Published on : Friday, December 11, 2020
The introduction of COVID-19 vaccines in the United Kingdom and successful test results of other vaccines are signs of light at the end of the tunnel. Even though the large-scale deployment the vaccine by different governments will take time, the tourism sector can now look ahead to rebuilding itself after what has been the most catastrophic year till date.
Tourism enterprises, which have been in a state of suspended animation, can now expect credit lines to open up even as some of the restrictive factors such as travel restrictions, slow virus containment and low consumer confidence would remain in play. Businesses seeking credit should focus on sustainable and meaningful itineraries that can draw customers out of their comfort zones and plans that can generate immediate cash flows.
The substantive restoration of international flights may only happen by the third quarter of 2021. Given this reality, the immediate game plan for India would be to focus on its domestic market. India is fortunate to have a sizeable critical mass of purchasing power for tourism services. India attracts about 11 million international visitors annually; about 26 million Indians travel abroad every year spending an estimated $25 billion. If we are able to tap into this customer base and harness it towards domestic consumption, we should be able to transition this phase with minimum pain. The Government of India’s LTC cash voucher scheme is an excellent tool to revive domestic demand.
The most important role in kick-starting tourism lies with the state governments who need to start working together with the industry more than ever to create strong public-private partnerships to maximise the impact of the limited resources available. Essentially, the interventions should be centred on four pillars.
The first pillar is to have ‘harmonised health protocols’ among states in order to make inter-state travel easy and predictable.
The Ministry of Tourism and the Ministry of Health should initiate the dialogue with the state governments to evolve a harmonised set of protocols. Vaccinated persons theoretically carry little risk of transmitting or of succumbing to the virus. Once we are clear about the duration of immunity provided by a particular vaccine, we could have unique electronically-generated and verifiable vaccination certificates linked to Aadhaar for enabling unhindered travel.
The second pillar is to have ‘comprehensive safety and hygiene protocols.
This will ensure that the traveller is protected at all touch points from airports to hotels, restaurants, taxis, tourist attractions, public washrooms, etc. It is not only necessary that we have these protocols in place, but we also need to ensure that they are followed rigorously and are communicated effectively to allay fears in the minds of prospective travellers.
The third pillar is to have a ‘focused restart’ at select destinations.
Destinations which opened up in a hurry and were forced to retrace their steps have paid a punitive price in terms of loss of consumer confidence. It would be wiser to hand pick a few destinations, judiciously deploy adequate resources and work backwards in order to make them safe and establish credible models based on the principle of carrying capacity.
The Ministry of Tourism should launch an umbrella campaign to kick start domestic demand and to communicate dos and don’ts effectively to prospective travellers and the host communities.
The fourth pillar is to ‘build synergies with aviation’.
Even though consumers at present prefer to travel by cars to nearby destinations, we would need to rely on air travel to achieve meaningful critical mass within a safe and controlled environment. The aviation sector is perhaps as badly affected as the tourism sector and there is no better time than the present for both the sectors to mutually support each other to ensure survival.
The key to overcoming consumer diffidence would be to offer end-to-end packages by bundling together the costs of travel, accommodation, food and site-seeing making the overall offering price competitive and removing the risk of unknown costs. Our tourism and aviation stakeholders should work closely to map the demand as destinations open up and collaborate to put together comprehensive packages.
States can incentivise airline connectivity to priority destinations by waiving or reducing the Sales Tax on Aviation Turbine Fuel to lower their operating costs.
Tags: India’s tourism sector