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The Magazine On The Business Of Travel. Like It?
Sumesh Patel, President, Asia Pacific, SITA, shares his views on how technology is becoming the great enabler for airlines and airports to offer safe and seamless travel
Air travel is being reshaped as COVID-19 is impacting all aspects of our industry and challenging our established ways of working. Now more than ever, airlines and airports must adopt a relentless digital shift in passenger service, core operations and stakeholder collaboration – making flying safer, more efficient and hassle-free. Excerpts from the interview:
How would you explain the impact of COVID -19 on airline and airport industry in APAC?
The COVID-19 pandemic has also refocused IT spending priorities for airlines and airports as revenue plunged and the industry faced new health and operational requirements needed to keep flying. The industry has to achieve far more with far less in order to thrive in a significantly smaller market where passenger numbers may be uncertain for years to come.
We need a focus shift from immediate actions like masks and hand sanitizers to longer-term and more sustainable solutions. Automation of operations will play an important role in reducing queues and touchpoints at the airport as passenger volumes begin to recover and social distancing becomes increasingly difficult.
How do you see the present and future of the Indian aviation industry?
Mumbai’s Chhatrapati Shivaji Maharaj International Airport is a good example of the above changing trends in the Indian aviation industry. The airport introduced nearly 50 mobile-enabled kiosks, becoming one of the first airports in India to deliver a completely contactless way for passengers to check-in for their flight. The technology allows passengers to use their mobile device to interact with kiosks. This significantly reduces the need to touch surfaces in the airport and meets the Ministry of Civil Aviation’s (MoCA’s) new passenger processing guidelines aimed at reducing the risk of spreading COVID-19 infections.
What technology trends will transform the air travel post COVID-19?
A strategic technological transformation is critical for the future of the air transport industry. But to work, the industry and its stakeholders must collaborate at all levels. Going forward, technology will continue to be the mainstay for airlines and airports to adapt to the fast-changing regulations, scenarios, and restore passenger’s confidence in flying. The acceleration of digitization, automation, and the passenger experience will remain high on the agenda in a post-COVID world. Now, more than ever, the industry needs to work towards the vision of an entirely mobile-enabled journey to keep passengers informed and moving, while ensuring safety. This is especially so in the area of ‘touchless’ technologies, such as mobile and self-service biometrics.
Infrastructure can be based on new generation cloud-based platforms that are flexible, agile, scalable, and far more cost-effective than earlier infrastructures. Biometrics and digital identity management will be fundamental capabilities in this touchless journey. They will enable greater automation, accuracy, and efficiencies for both the air transport industry and its customers. Their advantage is that they can be used on and off site, so we’ll start seeing more check-in outside of airports.
SITA has come out with many innovative technologies for airport’s operation to offer safe travel. Can you throw some light on new technologies?
We are currently working with airlines, airports, governments, ground handlers, and other organizations across the world to rapidly roll out new solutions that address the challenges of the current times. We are collaborating with industry partners to assist them in leveraging existing infrastructure and systems to adapt to a post-COVID-19 environment and support an economically viable return to the skies.
We have introduced solutions that allow passengers to use their mobile device as a remote control for touchpoints such as self-bag drop and check-in kiosks, removing the need to touch any airport equipment. SITA is delivering ‘Your face is your boarding pass’, using biometrics and mobile technologies, thanks to SITA Smart Path.
Importantly, we support automatic biometric boarding gates and ‘face pods’, reducing the need for physical contact and allowing the boarding process to be controlled to avoid clustering. In addition, SITA is making its biometrics ‘mask aware’, and at kiosks, bag drops and face pods we are integrating temperature sensing into the touchpoint workflow.
For the airports that are not equipped with the native mobile platform, we are using technology to remotely control self-service devices such as kiosks with a mobile phone, removing the need to touch any airport equipment.
How these technologies contributed to instill confidence among travellers?
The pandemic increased the drive for greater operational and cost efficiencies and a focus on sustainability and health. There is a lot of industry innovation occurring, using facial biometrics, in response to the pandemic. These technologies are playing a pivotal role in enabling seamless travel experience while also restoring the passenger’s confidence in flying. Contactless, self-service technologies at every step are facilitating passenger flow and cutting queues thereby ensuring a social distancing-friendly passenger experience. With an initial reluctance to touch surfaces and interact with agents, passengers are becoming more confident with the increased use of their smartphones in the air travel process. Apps are being used to check in bags using mobile bar codes, navigate through airports, and even interact with the cabin crew.
How do you see the response of Indian aviation industry regarding adoption of technology?
Some of the major airports in India are greatly advanced when it comes to automation, security screening, and baggage handling technologies. SITA has deployed its next-generation Airport Management solution (AMS), a suite of integrated software applications designed to support and enhance airport operations, across twelve AAI airports in addition to Bangalore International Airport, Chandigarh International Airport, Cochin International Airport, Kannur Airport, and; Nagpur (MIHAN) Airport.
Being a trusted IT partner to the Indian air transport industry, we are working towards bringing the QR enabled contactless check-in system to these other airports too. The pandemic has only accelerated the adoption of technologies such as biometrics, artificial intelligence, machine learning, etc. in these airports to provide a connected and enhanced digital experience to air travelers.
The successive waves of COVID-19 have totally devastated the global travel and tourism industry and India bore the brunt with two waves already over and the threat of the third looming over. The green shoots that started appearing post the first wave completely disappeared with the arrival of the second wave. The slow recovery recorded in the first quarter, 2021, diminished and the situation became dire during the second wave when localized lockdowns and restrictions imposed by various state governments crippled the tourism industry. The second wave was even more virulent and hit the young and the urban class with people scrambling for oxygen. The pandemic forced many industries to adapt to new models of doing business by adopting online strategies. However, tourism is about moving out and visiting places and this cannot be done virtually.
According to UNCTAD and UNWTO report, the crash in international tourism due to the coronavirus pandemic could cause a loss of more than US $ 4 trillion to the global GDP for the years 2020 and 2021. The report says international tourism and its closely linked sectors suffered an estimated loss of US $ 2.4 trillion in 2020 due to the direct and indirect impact of a steep drop in international tourist arrivals. A similar loss is expected this year, the report warns, noting that the tourism sector’s recovery will largely depend on the uptake of COVID-19 vaccines globally. According to the report, the reduction in tourism causes a 5.5% rise in unemployment of unskilled labour on an average, with a high variance of 0% to 15%, depending on the importance of tourism for the economy.
The World Bank, in its latest report, slashed India's GDP forecast to 8.3 per cent for FY22 as against its earlier estimate of 10.1 per cent. It has further projected India's growth to be 7.5 per cent in 2022.
The UNWTO states that destinations around the world welcomed 180 million fewer international arrivals during January - March 2021 compared to the first quarter of last year. Asia and the Pacific continued to suffer the lowest levels of activity with a 94 per cent drop in international arrivals over the three months. In India, the number of foreign tourist arrivals dipped from 12 lakh in December 2019 to 470 in April 2020. Even though India and other countries gradually opened their borders after the first wave, only 80,000 foreign arrivals were recorded in December 2020.
The hospitality sector is the worst hit within the industry due to its nature. “The sudden onset of the second wave has left the hospitality sector again reeling under the impact of the crisis as travel restrictions and curfew continue to pose challenges for leisure and business travellers. All the major tourist destinations are facing the brunt of extended curfews and lockdowns. The preliminary indications are that approximately 40% of small scale hotels have shut operations across the country while large numbers of others are looking at a possible collapse if no respite is offered in the coming months,” Madan Prasad Bezbaruah, Secretary-General, Hotel Association of India (HAI), said.
Gurbaxish Singh Kohli, Vice President, Federation of Hotel & Restaurant Associations of India (FHRAI), says that the impact is highly devastating. “As per our last estimates, the industry has been impacted by Rs. 1.40 lakh crores and this is the fiscal impact. The lakhs of jobs lost with 40% establishments shut down permanently compounds the fiscal impact.’’
On the international front, Rajiv Mehra, President of the Indian Association of Tour Operators (IATO), says that the inbound tourism impact on the economy during the last financial year till 31st March 2021 was almost 95%. “This means a loss of almost US$ 27 billion, almost Rs 2 lakh crores on a direct basis. On an indirect economic basis, the loss is over Rs 6 lakh crores. The domestic tourism market has an impact of almost 60% to 70% of the total value. This implies almost Rs 2.5 to 3 lakh crores of direct domestic tourism loss. On an indirect basis, the economic impact is almost Rs 6 to 9 lakh crores,” Mehra says and adds that impact on job losses of almost 3.5 crores.
Jyoti Mayal, president, Travel Agents Association of India (TAAI), feels that the devastating second wave has impacted everyone. “We have all lost family, friend, colleague, or an acquaintance. Businesses that had slowly restarted crashed and the industry is truly struggling with revenue and cash flow. We are now paranoid, and it will certainly take us a while to gain total confidence to move out as in the pre covid era and vaccination will truly be the driver. We must realise that domestic tourism as drive cations would revive much quicker at selected sustainable destinations, but other travel is more of friends and family, urgent business-related or unavoidable travel. It’s not normal tourism travel,” Mayal says.
PP Khanna, President, Association of Domestic Tour Operators of India (ADTOI), opines the impact has been more during the second wave as shortage of oxygen cylinders, beds in the hospitals and other infrastructure facilities have kept everyone guessing for the safety first and there has not been much movement of tourists due to lockdown clamped by states.
“The second wave of the pandemic hit the travel, tourism, aviation and the hospitality industries sharply. The travel and tourism industry-related services were affected- passenger traffic, air cargo demand, airport workforce, and incoming revenues. Foreign countries banned the entry of Indians. The economic recovery downed, and the flexibility in spending on luxury has declined drastically due to rising unemployment and worries about likely job losses in the future,” Biji Eapen, National President, IATA Agents Association of India (IAAI), said.
Despite the setback, industry associations think that the industry will bounce back quickly. “The industry has the inner strength and core competence to revive its primary position in the tourism and hospitality sector and as the little lull period before the second wave showed it can bounce back quickly. But the devastation has been too deep and extensive, and it requires the helping hand of the government to find its feet,” Bezbaruah opines. He adds that the situation will ease with faster vaccination drives and herd immunity. He highlights that the recent announcements like increasing the size of the Emergency Credit Line Guarantee Scheme (ECLGS) from Rs. 3 lakh crores to Rs. 4.5 lakh crore, liquidity support by the Reserve Bank of India and tax exemptions given by some state governments, are some of the measures that will help the sector gain confidence towards recovery.
Mayal echoes similar sentiments. “I am very confident travel and tourism will revive with new opportunities, new zeal and a new outlook. We need to adopt the new protocols and procedures. Consumers will want more information about their end-to-end journey. We’ll start to embrace travel more consciously, seeking out smaller brands, hotels and experiences that reconnect us with nature and minimise our footprint. Short stays and weekend trips will be huge,” Mayal says adding that travellers will have a greater desire to seek out less crowded attractions and destinations, as well as nature-based experiences.
Mehra feels that reassurance and confidence-building measures need to be put in place during the revival phase. “Vaccination is the key. All our front-line tourism workers must be 100% vaccinated to be ready for the tourism activities. There is a need to create awareness on clean and hygienic tourist locations,” he says and suggests that the e-Tourist Visa/International flight operation should start from October 2021, if the situation remains under control. “Open up domestic tourism as soon as possible where the number of Covid cases has reduced drastically without any restriction. This will help build confidence among foreign tourists to visit India. All-State Governments should promote information on Covid 19 free destinations.’’ Mehra adds.
Eapen feels that natural recovery is possible only when international tourism resumes which needs globally coordinated, risk-based solutions in a phased manner. “We need travel recovery and have to start somewhere. Accelerating plans for digital health passports like Common Pass or IATA Travel Pass can be a vital tool in opening up travel once again. In addition, we have to see that all governments and airline operators will accept proof of vaccination as a condition for international travel,” Eapen suggests.
Kohli says that the revival is secondary. “We are yet in the survival mode. Only if one survives, one can revive. Restaurants if all goes well shall see revival within a year if all restrictions being abolished, whereas hotels will take another 3 years minimum to get back on track,” Kohli says.
Welcoming whatever fiscal support extended by the government, Presidents of the associations demand more financial support from the government.
While we appreciate the small piece-meal relief bits that have come in we expect a lot more hand-holding and stimulus, Kohli says. “For an industry that contributes to such a large extent to the GDP, employment and revenue of the govt we would expect no less. We have made representations to different arms of the govt and expect something soon, hopefully,” Kohli adds.
Mayal feels that the government must contribute to the industry’s benefit in challenging times. “When the travel, tourism and hospitality are struggling to stay afloat, why are we not considered for support such as monetary subsidies, statutory rebates and tax-free holidays. The lack of liquidity and continuous fixed costs are making it difficult for the industry to survive. We are an important sector & need to be reached out to by the government. The revival of travel and tourism will result in a reduction of unemployment, foreign exchange earnings and infrastructure development,” Mayal suggests.
Mehra says that the government’s decision to open a separate liquidity window of Rs15,000 crores with tenors of up to three years at the repo rate till March 31, 2022, will bring some succour to the tourism industry. He asks to release the SEIS Scrips for the year 2019-20 that has been kept on hold for over a year. “This is the legitimate demand of the sector as per provision in the foreign trade policy 2015-20,” he emphasises. He opines that ECLGS 3.0 announced on March 31, 2021, and the anomalies in the operational guidelines and FAQ issued by NCGTC has defeated the very purpose of the same. We urge the government to amend it suitably, he says.
Bezbaruah feels whatever support the government has extended will go a long way in bringing relief for the hospitality sector. “But much more needs to be done and that too quickly. We have explained that these relief measures are needed not because of the inefficiency of the industry but because the circumstances are beyond the competence of the industry and government support is justified by the lives and livelihoods in millions that will be saved in the process and the fillip that it will give to the economic recovery.
HAI has requested for stimulus package - subsidising of salaries of hotel employees by the government to 50% from April 2021-March 2022. “Many countries have provided this support to employees as part of their economic recovery programmes. In addition to this, infrastructure status to hotels will prove to be a tipping point of recovery and growth for the hospitality sector. It will also enable the sector to access long term funds at subsidized rates as available to other infrastructure industries such as airports, railways, ports etc. Infrastructure status will gravitate greater investments in the travel and hospitality sector around the country. In short, we have urged that tourism should be given the strength to become a pillar of development as the PM has often mentioned and a pragmatic sectoral recovery plan should be mooted,” Bezbaruah suggests.
Since the assistance offered by Central Government is limited to travel agencies having the Ministry of Tourism’s approval, the majority of travel agencies will not become eligible for availing of the help. “So, while appreciating the Central Government's initiative as a positive step, we at IAAI suggest extending the benefit to all IATA accredited travel agencies and travel and tour agencies approved by respective state governments in India to revive the tourism industry large,” Eapen says.
All these associations stood by their members in whatever possible way they could. These associations kept on sending information to keep their member informed and updated through various channels. They also used the lockdown period to upskill their members.
TAAI has been in the continuous process of motivating its members. “We conducted various webinars, organised meetings, updated all on travel and tourism-related issues, interacted with stakeholders, various educational programs on tourism & statutory compliances were conducted. We also have been able to help our members in getting refunds and booking through GDS,” Mayal informs.
Eapen says that IAAI’s stand on airline ticket refunding policy to save our valued customers was right, accepted and acknowledged by the Industry. Khanna says that ADTOI is in touch with its members regularly through zoom meetings, emails and this way taking association activities forward with their full support.
According to Mehra, IATO Covid Task Force formed with the members of the Executive Committee to guide and endeavour to help fellow members concerning medical consultation, medicines and hospitalization.
Due to our intervention through our regional arms, states like Gujarat, Karnataka, Chattisgarh, MP, Goa and Maharashtra have given reliefs in levy’s fees, statutory, and our representations to excise department and municipalities have got them a reprieve in taxes etc instead of the pandemic, Kohli informs.
Overall, there is the hope that if the government could assist in direct relief it will hasten the recovery process very soon.
Sandeep Dwivedi, COO, InterGlobe Technology Quotient shares his perspective about the future of travel and tourism industry post pandemic and the role of technology in the new normal
With second wave, the disruption has leveled up and so has the dependency on digital
The second wave of COVID 19 totally ruined the revival and survival of the industry. How do you see the future of travel and tourism industry in the country?
There is a push expected from the shock of the second wave. Many of the businesses in the first wave, when faced by the first blow of disruption, engaged in planning for a future in which pandemic posed a major part. With the second wave, there has entered an urgency in matters of executing those planned advancements. Naturally, declining economy and shock from loss of fellow comrades is distressful, however, with-it has risen the instincts of survival and agile approach among all commerce and industries. This will open doors to an evolved era of travel industry which will have safety measures as top priority at its core, in addition to personalization and digitization. Packed with more flexibility, the immediate future of travel will include empathetic offers from free date changes to discounted ancillary options and exclusive virtual and physical travel experiences collated to include state-tourism activities.
There was expectation that industry will be back on track in 2023 -24. It is delayed further. What is your take on this?
Indeed, the response across industry is still mixed. Speculation and anticipation has simulated many to acknowledge a slow but gradual recovery and 2023-24 still appears to be the latest timeframe for assured recovery. Between first and second wave, what the businesses have witnessed is not just an uneven development- elevating and declining at intervals, but also an interest in out-of-the-home activities- an interest that will likely pick up from extensive vaccination drives and more rigorous safety protocols.
What is in the store for the industry in next 2-3 years? What should be the way forward for big and SME players?
Leisure travelers will occupy a considerable space on the consumer pie-chart for travel industry in the next 3 years. Even in the face of previous crisis this class was first to recover taking nearly two years. So, targeting this segment and offering special collated packages to leisure travelers shall bring the much desired boost. Furthermore, exploring cross-sector collaborations to attract consumers and meet their demands shall help greatly. Local governments may prove a catalyst in recovering travel and tourism business for large and small-medium enterprises by becoming an active player in refining destination appeal, offering discounted activities, participating in tourism management and improving safety conditions.
Technology is going to play a major role post COVID in revival of the industry. What is your opinion on this?
Certainly, our dependency on technology is here to stay considering the interim, undying need for physical distances in the face of pandemic. Psychologically, this is molding consumer behavior and making them more prone to using technology for booking and managing travel, even experiencing travel. Furthermore, the ease of operations and management afforded by technology saves both time and money, making the experience swifter, simpler and cost-efficient.
Digitization is the way forward for the industry. We were talking about touchless, contactless services and facilities. What shifts are you noticing in digitization between two waves?
The key phrase we use here is ‘digital in disruption’. The more the disruption the better we fare on digital grounds, be it booking travel, managing it or experiencing it. With second wave, the disruption has leveled up and so has the dependency on digital. We are a witness to the new evolving trend – ‘phygital’, where digital at the young and affluent consumer level is steamrolled by physical at older, gen-x and less affluent consumer band. While this ferries on, there is evolution in operations at various touchpoints, including digital screening of passengers at airport, digital flight bookings via NDC, mobile apps for storing travelers COVID-19 negative reports and vaccine certificates, among other developments. In future, when ongoing advancements like robotic and AI assistance at various touchpoints becomes common sight, the exclusion of physical from phygital will be observed, somewhere towards the late twenty-twenties.
What is your opinion about business travel?
This segment is still volatile considering market conditions and vast dependency on work-from-home, especially amidst the recently elevated pandemic condition. Historical data further reinforces its slower recovery in the face of crisis and beyond it. It is only fair to say, we are expecting a phased recovery, depending in major parts on the employee’s willingness to travel, safety policies and government regulations. Between the recurring instances from corporates of maintaining a buffer of one to three months post government guidance to ensure safety and uncertainty of pandemic, business travel appears to be the segment last to recover.
What CSR activities you executed during this challenging times?
Our focus has been towards aiding the underprivileged who were impacted by COVID-19. To help them, our teams had contributed funds towards providing ration to the deprived families through Sai Baba Trust at Shirdi, donated stationary to vulnerable youth at Hope foundation and contributed towards PM Cares fund. We have also ensured our dear nature was not neglected while people of our nation were fighting COVID. Our teams came forward to plant trees at Tomb of Abdur Rahim Khan-i-Khanan, Delhi.
The lockdown due to COVID-19 impacted the hotel industry severely. Business were totally shut and hotels had to close its door. However, with drop in cases and availability of vaccines supported people’s desire to travel as part of the revenge tourism, Indian hotels are witnessing a gradual improvement in occupancies at pan-India level.
“There is a definite improvement which we have already started witnessing in our hotels. We are seeing occupancy improving to 30-35 per cent in most of our hotels. We expect occupancy to reach 50 to 60 per cent by end of the year,” Vilas Pawar, CEO, Choice Hotels India, said. He added that while occupancies are improving, the ARRs for the industry is stressed and it will take time to come back to the pre COVID level. “We used to command ARR of Rs 3500 in pre-COVID era across our hotels. The current ARR is Rs 2800,” he mentioned.
Replying to a question over the lower occupancies in hotels in metros, Pawar said that most of the companies across industry have adopted various cost cutting measures like reducing the office spaces, downsizing the team, restricting travel and others. He also mentioned that hotels having higher ARRs in metros are not getting good response from the market. While city hotels are stressed out, most of the resort hotels are performing better than earlier.
Commenting on the prospect for business travel to come back, the work from home culture is going to stay. “COVID -19 has made the company learn that the business can be run by curtailing travel. They have adopted virtual meetings. I think business travel will take a while to bounce back and it will not be at the pre-COVID level in the near future. And, this is a worrying point for the hotel industry,” Pawar opined.
He said that the industry reacted to the change induced by the pandemic by adopting various innovative measure to counter the impact. Hotels have adopted new SOPs to instill confidence among travelers. These SOPs are backed by technologies. “We had to reinvent ourselves. We had to cut down on staff, services and others. Adoption of health, safety and other security measures also increased the operating costs. We had to close few floors and rooms to cut the maintenance cost. The entire industry has faced severe situation,” he added.
On Choice Hotels India, he said that Choice Hotels India maintained its portfolio despite the lockdown. “We have currently 35 hotels in operation. We did not lose any hotel and kept on adding hotels in our portfolio. We opened 3 hotels in 2020 and are expecting to add 8-10 hotels in 2021. These hotels will be opened in Goa, Bodhgaya, Indore, Lucknow and other cities,” he revealed.
He said that like other hotels, Choice Hotels India is also adopting digital for marketing, promotion, and other brand building activities. “Our plan is to use social media and other digital platforms for expanding our reach in the market,” Pawar added.
In March last year, when destinations were gearing up for the peak summer months the pandemic related shut down dealt a body blow to tourism the world over. Destinations across the world scrambled for measures to save the industry. At first, they adopted a wait-and-watch situation. Thereafter, they soon realised that global travel will come to a standstill for some time to travel restrictions.
Many Indian states took a cue from PM Modi’s Atmanirbhar (self-reliant) campaign and focussed on the domestic market. They went back to the drawing board and drew up tourism policies primarily focussed on the domestic market.
States like Gujarat, Rajasthan, Andhra Pradesh, Karnataka, Goa and Jharkhand amongst others unveiled new tourism policies. Several other states/UTs such as Odisha, Bihar, Uttar Pradesh, Uttarakhand, Jammu & Kashmir, Ladakh, Punjab, Madhya Pradesh and others have adopted new policy initiatives in an attempt to revive and grow the tourism pie.
The measures adopted by states indicate that they are moving forward with initiatives to restart tourism and promote domestic demand. The establishment of health and sanitary protocols, emphasis on clean and safe practices, social distancing etc emerged as a crucial step to restore trust and confidence in the sector.
With domestic tourism gaining ground at the moment, marketing and promotional campaigns, product development initiatives and sops to improve infrastructure and special discounts begin to emerge in a few states.
New tourism policies
In January this year, Gujarat Chief Minister Vijay Rupani announced the state’s New Tourism Policy 2021-25 with a view to develop and augment tourism in a sustainable manner. The policy has been framed in the backdrop of the Atmanirbhar Bharat campaign which emphasises on ‘Vocal for Local’ thereby boosting local employment. Rupani added, “the state is gifted geographically. It has hill resorts, natural attractions, beaches, etc in addition to a rich legacy of ancient crafts and civilizations,”
Meanwhile, “the Karnataka Tourism Policy 2020-25 provides a framework for Karnataka’s tourism industry to tide over the immediate crisis and adapt to the new normal and remain healthy and competitive in the global tourism landscape,” B. S. Yediyurappa, Chief Minister of Karnataka, wrote in his foreword in the tourism policy. He added that the tourism sector is an important driver for employment generation.
“The growth of our business activities and tourism sector will bring more visitors to our shores and drive the growth of our cities and regions. We are therefore taking various initiatives with the involvement of stakeholders, both public and private, to foster a more favourable and safer ecosystem for the tourism sector,” he said adding that through the Karnataka Tourism Policy 2020-25 we wish to encourage the investors to invest in the tourism sector by providing a host of incentives and subsidies to facilitate investment in the sector. “I hope that the new tourism policy will go a long way towards improving the tourism sector in the State,” he added.
Another southern state, Andhra Pradesh, also unveiled its new tourism policy in December last year to revamp the outlook and give a paradigm shift to tourism in the state, with a theme- based approach, to make it a premier world-class destination. The Andhra Pradesh Tourism Policy 2020-25 aims at building a robust tourism infrastructure in tune with the ever-changing nature of tourism and promoting responsible tourism practices among all stakeholders.
The Govt of Goa also notified the ‘Goa Tourism Policy 2020’ in November last year with a focus on making the coastal state the most preferred destination around the year for high-spending tourists in India by 2024, and a world-class international tourism destination by 2030. The vision of the policy is to make Goa the most preferred destination around the year for high-spending tourists in India by 2024, and a world-class international tourism destination by 2030.
The Rajasthan Tourism Policy-2020 seeks to promote the state as a leading destination in national and international markets, strengthen and diversify existing products, give priority to lesser-known destinations and improve visitors experience.
Jharkhand has also drafted a new tourism policy focusing more on private investment, employment, tourism promotion and education.
Infrastructure in focus:
The new tourism policies put major thrust on infrastructure development. Almost all states are providing tax incentives to invite private players in order to boost the tourism infrastructure in the state. Currently, many of the Indian states are not equipped infrastructurally to offer the best experiences to the visitors.
One of the objectives of the Goa Tourism Policy 2020 is to develop and promote tourism infrastructure in an environmentally and ecologically sustainable manner through appropriate plans, programs and policies. “Create a more environmentally and socially sustainable tourism destination, where territorial development is more balanced between the coast and the hinterland; employment opportunities are enhanced for local Goans and growth opportunities are created for Small, Medium & Micro Enterprises,” the notification mentioned.
Gujarat, which offers the best infrastructure in the country, has also initiated measure to further strengthen the tourism infrastructure of the state. Rupani announced that the government will give subsidy of 20 per cent on capital investment for setting up a hotel in the designated high priority centers. Minimum investment requirement is Rs.1 crore, while there is no cap on maximum investment. A15 percent subsidy will be given on setting up theme parks or amusement parks in these priority centres with the investment of Rs.50 crore to Rs.500 crore. The state government will provide land on lease in addition to the 15 per cent subsidy for projects of more than Rs.500 crore. According to the new policy, the convention centres with a seating capacity of over 2500, NABH-accredited wellness centers, tourism hospitality and training centers, tents, cottages and container accommodation will also get 15 percent subsidy.
Kerala, which has been on the forefront of tourism in India, launched 27 new tourism projects apart from other infrastructural initiatives. The government has earmarked Rs 310 crore for these 27 new projects. "Once our state, the country and the world survive COVID-19, Kerala will become a tourist paradise again," Kerala Chief Minister Pinarayi Vijayan said while inaugurating these projects. He further added that the state has suffered an estimated loss of around Rs 25,000 crores due to the COVID-19 pandemic.
The Jharkhand tourism policy proposes a 30% subsidy on total capital investment for developing any tourism facilities in Jharkhand. Besides, the policy also aims to generate employment for around one lakh people in the sector through short-term and long-term planning. “Private players were roped in to develop projects on an outsourcing basis. This model can’t be sustainable unless investments are encouraged to take place in this sector for building parks, amusement options, hotels and so on. The new policy aims to be forward-looking, wooing investors to create all-round facilities for tourists,” quoted an official of Jharkhand Tourism.
The Andhra Pradesh Tourism Policy 2020-25 aims at building a robust tourism infrastructure in tune with the ever-changing nature of tourism and promoting responsible tourism practices among all stakeholders. The policy seeks to attract huge private investments through a slew of incentives. The new policy of Andhra Pradesh aims to develop high-end five and seven-star luxury resorts and hotels at prominent tourist destinations in the state. It is reported that Gandikota in Kadapa will have the first such facility soon. Besides, 13 other locations have been identified across the state, including the famous Horsley Hills, Nagarjuna Sagar, Rushikonda (Visakhapatnam), Tirupati and also Polavaram, for construction of five and seven-star hotels and resorts
The current trend suggests that tourism has been centered to select few destinations in India. The pandemic has necessitated an opportunity for states to promote lesser - known destinations due to measures like social distancing and others.
Odisha emerged as the most proactive states during COVID-19 and took it as an opportunity to conduct extensive background work to revive tourism. The Eastern Indian state is promoting eco retreat in five unique locations – Konark, Hirakud, Bhitarkanika, Daringbadi and Satkosia, Jyoti Prakash Panigrahi, Tourism Minister of Odisha said on many occasions.
The new thrust on domestic tourism prompted Odisha to launch three road trips to woo travelllers from neighboring West Bengal. The first road circuit, ‘Deep into the Mangroves’, from Kolkata to Bhitarkanika via Bichitrapur Sanctuary & Chandipur (4N-5D), covers key destinations, Bichitrapur Mangrove Sanctuary, Talasari Beach, Chandipur’s Receding Beach, Aul Palace and Bhitarkanika National Park along this route.The second road trip circuit, ‘The Trail of Cascades-Keonjhar’, from Kolkata to Keonjhar – 500 km (3N-4D) covers the Bhimkund Waterfalls, Sitabinji Caves’ fresco paintings, Terracota craft village at Ghatagaon, Gundichaghai Waterfalls, Sanaghagara & Badaghagara Waterfalls and Kanjipani Ghati. The third road trip circuit, ‘Tiger trails and Royalty’ from Kolkata to Similipal – 470 Km (3N-4D) will cover the Belgadia Palace, Similipal Tiger Reserve, Sitakund Waterfall & Ecotourism Zone, Barehipani – India’s second highest waterfall and the Nawana Valley. These trips including many new destinations which were earlier unheard for the travel community.
“The ‘Odisha by Road campaign’ intends to encourage tourists from within the state as well as from the neighbouring states to travel to various tourist destinations in Odisha through excellent network of roads. Through this campaign, we will promote some beautiful yet not so popular places of attraction which would be further facilitated by the Tourism Department,” Panigrahi said.
The recently launched tourism projects in Kerala includes the development of a hilltop tourist centre at Ponmudi in Thiruvananthapuram to the northernmost district of Kasaragod. Vijayan also inaugurated the Malamel Para Tourism Project at Kollam beach and Thanni beach. A major infrastructural developmental project was inaugurated in Ponmudi. The inauguration of a Rs. 49 lakh beautification projects of the Mooloor Memorial at Elavumthitta in Pathanamthitta district was also done.
While Kerala is sprucing up its tourism destinations, Gujarat’s new tourism policy also aims to develop new attractions in the state. Rupani said that Gujarat has hill resorts, natural attractions, beaches etc in addition to a rich legacy of ancient crafts and civilizations. He said that the state has the world’s tallest statue at Kevadia, Gir National Park, India’s first World Heritage City, world’s biggest stadium, seaplane services, Blue-Flag certified beach apart from religious places like Somanth, Dwarka and Ambaji.
Gujarat’s New Tourism Policy 2021-25 encapsulates various aspects like medical tourism, wellness tourism, MICE tourism, adventure and wildlife tourism, coastal and cruise tourism, rural based experience tourism etc. The state government had recently announced the Heritage Tourism Policy to highlight the ancient palaces and heritage places of kings.
Agri Tourism and Rural Tourism are the core tourism themes of the Karnataka’s Tourism Policy with the objective to promote not just with agriculture and farming activities but also various aspects of rural life in Karnataka such as local cuisine, culture, traditions, arts, etc.
Andhra Pradesh is also diversifying its tourism product portfolio. “We have chosen Rural Tourism, Heritage Tourism, Buddhist Tourism, Eco-Tourism, Beach and Water Tourism, Recreation and Adventure Tourism, Religious Tourism, Cuisine Tourism, Wellness Tourism, MICE Tourism and Medical Tourism,” Rajat Bhargava,Special Chief Secretary (Tourism and Culture), Govt of Andhra Pradesh, quoted as saying.
Other Indian states have also taken similar initiatives. Apart from infrastructure, states are also focusing on creating awareness through various marketing and promotional activities. Many of the states have already launched their campaigns on various media channels such as radio, social media and other digital marketing platforms to woo tourists from domestic market.
While policy solutions are needed to enable the tourism industry to live alongside the COVID-19 in the short to medium term, it is important to look beyond this and take steps to learn from the crisis, which has revealed gaps in government and industry preparedness and response capacity. It is necessary to have a coordinated action across governments at all levels and the private sector.
The crisis is an opportunity to rethink tourism for the future. Tourism is at a crossroads and the measures put in place today will shape the tourism of tomorrow. Governments need to consider the longer-term implications of the crisis, while capitalising on digitalisation, supporting the low carbon transition, and promoting the structural transformation needed to build a stronger, more sustainable and resilient tourism economy.
With 2020 labelled as the ‘pandemic year’ that witnessed all sort of unfortunate developments due to the ongoing health crisis, the rolling out of vaccines has brought much needed relief to every industry in the world including travel and tourism industry. 2020 will count among those which left an indelible mark on the course of history. The damage done to the tourism industry due to COVID-19 is beyond imagination and its spill over to 2021 is still a major concern. Experts of the industry feels that 2021 is likely to be the year when the world transitions to the next normal.
Going by the latest update, UNWTO expects international arrivals to decline by 70 per cent to 75 per cent for the whole of 2020. In this case, global tourism will have returned to levels of 30 years ago, with one billion fewer arrivals and a loss of some US$ 1.1 trillion in international tourism receipts. This massive drop in tourism due to the pandemic could result in an economic loss of US$ 2 trillion in world GDP.
T3 interacted with some of the thought leaders of the industry and all of them are of the opinion that the way forward is of cautious optimism.
The industry had to move with speed and in the face of uncertainty in a way that it never anticipated before. Although there is optimism in the air, but a lot will hinge on how the thing unfold on the economy front.
“While a combination of lockdown fatigue and announcements on the vaccine have ushered in positive consumer sentiment, the road ahead will be one of cautious optimism for the sector at large,” says Madhavan Menon, CMD, Thomas Cook (India).
Rakesh Bansal, CEO, Amadeus India & sub-continent says that although it is too early to talk about life after COVID-19, as we entered into 2021 we have reason to be cautiously optimistic. “Breakthroughs in bioscience and medicine are helping to reduce the risks of contamination and limit the spread of the virus better than ever before. This is good news for everyone and particularly those who long for the freedom to travel. Helping travellers get safely back on the road, in the air, on the railways and into hotel rooms is a top priority for the industry. We’re seeing a growing number of industry initiatives from stakeholders such as The Commons Project and IATA’s Travel Pass,” Bansal adds.
Sandeep Dwivedi, Chief Operating Officer, InterGlobe Technology Quotient, opines that the industry is currently at the transition point both in terms of COVID-19 crisis and overall advancement in the sector. “Old methods are gradually shifting as market is advancing towards new methodologies, technologies and opportunities. With customers expressing interest in travelling and out-of-home activities, businesses in the industry have actively started innovating to bring safer, convenient options to meet this demand. On a broader scale, including international travel and global condition, various factors are at play, such as low GDP growth, especially below forecast for many economies; web meetings reducing the demand for business travel, further expected to be impacted by up to 35 per cent; and new waves of outbreaks restricting international movement as to the UK,” Dwivedi says.
Dwivedi further opines that while gradual lifting of restrictions may show signs in first quarter of 2021, yet the situation is skeptical and at the same time dynamic, and it may take up to 12 months for all restrictions to be lifted. “All this throws light at a slow but steady revival of low-scale out-of-home activities in what I call a testing-phase from customers,” Dwivedi adds.
According to Kerrie Hannaford, Vice President Commercial, Accor India & South Asia, travel decisions currently are being led by keeping safety and hygiene as prerequisites. “The hospitality industry will remain dynamic but will now be extra cautious, agile and innovative. Hotels are also undergoing a transformation with the deployment of digital, contactless solutions and potential design changes because of changing social behaviour and health considerations. We firmly believe that every crisis presents itself with opportunities. Domestic tourism is rebounding, sustainable travel is in focus more than ever before along with the emergence of experiential travel,” Hannaford adds.
Although cautious optimism is prevailing in the industry, the road ahead for the industry is full of uncertainty. Players are of the opinion that it will take time for the industry to get back to normal.
“My expectation is that 2022 will see a return to normalcy if I were to look at 2019 and 2023 will be a full-blown return to normalcy in each of our of line businesses. With regards to retail travel, I expect that when borders opened and the regulations regarding arrival at destinations as well as issuance of visas is clarified, we should see travel. As fast as business went away, I would hope that we would see a quicker return. 2021/2022 should see a degree of normalcy and 2022/2023 will see a full-blown return to normalcy,” Menon says adding that we can certainly expect more positive news in 2021 for the industry as Indians are already making their travel plans and are looking at both domestic as well as international destinations.
Dwivedi is looking at a coordinated recovery in 2021 and beyond, considering outbreaks subside in 2021 with substantial success rate of public health measures, and GDP grows in line with forecasts following availability of vaccine/s. “Further, if international restrictions are lifted 20-30 per cent faster, there shall be an optimistic growth in sight. In case of customer sentiment, expectation shall remain high on better safety with modified interiors in hospitality sector, and scientific upgrades in aviation as well as airports,” Dwivedi adds.
According to Hannaford, 2021 is looking positive in terms of bookings and Accor is hopeful that the industry will emerge stronger and provide seamless hospitality to our guests. “The ongoing trend of domestic leisure travel will keep prospering in India especially for weekend getaways, staycations, drivecations and celebrating special occasions. People want to step out of their house to simply relive the joys of travelling and relax. The overdue pent-up demand to travel has further resulted in a rise in number of bookings from the leisure segment,” Hannaford adds.
Menon opines that while booking trends for domestic travel continue, we are seeing a growth in demand for travel to longer haul destinations like Kashmir and the Andaman. “Our survey revealed that 71 per cent respondents displayed confidence in air travel and this has been substantiated by the increased demand for flight-inclusive packages,” Menon adds.
Bansal says that the success of the travel industry hinges on our collective ability to adapt, innovate, and collaborate to make travel easier, safer and more seamless than ever before. “Fortunately, the travel industry is chockfull of creative thinkers from all over the world, and our technological abilities have never been greater. Pre-COVID, the travel industry contributed approximately US$8.9 trillion to the world’s GDP – that’s roughly 1 in 10 jobs. This attests to the powerful human desire to explore the world. In 2021, this desire will remain undimmed – if not brightened –and will act as a powerful driver that will push the travel industry forward,” Bansal adds.
Citing Thomas Cook India and SOTC Travel jointly released Second Holiday Readiness Report (Dec 2020), Vishal Suri, Managing Director, SOTC Travel says that 73 per cent respondents are willing to increase spends to ensure higher levels of health and safety on their holiday – a significant 38% increase from the First Holiday Readiness Travel Report (May 2020). “The upcoming year has many weekends that can be clubbed with other holidays that make weekends longer. We are observing a rise in inquiries and bookings for these long weekends,” Suri adds.
Aditya Agarwal, Head of Corporate Strategy, Cleartrip opines that the pandemic has made forecasting challenging. “We expect the broad trend around recovery to continue moving forward. Customers were initially traveling for only emergency purposes close to the date of travel. However, over time we have seen confidence return as evidenced by the increasing share of round trips and advance bookings. We expect this trend to continue over the year further. We will increasingly see customers building confidence to travel longer distances, and as and when international travel returns to normalcy, we will see more volumes,” Agarwal adds.
Digitalisation: A game changer
With touchless becoming the new norms, digitalization is emerging as the key elements for the travel and tourism industry. Bansal expects that airports in in India is going to introduce new technologies and a greater level of automation to all of their processes in then ear future. “Contactless technologies are likely to become commonplace to enable passengers move from check-in to boarding in a more safe and seamless way. We also expect airports to adopt a range of technologies to reduce crowds and queues within the terminal buildings, to meet new demands for social distancing. The introduction of off-site passenger handling services – such as check-in and bag drop services outside the airport terminal at railway stations, conference and sporting venues, and hotels – is likely to be one such development,” Bansal adds.
Citing a recent study, Bansal says that that technology plays a crucial role in supporting recovery, as over 4 in 5 (84%) travellers said technology would increase their confidence to travel in the next 12 months by addressing concerns around mixing with crowds, social distancing and physical touchpoints. “Hence, mobile applications, self-service portals, contactless payments & transactions etc. would be the focus in the coming times,” Bansal adds.
According to Menon, technology was mission critical and technology solutions were immediately implemented post lockdown to serve our customers. “We deployed our Virtual Outlets and our Virtual Agency Network to enable contactless services to customers by equipping our teams (sales and servicing) with technology - to interact with consumers, as also access our critical internal systems for seamless delivery,” Menon adds. He says that one of the key trends driving digitalisation in the travel industry is the need for safe, contactless, yet personalized holiday planning.
Agarwal says that the pandemic has accelerated the shift from offline to online across markets. “We expect digital business models to benefit from this shift and garner a higher market share. Travel behavior has also changed, with customers placing a high degree of emphasis on flexibility and safety in travel. Industry participants that can differentiate on these two needs will also garner a disproportionate share,” Agarwal adds
Hannaford opines that guests have become more tech-savvy during the lockdown and digital interaction has gained popularity now more than ever before. “The hospitality industry has been aggressively embraced technology; Starting from booking the room, to check-in, check-outs and payment procedures. Consumers also are preferring emails, digital posters, digital menus for all the communication,” she adds.
Echoing similar opinion, Rohit Kapoor, CEO, OYO India and South Asia, stated, “In 2020, we leveraged technology in a big way by offering meaningful solutions to our consumers, partners and employees in the new normal. We focussed on continuously delivering a high-quality experience to our customers as part of our ‘Sanitised Stays’, ‘Contact-less check-ins’ and ‘Sanitised Before Your Eyes’ initiatives while adding value to the experience of our asset partners with improved occupancy and revenue.”
For Dwivedi, digitally, race for offering advanced smartphone applications and chatbot facilities has been swifter than the other areas. “Many airports and airlines are picking this trend. Voluntary contact tracing by airlines is another emerging trend; its mass acceptability and adaptability is yet to be witnessed. At ITQ, we are planning to offer digitally advanced experience and options to our community of travel agents with chatbot and AI-ML based tools for better experience and augmented decision making to help our travel agents offer smoother, smarter and safer services to their customers,” Dwivedi adds.
MICE, social events & business travel
Hannaford informs that the hospitality industry is operating in a new reality with social distancing as the norm and in increased emphasis on health safety. “With the continuous focus on providing contactless services, hospitality industry has ventured into virtual events and weddings. This new trend in the MICE segment has already started attracting the eyeballs. However, weddings have been resilient, with continuous demand through the pandemic. At several of Accor’s hotels, we witnessed a rise in demand for curated and virtual weddings,” Hannaford says adding that Accor is also expecting an increase in bookings of small meeting rooms. “Business travel will take some time to recover as people are still working from home and only travelling for unavoidable meetings only. However, we are positive that this segment will also recover gradually like others in the coming year,” she adds.
Thomas Cook (India)’s MICE teams have used the period of the lockdown to reimagine business and to conceptualise vibrant virtual/ digital models and platforms, advanced health and safety measures as well as new age technologies. “Our teams have successfully delivered exciting hybrid models and digital R&R events…We are proud of the impactful service our Corporate Travel teams were able to deliver handling the repatriation of around 10000 Canadian citizens in partnership with the Canadian High Commission during the period of the lockdown,” Menon reveals.
According to Dwivedi, business travel is one category with low signs of recovery and is expected to display baby steps towards revival in early 2021. “The year may witness gradual move towards business travel, especially in manufacturing sector where factory-visit has been long overdue. MICE may pick up for key sectors in current times like medical, banking, and technology. As these industries cover a substantial space in global marketplace, this sector shall see positive growth in 2021, comparing to 2020. Social events still remain a complex area to speculate considering new waves of outbreaks in various markets, especially Europe. This may likely portray limited growth and may shift for better when positive news regarding vaccine emerges in near future,” Dwivedi adds.
Madhavan Menon, Chairman and Managing Director, Thomas Cook (India) speaks to T3 magazine about the current scenario and the way forward.
How would you explain the current market dynamics for travel, tourism and hospitality industry?
While a combination of lockdown fatigue and announcements on the vaccine have ushered in positive consumer sentiment, the road ahead will be one of cautious optimism for the sector at large.
As a leader, we at Thomas Cook have taken this challenge head-on and put together a holistic three pronged customer confidence-building program that we call “Assured-Insured-Secured” that covers every aspect of physical safety as well as mental and financial security to give the customer the peace of mind we ought to. Our “Thomas Cook Assured” Safe Travel Program developed and rolled out in association with Apollo Clinics (part of one of the most trusted healthcare networks in the country) is the most comprehensive set of travel safety protocols in the new normal, encompassing not only our own internal processes, retail outlets etc., but also every one of our partners and service providers. We have extended this partnership with Apollo Clinics to offer a Doctor on Call 24x7 service for our customers when they travel.
Customers may still feel the need to be reassured about what happens, if they still fall ill when they travel. So we in partnership with ICICI Lombard the country’s largest private insurer, have them fully covered with possibly the most comprehensive retail travel insurance program that includes COVID 19 related hospitalization up to their sum assured
As part of the “Secured” aspect - to ensure their confidence, from a money and security point of view, we offer flexible date changes, rescheduling, cancellations and even guaranteed, accelerated refunds (subject to certain minimum criteria)
We also have launched the country’s first “Safe Holiday Helpline” to offer free expert consultation and advice to help customers navigate the maze of confusing and changing information about state regulations, International travel guidelines, etc, to instill confidence and make the best and safest choice for their travel plans.
My expectation is that 2022 will see a return to normalcy if I don’t look at 2019 and 2023 will be a full-blown return to normalcy in each of our of line businesses. With regards to retail travel, I expect that when borders opened and the regulations regarding arrival at destinations as well as issuance of visas is clarified, we should see travel.
As fast as business went away, I would hope we that would see a quicker return. To me 2021/2022 a degree of normalcy and 2022/2023 a full blown return to normalcy.
What is in the store for the industry in 2021? What is the booking trend look like?
Come 2021, we can certainly expect more positive news for the industry. Indians are already making their travel plans and are looking at both domestic as well as international destinations. Our survey that 52% of respondents stated that they are likely to take a domestic holiday while 48% of respondents likely to take an international holiday.
While booking trends for domestic travel continue, what is encouraging is that while customers were earlier restricting their bookings to close-to-home staycations/drivecations, we are seeing a growth in demand for travel to longer haul destinations like Kashmir and the Andaman. Our survey revealed that 71% respondents displayed confidence in air travel and this has been substantiated by the increased demand for flight-inclusive packages.
While destinations such as Dubai and Maldives are leading the growth trajectory when it comes to international travel, given the easing of restrictions and the positive consumer sentiment due to the vaccine announcements, we have already started seeing a steady increase in both bookings as well as queries for other international destinations such as Egypt and Kenya as well. We have also seen an uptick in demand for Bali during the months of February-March as travellers anticipate the re-opening.
Digitalisation is the way forward for the industry. What trends do you have noticed? What is your digital strategy for 2021 for IHS?
Technology was mission critical and technology solutions were immediately implemented post lockdown to serve our customers. We deployed our Virtual Outlets and our Virtual Agency Network to enable contactless services to customers by equipping our teams (sales and servicing) with technology - to interact with consumers, as also access our critical internal systems for seamless delivery.
As a group, we have in the past continuously scaled our digital knowledge and business applications and used it as an enabler for growth. COVID-19 has reiterated the importance of technology in business as the lockdown demanded digital capabilities to be enhanced. We are not only consistently imbibing new technologies for innovation but also for simplification and optimization of core processes with a view to create a deeper understanding of all stakeholder expectations and enhancing their experience
Given the lockdowns and the current situation, the demand for virtual and contactless sales and service has accelerated. Based on customer feedback, one of the key trends driving digitalisation in the travel industry is the need for safe, contactless, yet personalized holiday planning. Our survey also revealed that given the prevailing uncertainty, Indians need human interface for guidance/reassurance in today’s COVID-19 era. A significant 71% respondents stated that they require guidance of a holiday expert and preferred to visit an outlet/Virtual Store/video chat while planning their holidays.
We also introduced India’s first Virtual Holiday Store to empower customers with contactless and convenient holiday planning, coupled with a personalized experience of our holiday experts. For our foreign exchange branches too, through our unique Virtual Branch model we will continue to facilitate contactless customer servicing. We have also operationalized a Corporate and B2B Booking Tool - to extend reach and seamless transactions.
The demand for digitization also allowed us to use the period of the lockdown to reimagine our MICE business completely - with virtual event platforms, advanced health & safety measures & new age technologies. An innovative product line of Gourmet Genie & Experiential Concierge was launched. Digital R&R events were successfully completed for top corporates in addition to physical events.
To support our Corporates, our Business Travel process was redeployed as an off-site model with bots for invoicing, refunds, streamlined processes & automated credit flow on a single platform. Our model of Centralized Service Delivery Hubs will ensure seamless remote delivery.
Technology will continue to play a crucial role and come 2021, our strategy will be to continue to leverage its use in our outreach to the customer as also continue to focus on technology driven initiatives.
How is MICE, social events and business travel shaping up?
Given the restrictions, our MICE teams have used the period of the lockdown to reimagine business and to conceptualise vibrant virtual/ digital models and platforms, advanced health & safety measures & new age technologies. Our teams have successfully delivered exciting hybrid models and digital R&R events- our digital platform allows seamless engagement across a variety of business functions and can be scaled up to include over 100000 attendees, with every aspect of it being customizable. We have launched a series of innovative product lines under our #NextinMICE offering: an exclusive selection of travel vouchers, digital events & engagements, experiential venues, Meetings Round the Corner, Staycations, Gourmet Genie (from exclusive dining experiences to delivering choicest sweetmeats/savouries at one’s doorstep), Experiential Concierge (dedicated concierge services with specially curated experiential holidays) and strategic communication & collateral design.
We are proud of the impactful service our Corporate Travel teams were able to deliver handling the repatriation of around 10000 Canadian citizens in partnership with the Canadian High Commission during the period of the lockdown.
To support our Corporates, our Business Travel process was redeployed as an off-site model with bots for invoicing, refunds, streamlined processes & automated credit flow on a single platform. Our model of Centralized Service Delivery Hubs will ensure seamless remote delivery. 44 clients of the recently acquired dnata Travel’s corporate travel portfolio have been integrated with the business unit.
F&B, workation, staycation etc are emerging as revenue earner. What is your take on this?
During the period of the lockdown and subsequent easing of travel restrictions, our teams ensured that a strategic focus was given to product development. As they adapted and created products as part of the new normal and basis the consumer’s wish-list, an exciting new range of holidays were launched such as workations, staycations, drivecations, affordable luxury holidays, etc. These quick breaks were created to counter the stress of work from home and home chores and at convenient short drivable distances/within their city of residence and also celebrate special occasions such as birthdays and anniversaries. We witnessed a significant uptake for such holidays and we expect to see a continue demand. However, while short driveable holidays were preferred post lockdown, our survey revealed to us that only 29% respondents now show preference for road travel with 71% respondents displaying confidence in air travel, which is truly encouraging when it comes to planning holidays. This has also been substantiated by the increased demand for flight-inclusive packages.
With an aim to drive safe & hassle-free travel experience, Chhatrapati Shivaji Maharaj International Airport (CSMIA), introduced a unique technology that provides results for COVID-19 in just 13 minutes. The testing facility option is available for all international arriving passengers at the airport. The 24 x 7 testing facility is located at Level 2 near exit Gate B.
In compliance with the Indian Council of Medical Research (ICMR) standards, CSMIA is the first airport to adopt the express test method by Abbott ‘ID Now’. The express test is available at INR 4500 and aims to provide arriving passengers with quick & accurate diagnosis in 13 minutes. Passengers can also opt for regular RT-PCR test which takes around 6 - 8 hours for the result.
The rapid molecular testing technology by Abbott is a tool to help fight the pandemic by allowing fast, highly sensitive and accurate diagnosis. Reducing the wait time for reports and provides early detection of the virus in time for passengers to take necessary measures to prevent disease transmission. Thus, creating a safer environment for travellers and airport staff.
The COVID-19 pandemic has delivered severe blows to the aviation industry which has already been under pressure due to various issues. Unprecedented travel restrictions throughout the first half of 2020 have forced aviation operations to all-but grind to a halt as both the leisure and business travel felt the full force of a global lockdown. The whole aviation ecosystem has been impacted by this crisis since the fear of virus forced the world to remain isolated. The crisis is growing longer and deeper than anybody could have imagined.
According to IATA, airlines burned through $51 billion in the June quarter and will burn through $77 billion in cash during the second half of 2020 (almost $13 billion/month or $300,000 per minute) despite the restart of operations. This makes up nearly 80 per cent of $162 billion of bailout money they have already received and airlines will not return to pre-COVID traffic levels until 2024 . The slow recovery in air travel will see the airline industry continuing to burn through cash at an average rate of $5 to $6 billion per month in 2021, IATA forecasts.
Another global agency, the International Civil Aviation Organisation (ICAO), in its latest report, has projected international and domestic aviation could take up to a US$399 billion hit, in terms of gross passenger revenue for the first quarter alone. While the global situation is quite alarming, the situation in India is not any better despite the growth in domestic passenger post lockdown. In India, the domestic traffic has reduced from 5,85,30,038 during March-July 2019 to 1,20,84,952 during March-July 2020. The revenue of Indian carriers has reduced from Rs 25,517 crore during April-June 2019 to Rs 3,651 crore during April-June 2020. Airport operators also saw their revenues decline to ₹894 crore in the June quarter of 2020 from ₹5,745 crore a year earlier.
Consultancy firm CAPA India estimated that Indian airlines are expected to report consolidated losses of $6-6.5 billion this fiscal and an estimated $4.5-5 billion of funding will be required to overcome the covid-19 crisis. Meanwhile, Indian carriers have asked the government to set up an interest-free line of credit of at least $1.5 billion for the aviation sector.
Thought leaders of the industry feels that there would be fewer players as the industry is all set to witness consolidation in near future. They predict that COVID-19 would make airlines more resilient as most airlines are restructuring in a very positive way.
Optimism in the air
However, airlines are optimistic with a hope that coming months will bring some respite. “As the world starts to adjust to the next phase of the pandemic and international borders gradually re-open, we are optimistic this will bring some stability for global travel demand to return. We look forward to resuming passenger services to India when it is commercially and operationally feasible to do so. In the meantime, we will continue to support repatriation flights to/from the country including Ahmedabad, Bengaluru, Chennai, Delhi, Hyderabad, Kochi, Kolkata, Mumbai, and Thiruvananthapuram - facilitating travel and helping stranded Indians return home,” Jabr Al-Azeeby, Vice President - India & Nepal, Emirates Airline said. Emirates operate passenger services to more than 90 destinations via Dubai and is committed to fully restoring its network.
The Indian aviation industry is witnessing a continued recovery in domestic passenger traffic since the opening up of the service. The domestic market saw a 37 per cent growth in traffic to 39 lakh passengers in September over August 2020. The increase in capacity deployment helped airline in attaining the growth. However, it will take time to come back at pre-COVID level.
“We believe that it may take anywhere between 12-18 months to recover from the current situation and come back to the Pre-COVID levels of travel demand, also depending upon how other countries resume their international operations and how receptive are they towards international travellers. However, we do foresee a rise in demand at the onset of the festive season, with people travelling by air to meet their family and friends and with air travel being the safest mode to travel, this will also contribute to the overall rise in demand,” Sanjay Kumar, Chief Strategy and Revenue Officer, IndiGo, said and added that travel demand has shown consistent growth after the opening of the domestic markets since May 25, 2020. “We have seen a positive trend over the first 100 days of resumption of operations post the lockdown including the steadily rising PLF, unit revenue and future bookings on the back of increasing customer confidence in air travel. We are bullish that our passenger loads will grow with the increase in capacity across our network,” he said and hoped that if the regulation around the various states becomes consistent and more liberal in terms of rules and regulations, we should see much faster growth in passenger numbers.
Vistara too is augmenting its operation to come back to pre-COVID level. “Since the resumption of operations, we have been constantly monitoring passenger demand and have been scaling up our operations in a calibrated manner. We are operating at over 50 per cent of our pre-COVID capacity, connecting 27 domestic destinations (as on 08 October 2020). We plan to further scale it up to 60 per cent of our pre-covid capacity in the coming weeks, which is the capacity allowed by the Ministry of Civil Aviation,” a Spokesperson of Vistara said. Vistara was operating operating close to 200 flights daily in the domestic sector before pandemic.
With demand from passenger gradually going up, all these carriers are incorporating innovations in its overall operations to infuse confidence among travelers. “We introduced our Lean Clean Flying Machine initiative, aimed to educate our passengers about the steps being taken for their safety and safety of others, once air travel resumed in May to enhance their confidence in air travel,” Kumar said highlighting the findings of their survey that says 95 per customers prioritize health and wellness of the airline staff, while 92 per cent feel that sanitation and safety protocols by airlines need to be in place. Personal safety kits (90%) and contactless travel experience (89%) were next on priority. “As an industry we have done well in communicating all our safety measures and protocols across platforms, with almost 93% of travellers being aware of them,” Kumar said and shared that indigo added the 6E Double Seat option, for a single passenger to book 2 adjacent seats for added emotional security based on the customer demand. Moreover, airlines are also providing complementary travel insurance globally. “Additionally, IndiGo’s travel assistance has hospitalization benefits along with coverage for COVID-19. Complementary travel insurance is being provided by Karvat Cover-More Assist Private Limited underwritten by Bharti Axa General Insurance,” Kumar revealed that IndiGo has re-started Tiffin services through pre-booking.
According to Vistara, safety and hygiene will continue to be key considerations for customers and technology will play a key role in ensuring that throughout the passenger’s journey. “At Vistara, we were already on our digital transformation journey which has only been fast tracked due to the pandemic. Initiative taken by Vistara like casting of kiosk screens on passenger mobile, scan & fly, Self-tagging, self-baggage drop, self-boarding, e-gates, biometrics/face recognition, e-boarding passes and bag tags are all touchless solutions which will go a long way to build confidence in flying again. We also launched an integrated campaign #FlyingFeelSafeAgain, aimed at generating awareness about air travel being the safest mode of travel during the Covid-19 crisis and informing customers about the airline’s various initiatives, “the Spokesperson added.
Emirates too always placed customers first and their top priority is also the health and safety of the communities we serve. “We know customers are yearning to fly and we are very proud to lead the way in boosting confidence for international travel. We modified our services to mitigate risk of infection, ensuring we always keep in line with the latest hygiene and safety protocols made by authorities and health experts. We were also the first airline in the world to offer free, global cover for COVID-19 related costs. Customers can now travel with confidence, as Emirates will cover medical expenses of up to EUR 150,000 and quarantine costs of EUR 100 per day for 14 days, should they be diagnosed with COVID-19 during their travel, while they are away from home. This cover is immediately effective for customers flying on Emirates until 31 December 2020 and is valid for 31 days from the moment they fly the first sector of their journey,” Al-Azeeby said.
Emirates also revised their booking policies to offer customers peace of mind while planning their travels. “Customers who purchase an Emirates ticket for travel on or before 31 March 2021, can enjoy generous rebooking terms and options, if they have to change their travel plans. Customers have options to change their travel dates, extend their ticket validity for 2 years, or convert their ticket into a travel voucher to use against any future flight-related purchase for themselves or their family and friends,” he said.
Sluggish demand from corporate travel
Despite all health and safety measure, traveler’s confidence are still low. While leisure and essential travel is taking place, although in slower pace, corporate/business travel is yet to be back to the market, not even with slower pace. Business travel contributes substantially in airlines’ overall business.
According to Al-Azeeby, corporate travel is heavily dependent on the reopening and recovery of economies across the world. “While some businesses may continue to use virtual meetings, we are optimistic corporate and leisure travel will resume as the world adjusts to the next phase of the pandemic. We’re currently seeing a positive trend in MICE travel across parts of Asia, which is a very positive sign of economic recovery. However, these are still early times. For us, we remain committed to serving our customers and we hope to resume our full complement of services and destinations as quickly and safely as the situation allows,” Al-Azeeby said.
Vistara also feels that a slow but consistent increase in business travel can be observed as people have started going back to their place of work. “In our customer study concluded in June 2020, 65 percent of the respondents mentioned that they expect to take their next Vistara flight before December 2020. 35 percent of the respondents expected to fly for business while 25 percent of them indicated that they would fly to visit their friends and relatives,” the Spokesperson informed.
Airlines across the globe have adopted various humanitarian measures to support a larger section of the society by giving complimentary tickets to health professionals, teachers or by extending other kind of support.
In order to contribute towards the society and help our nation in these difficult times, IndiGo operated cargo flights to ferry vital supplies and Vande Bharat repatriation flights for stranded Indian citizens. “We transported medicine, equipment and relief supplies from one part of the country to another, while adhering to all the precautionary measures. In addition to this, we also created the first ever blood plasma corridor to save the life of a patient suffering from COVID-19. The plasma units were transported on IndiGo CarGo from Bengaluru to Srinagar via connecting flights,” Kumar informed.
Community services is deep-rooted in Vistara’s culture and the airlines strongly believes in giving back to the local communities they operate in. “As part of our ongoing efforts, we had launched the Vistara Wellness Initiative in April this year by collaborating with Indian Hotels Company Limited (IHCL) to distribute over 50,000 long shelf-life nutritious food items to the frontline health workers. Since then, we have been able to distribute over 100,000 nutrition and sanitisation items to thousands of people across the country,” Vistara Spokesperson informed.
Emirates too kept communities connected through repatriation flights and cargo operations. “While waiting for borders to re-open, we actively engaged with embassies and consulates to support repatriation of stranded travellers and citizens, including our special flights to India. We also scaled up our SkyCargo network to maintain trade lanes and movement of essential goods across the world,” Al-Azeeby said and added that Emirates ensured an adequate flow of critical supplies such as pharmaceutical products, and perishables.
Despite all these challenges, airlines are keeping connect with the trade partners regularly. “We are grateful for our trade partners across the world who continue to play a vital role in our operations and success and we look forward to supporting and strengthening such crucial ties,” Al-Azeeby said. The pandemic has severely impacted all aspects of the travel industry and travel trade is a very integral part of it. “We have tried to maintain constant and transparent communication with our trade partners as we are collectively trying to re-build demand in the market,” the Vistara Spokesperson said.
We all know that rising to the challenges of a crisis is nothing new to airlines and the broader aviation, travel and tourism sector. Just as the industry has overcome past health epidemics, economic recessions, unfortunate safety incidents, and other debilitating events, it too will overcome the COVID-19 crisis.
The Republic of Indonesia has become the first signatory of the Framework Convention on Tourism Ethics, the landmark instrument created to ensure global tourism is fair, inclusive, more transparent, and works for everyone.
The ceremony, hosted by the World Tourism Organization (UNWTO) in Madrid, is a significant step towards the ratification of the Convention, which was adopted during the 23rd meeting of the UNWTO General Assembly in September 2019. With the sector currently facing up to the biggest crisis in its history, today’s signing was a clear sign that Member States are looking to UNWTO for firm leadership and remain committed to its mission to use this pause as an opportunity to realign tourism.
The Convention was hailed as a “big step forward” towards introducing a universal, legally binding ethical code for tourism, one of the world’s most important socio-economic sectors. In a special ceremony attended by the country’s Ambassador to Spain Bapak Hermono and hosted at the UNWTO headquarters, Indonesia became the first country to sign, signalling its strong commitment to uphold the highest ethical principles as it expands its tourism sector.
Indonesia played an important role in the drafting of the Convention as part of the Committee that converted the Global Code of Ethics in Tourism into an international legally binding instrument.
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