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Reasons for Downward Trend in International Tourist Arrivals/Tourism Business of Tour Operators
 

1.   INDIA STANDS AS AN OVERPRICED DESTINATION

As a destination, India is quite an expensive country especially, in comparison to other competing destinations.  The major reason being the tax component which is between 20 – 25% of the tourist package cost.  All other leading tourist destinations have effective rate of tax between 5 – 8% only. Coupled with this is the airfare to India from tourist generating countries which is always expensive in comparison to equidistant tourist destinations.

2.   RATIONALIZATION OF ROAD TAXES

Lot of journeys is made by surface transport in India and interstate taxes are involved. There is no rationalized road tax regime. Each state following their own criteria which varies from 10-40 %. This needs to be looked into on a top priority. Also to have a seamless travel with single point tax collection system should be evolved. Otherwise this puts tourists in lot of inconvenience and wastage of time when the tour operators’ representative had to run around to get the required permit.       

3.   TOUR OPERATORS BE GIVEN THE BENEFIT OF EXPORTERS

Tour operators be given the benefit of exporters on the basis of foreign exchange earnings and exempted from service tax. We have been pleading since two decades for this benefit which was totally ignored by the government. To revive industry, this aspect should be given a top priority.

The benefit of 80 HHD should be restored for next 5 years so that the sagging tourism industry can be boosted. Under Section 80 HHD of Income Tax Act, tour operators had the benefit of reinvesting 50% of their foreign exchange earnings in Infrastructure and tourism promotion business that boosted tourism in a positive manner. (But this stands withdrawn).

Unfortunately, all international portals making bookings online do not pay any service tax as their offices are not based in India thus they are not liable to pay the service tax. This has dented our business in a big way and we are losing business to these online business operators. 

4.   RATIONALIZATION OF STATE LUXURY TAX

One of the major tax components on the package tours is luxury tax being charged on the hotel room rent. This is being levied by the State Governments. However, the each state has different policy and charging luxury tax from 5% to 20%. Also some of the states are charging luxury tax on the declared printed tariff and some states are charging luxury tax on the actual room rent paid. This should be rationalized to make tourist packages competitive with our neighboring countries and should be fixed to maximum 5% and should be charged on the actual tariff.  The recent example is of luxury tax in Delhi which was earlier 10% on the published tariff and has been increased to 15% on the published tariff.  We wrote to the Chief Minister of Delhi but nothing could come out.

Some of the states are charging luxury tax on the declared printed tariff and some states are charging luxury tax on the actual room rent paid. This should be rationalized to make tourist packages competitive with our neighboring countries and should be fixed to maximum 5% and should be charged on the actual tariff.  The recent example is of luxury tax in Delhi which was earlier 10% on the published tariff and has been increased to 15% on the published tariff.  We wrote to the Chief Minister of Delhi but nothing could come out.

5.     DUAL TARIFF ON LUXURY TRAINS

Though on paper, the dual tariff has been withdrawn but our luxury tourist trains in India run by the state governments and IRCTC have their tariff in Dollars which is detrimental to the interest of tourists as also tour operators. Not only, in the process, the tourist pays a lot more, but also, the foreign tour operators tend to lose their profits.  All other tourist products in India are sold in local currency.  Similarly, the tariff for luxury trains should also be in Indian Rupees. Because of this luxury train business has gone down as reported in the press also.

6.    E-TOURIST VISA (ETV) NEED AMENDMENTS LIKE MULTIPLE ENTRY, INCREASE IN DURATION OF STAY, APPLICATION AND BIO METRIC PROCESS BE ABOLISHED FOR NORMAL VISA

Though the e Tourist Visa has been introduced and made valid for 150 countries till date, the impact is negligible as there is lot of bottleneck areas which makes this facility not tourist friendly. Ultimate result is unproductive. For the tourists to make full use of this facility, action of the following is needed urgently or we miss the train.  

   i)    Under e-Tourist Visa, double/multiple entry visa be allowed so that members selling combined packages of India, Nepal, Sri Lanka etc. can also ask their clients to apply for e-Tourist Visa. Presently all such tourists are avoiding India due to constraint of single entry. The duration for Multiple or double entry visa should be extendable to 45 to 60 days and visa fee may be charged on pro-rata basis in case if it is necessary to increase. This will increase international tourist arrival to our country.

   ii)      For long haul traffic, applicants should be allowed to apply for e-Tourist Visa at least 90 to 180 days’  in advance instead of 30 day, where ever possible as foreign tourists want to finalize their travel well in advance and buy the best priced air tickets before hand not at last minute.

   iii)       There is no Biometric facility available at any of the Indian Ports where big cruise ships are coming. Due to the fact India is losing overland tourists visits and just day's excursions are conducted.  If the facility of Biometric can be provided at major ports of India then India can get the benefits of extra foreign exchange earnings with longer duration of tourists spending more time in India and fly out from other cities to catch the Cruise in next country. Therefore, at all major ports where cruise ships are coming with full of tourists, facility of Biometric should be made available. This will help get ETVOA for the cruise passengers also.

   iv)    The other issue which international tourists are facing is Biometric process for the normal tourist visa.  This is creating lots of problems for the tourists as they need to spend extra time and money especially in big countries where Indian Embassies/Consulates are located at distant places. They have to pay for travel and hotel accommodation to do biometric process. This process discourages the tourists to select India as a holiday destination.  It is requested that all Tourist Visa whether e-Tourist Visa or normal multiple entry visa, should have biometrics upon arrival at International airports in India only.

   v)    Lot of Buddhist Tourists visit our country from countries like Sri Lanka, Malaysia, Myanmar, Thailand, Cambodia, Laos, and Vietnam etc.  For those countries and all SAARC countries, Visa fee should not be more than 20 USD for e-Tourist Visa or it should be on reciprocal basis. In Sri Lanka for E-Visa, it is 15 USD and for Visa on Arrival it is 25 USD.

7.     OVERSEAS MARKETING

The marketing of India Tourism overseas remained totally negligible. Hardly India was visible in global markets through media/electronic campaigns. India tourism needs to rebrand the campaign to match with the new trends and the new market specific requirements and in the language of the country being focused. It should be more informative and how the bookings can be made rather than generic.

8.     APPOINTMENT OF PR AGENCIES AND ITMR

There was a proposal to have PR agencies/India Tourism Marketing Representatives overseas but what is latest position in this regard is known to the trade. Nearly there is a gap of one year, when this was initiated but matter is still pending for a positive decision.   

9.    OVERSEAS ROAD SHOWS – PR AGENCY CHARGES TO BE COVERED BY THE MINISTRY OF TOURISM, GOVT. OF INDIA

One of the most important issues is participation of our members in the road shows being organized in coordination with the Ministry of Tourism Govt. of India and India Tourism offices overseas. It is observed that members have lost their interest in participating in road shows because they have to share the 50% cost of the PR agency charges which was not there prior to 2013 and the entire local responsibility of expenses was of concerned India Tourism offices and members who were going need to make arrangements for their air travel, stay, local travel, promotional material. Now with this new system of members sharing the PR agencies charges, this has become cost prohibitive for the members and need to be reversed and concerned India Tourism office should bear the PR agency cost. Our members invest money and time on this exercise therefore the cost of PR agency must be borne by India Tourism offices.

10.    TOURISM PROMOTION MATERIAL

Promotional material in our overseas offices are not available. Not even a good 5 – 8 minutes India Destination DVD. Whereas, our competitive countries have good literature supply regular press release, with solid PR agency, display materials, brochures, photographs CD/DVDs, films given to tour operators to boost India holiday destination.

11.    VACANT POSTS IN OVERSEAS OFFICE

The overseas offices remained vacant for nearly three years. That in turn did not help us to hold promotions in the market and we lack visibility. Even the foreign tour operators did not feel to visit our India tourism offices when they find there is no head in the office to give an immediate decision and like to promote a destination which are supportive to overseas tour operators for brochure support, joint promotions, for media visits, educational tours etc.  

12.    CRISIS MANAGEMENT POLICY

There is no crisis management team to combat any negative publicity globally or by taking action against advisories issued by foreign governments and press releases to counteract those negative reporting or a system of giving a letter from the Minister or Secretary re-assuring the industry that India back in business and everything is normal, which in turn can be used by the tour operators to create confidence and assure that India is a Safe Destination and India Means Business. This is a normal practice which is not followed in India. Incidentally Negative publicity in the international press regarding the safety & security of women tourist is a major point of concern for the tourist to decide against visiting India.  The Government is making efforts on this issue, however, it is also important to be proactive and counter such news in the international media. Single women traveler are now avoiding India and they form about 15 % of overall traffic to India. 

13.    LACK OF GENERAL HYGEINE

Though our Prime Minister is very much concerned about the Clean India and started Clean India Campaign and for this Swacch Bharat Cess was introduced but the actual impact is not visible. The garbage on the roads in India especially near the monuments and tourist attractions puts off the tourist. Unfortunately, pictures about them have been reported by the Press in many countries over the last decades.  Foreign tourists are very concerned about the hygiene & cleanliness and, therefore, decide against travelling to India.

14.    DOMESTIC AIRLINES TARIFF

The domestic airlines hardly play their role as facilitators for tourism sector.  Very little effort has been made by them to connect tourist destinations properly.  Because of scarce availability, lot of time in back tracking is wasted by the tourist.  Moreover, during peak season, the airlines tend to take undue advantage and charge 2 – 3 times the normal airfare.

15.    BAGGAGE ALLOWANCE ON DOMESTIC SECTORS

On international flights, 23-30 kgs is the baggage allowance per passenger which has been reduced to 15 kgs by the domestic airlines, creating lot of problems for the tourist. Every time they check in, they are asked to either pay excess baggage charge or take out stuff from their check in baggage. Foreign tourists do not feel happy in doing this. Tourist is compelled not to do shopping in India. Thus, we lose additional source of earning foreign exchange.

16.    SHORTAGE OF LANGUAGE SPEAKING GUIDES

Quality of guides across the country is not commensurate with the requirement especially the language guides. Barring few places, they are hardly available.  Guides’ Training Programmes must be conducted in all regions and specifically at tourist centres focusing not only on English language but various important international languages as well.

17.    ENTRY OF REGIONAL LEVEL GUIDES

New Guide Policy of Archaeological Survey of India need immediate revision. IATO is discussing with Ministry of Tourism and Ministry of Culture as per High Court directives.   

18.    PROMOTION OF BUDDHIST CIRCUIT

The Buddhist Circuit has immense potential but India has not reaped its benefits.  The number of visitors attracted by China to their artificially created Buddhist sites are far greater than ours. Macro level planning of the entire Buddhist Circuit is the need of the hour.  We should have proper rail, road & air connectivity linking all the sites. An international standard train must operate on circular route connecting all sites. We do not have air connectivity, therefore, there is no demand visible.  But, due to the absence of this facility, the affluent Buddhist Tourists are giving a pass to India. Proper roads with mid-way facilities is yet another must. At least 4-Star Hotels, if not 5-Stars, should be available at all Buddhist centres. The Gaya International airport should be opened to Chartered & Scheduled flights without restrictions. As we were never pro-actively involved in the promotion of Buddhist Sector, therefore, we have actually turned away lot many good promoters and investors.  We will have to go pro-actively to convince people to consider this opportunity afresh.

 19.    0% GST ON TOURISM INDUSTRY

GST may be implemented soon.  We have to ensure tourism activities remain at the lower rate.  The transactions in foreign exchange should attract 0% GST only, to make India competitive globally.

20.    ISSUES WITH THE RAILWAYS:-

 i)     Earlier our tour operator/travel agent members were given the license to work as authorized Rail Ticketing Agent of Indian Railways and were doing substantial amount of rail booking for their clients including tourists from overseas.  Presently renewal of RTA license has been stopped by the railways. RTAs were bookings for foreign clients months in advance to avoid any inconvenience to them upon arrival in India. This must be reconsidered and licence be renewed for Rail Ticketing Agents.

 ii)      Group Tourist booking facility like airlines group booking system should be in place and our members should be able to make group bookings on behalf of their foreign tourists under Foreign Quota.

 iii)     Number of seats in Foreign Quota should be increased so that our members can reserve seats for them.

 iv)     A separate designated parking area for Tourist Vehicles and tourist coaches should be provided at all the major station, including all metros and places of tourist interests.

 v)      To allocate a separate booking window as Nodal point for IATO members and IATO members who are recognized by Ministry of Tourism be allowed to act as representatives to serve the foreign tourists and groups.  

 vi)        IATO members should be allowed Online Booking facility and authorized to open their email account thru IRCTC portal by having similar train ticket booking facility of 0800 hours onwards.

 vii)        Members of IATO should be facilitated with issuance of special pass to serve foreign clients for arrival and departure at the platforms just like the airport authority entry pass

 viii)      Special insurance coverage for the foreign tourists as per International standards to cover any mishap during their journey.

21.    AIRT CHARTER OPERTIONS POLICY

Charter operation is affected due to heavy charges by the Airport Authority of India for landing of aircraft and charter operators have stopped charter operations to Goa and other places. A liberalized policy should be in place for Charter Operations and not last minutes announcements during seasons.

22.    CLOSING OF RAFTING CAMPS ON THE GANGA

National Greet Tribunal has closed down all rafting camps on the Ganga. Rafting camps are most eco-friendly and do not use electricity or flush toilets unlike many local dhabas on the roadside which are the main polluting units. This is badly effecting the adventure tourism business in our country.  This may please be taken up on an urgent basis.

23.    PROMOTION OF AGRICULTURE TOURISM

For the last l0-15 years, the Department of Agricultural Research & Education, Ministry of Agriculture was giving permission for these kind of visits by the farmers/tour operators connected with agriculture tours especially from Europe, America and Australia and they were being charged US$ 50 per person per university/institute visit and Rs. 3000 for coach parking.

From September last year, the Department of Agricultural Research & Education, Ministry of Agriculture stopped giving permissions and advised our tour operators that all such requests should come through the Indian Embassy/High Commission overseas.  We tried that method also but as rightly said by our Hon’ble Prime Minister, Shri Narendra Modi ji, nothing moves through Indian Embassies/High Commissions abroad and the resulted affect was that Foreign Tour Operators virtually stopped promoting Agricultural Tours to India.

The practice of permissions by the Agricultural Research & Education, Ministry of Agriculture, Govt. of India be re-instated. This can at least be done for the Tour Operators, who are recognized and approved by the Ministry of Tourism, Govt. of India.

 

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