Italy and Germany slowing down. Far East on the one hand slowed down while Australia on the other hand showed some recovery. Apart from traditional source markets, new markets that are showing promise are countries of the Latin America, North America and Japan,” he added.

Arup Sen, Director, Special Projects, Cox & Kings opined that traditional source markets such as UK, USA, France and Germany have recorded growth, but India needs more long-staying guests that will help in the growth of inbound tourism.

Giving a positive take on the scenario, Surinder Singh Sodhi – Senior Vice President & Head, Leisure Travel (Inbound), Thomas Cook (India) Ltd (TCIL) opined that the decline of the Indian rupee meant that India had transformed into a destination that offered immense value for money to the foreign traveller. As a result, inbound tourism witnessed a boom, and traditional source markets such as the UK & France did exceptionally well, he revealed.

Speaking about the challenges that have deterred the growth of India as a strong destination for international travellers, Sharma opined that the two most critical issues that are decelerating tourism growth in the country are irrational visa regulations and safety concerns for women travellers. “India with all its exotic wonders competes with destinations that offer similar experiences are perceived to be more tourist-friendly. Our neighbours such as Sri Lanka have extremely simple, user friendly and cost effective e-visa procedure. Indian authorities must dispense with the reciprocity regime and look at tourism as an economic enterprise and not an elitist whim,” he said.

Addressing this very concern is the Ministry of Tourism’s move to extend the VoA scheme to another 40 countries to encourage more footfall from emerging source markets as well as established ones. Goyal stated that there is no other way as visa has become the major bottleneck area and both overseas tour operators and individual tourists are avoiding India because of the uncertainty in getting visa and the cumbersome process involved. “Even if they don’t give VoA from 40 countries let them give this facility for those countries from where the “THREAT” perception is not there like Benelux countries, Scandinavian countries and Nordic countries, France, Germany, Austrian, Switzerland, Australia, South Korea etc and that will really boost tourist arrivals immediately,” he added.

Hector D’Souza, L’Orient Travels called the VoA scheme brilliant, adding that it should, however, be backed with increasing flight connectivity and more direct flight connections. “Existenssial issues within our country have a direct influence on arrival numbers - some of them need mentioning - excessive traffic congestion in tier - I cities. Attacks and incidents of misbehaviour with woman tourists is another factor. It’s important for perceptions/expectations to match experiences. Whenever there is a mismatch numbers will vary,” he commented.

Another factor they unanimously agreed on was their outlook for 2014. D’Souza believes that expecting a year on year growth of between 8-12 per cent is perfect. “The strong trends are more likely to see are increase in ethnic travel, India becoming a weekend destination (subject to more turnaround flights being introduced) and experiential travel showing further increase,” he opined.

Sodhi revealed that an emerging trend is a noticeable shift from traditional destinations towards exploring off beat locales like the North East, Kashmir, Gujarat, Punjab and Shimla. Experiential travel such as volunteerism, river cruising, eco tourism will see unique interest, he added.

“Even if we can reach 10 per cent, we will be happy but our target is 15 per cent definitely and we are working on that objective. Even World Tourism Organization is hoping to reach Double Digit growth. But we should as we remain a very positive and affordable destination for tourists for all budgets, all reasons and all seasons. We will make it “HAPPEN in 2014” and India will be one of the choicest destinations for holiday-goers from overseas,” Goyal concluded.

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