Category Archives: Sustainable Tourism

Inbound Tourism to India- Caution is Required while Using Government Data

The fruitfulness of any planning depends a lot on data quality that are used to chalk out policy and planning for certain development. Therefore, data should be as realistic and authentic as possible. Tourism being one of the most important sectors of Indian economy for its contribution to income and employment, policies should be extremely objective oriented and simple to execute easily. Thus, the data should be accurate and consistent to come out with any meaningful policy planning.

The latest data published by Ministry of Tourism is “India Tourism Statistics at a Glance 2017”.  Finding the new addition to tourism database, I thought of writing a small article in this blog space. After looking at the latest data published in the document, felt that writing on the database is even more pertinent to make relevant stakeholders aware about certain stark anomalies in the present document.

India Tourism Statistics, a publication by the Ministry, is perhaps the only authentic and detailed document on India’s tourism data. I am sure that anyone working on India’s tourism scenario at a broader scale for planning and business perspective, perhaps treats this document as a bible, especially from data availability perspective. Along with other information, it publishes quite a detailed data on inbound tourism to India. The document uses two terminologies regarding inbound tourism to India – FTA (Foreign Tourists Arrivals) and ITA (International Tourists Arrivals). One could envisage these two terms as interchangeable since the numbers were same for FTA and ITA till 2015 publication. While analyzing the number quoted in the 2017 document on inbound tourism, the following graph emerges.

Slide1     

Source: India Tourism Statistics at a Glance 2017 and India Tourism statistics 2015.

One can see the drastic difference in FTA and ITA numbers suddenly from 2014. Within a year ITA has increased by about 80%. In 2017 document Ministry has given a clarification saying that ITA numbers in 2017 document includes NRIs also along with foreign tourists. This explains the difference quite well at the face value. The question is something else.

In 2015 document, in TABLE 3.1.2 (page 79) the ITA numbers are exactly the same as FTA. The tourists in India are reported through two components – a) inbound tourists (FTA/ITA) and 2) domestic tourists. No single tourist can be accounted anywhere else. Now with this, the key question is assuming that NRIs were not included in ITA prior to the 2017 document, where were they accounted in? Were the NRIs a part of FTA till 2015 document? If yes, one needs to conclude that inbound tourists to India has gone up by 80% suddenly since 2014. And, if not, how were the NRIs accounted for? Certainly not as domestic tourists. The number of domestic tourists reported in 2017 document (Table No 17, unfortunately the document is without any page number) and 2015 document (Table 5.1.1, page 103 and 104) both reported exactly same domestic tourists as 1282.8 million and 1431.9 million in 2014 and 2015 respectively.

The only plausible explanation is that the Ministry missed out reporting 5.43 million and 5.26 million NRIs for 2014 and 2015 respectively. And, of course the tourism statistics of India missed to report NRIs for more than 20 years by now. However, it is beyond any level of belief that this can at all happen in any condition. The reason being that international tourists’ numbers cannot be missed by any chance as it comes directly from immigration department. It is a huge credibility issue for the Ministry since these are perhaps the only number that are being used by policy makers and planners as well as researchers at a broader level. Coincidentally, these different numbers have been reported only from the year when the new Central Government took charge at the helm of the country, ignoring the previous years.

However, apart from the credibility issue of Ministry’s entire document, these anomalies have lot more serious implications. Couple of graphs on India’s foreign exchange earnings (FEE) from tourism activities are presented below.

Slide2

Slide3

In Figure 2, a significant drop can be noticed in growth of FEE since 2010. Perhaps the prime factors are global recession and poor recovery of most of the economies from recession trap. The current FEE is even lower than that of the year 2000 in nominal term itself. It will be significantly lower if it is considered in real term keeping in mind inflation for last 17 years. FEE related to the NRIs could not be missed out ministry by any chance since it has to be accounted in India’s income accounting system.

If we look at the FEE per international tourist arrival it is much lower than that was envisaged till the 2017 document was published. The blue and red lines in Figure 3 suggest the difference occurred due to new numbers quoted in 2017 document. One of the key policy implications is how to enhance spends of the international tourists in the country. This does not only impact countries income and foreign exchange reserve, but more importantly the local economies of tourist attractions. Perhaps the tourism policy makers need to think through the policies from a new perspective with these set of significantly lower number of FEE per international tourists according to 2017 document.

To end this article, it is critical for all users of this important and only database of Indian tourism to look at the numbers with extreme caution. One needs to cross check numbers of the previous issues of the same document instead of considering it at the face value. Else we may come out with analysis and interpretations, which may not be true because of source data errors.

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Land Based Adventure Tourism in India

The following slides indicate the major land based adventure tourism in India and also the predominant states for each one of those.

 

 

Air Based Adventure Tourism In India

Air Based Adventure Tourism in India

Source: Computed from Adventure Tourism of India, Ministry of Tourism, Government of India, October 2016.

 

Indian Tourism Sector: Urgent Need for Competition Policies and Regulatory Framework

This article has just been published in Geography and You, Volume 19, Issue 99, Nov-Dec 2016, IRIS publication.

“Climate change as well as poverty alleviation will remain central issues for the world community. Tourism is an important element in both. Governments and the private sector must place increased importance on these factors in tourism development strategies and in climate and poverty strategies. They are interdependent and must be dealt with in a holistic fashion.” – (Francesco Frangialli, UNWTO Secretary-General, Ministers’ Summit on Tourism and Climate Change in London, United Kingdom, 13 November 2007)

Current Situation in India

Unregulated tourism activities have changed the landscape of large number of tourism destinations in India beyond repair. And, perhaps, we cannot blame only the tourism stakeholders, especially, the business owners for this. Their objective in most cases remained revenue maximization and they tried to reach the same. In the process, the ecological balance of the areas is getting destroyed to a great extent leading towards environmental degradation beyond a critical limit. This situation has arisen to a large extent due to absence of regulatory framework relating to tourism industry. In fact, there is hardly any regulatory framework in place to promote of sustainable tourism as an organized sector. This regulatory framework should make sure the sustainability in terms of environment, economy and culture.

“Tourism in the Third World, as it practised today, does not benefit the majority of the people. Instead it exploits them, pollutes the environment, destroys the ecosystem, bastardises the culture, robs people of their traditional values and ways of life and subjugates women and children in the abject slavery of prostitution. In other words, it epitomises the present unjust world economic order where the few who control wealth and power dictate the terms. As such, tourism is little different from colonialism” (Srisang, 1992). To corroborate this view, the following are the ill effects of unregulated and unplanned tourism.

  • Degradation of heritage sites
  • Commodification of the sacred resources
  • Create a market for prostitution and drugs
  • Reduce biological diversity and environmental degradation
  • Destroy habitats for wildlife
  • Pollute lakes and other water bodies
  • Overuse valuable fresh water resources
  • Contribute significantly to global warming
  • Leads to loss of scenic beauty and as a result loss of tourist attraction in long term

Promoting Sustainable Tourism

To avoid this, the country must promote Sustainable Tourism practices. Butler (1993) defined sustainable tourism as “which is developed and maintained in an area (community, environment) in such a manner and at such a scale that it remains viable over an indefinite period and does not degrade or alter the environment (human or physical) in which it exists to such a degree that it prohibits the successful development and wellbeing of other activities and processes”. Hence sustainable tourism should fulfil the following:

  • Tourism industry must ensure that tourist visits will be maintained and tourism resources will retain their attractiveness indefinitely. The carrying capacity of the area needs to be kept in mind.
  • There must be no (or only minimal) adverse environmental, social and cultural impacts.
  • All these must be achieved through maintaining the principles of sustainable development.

This is crucial keeping in mind importance of tourism industry in the country. Tourism is gaining importance in India over the years in all respects. According to Ministry of Tourism, the sector contributes to 6.88% to India’s income (GDP) in the year 2012-13. In the same year, more than 12% of the country’s employment is engaged in tourism sector. Keeping these in mind, the Draft Tourism Policy document mentioned the following as key mission for the sector.

  1. To achieve a level of 1% share of the international tourists arrivals by 2016-17
  2. 1450 million domestic tourists by 2016-17
  3. Promoting sustainable tourism as priority
  4. Enhancing competitiveness of Indian tourism industry
  5. Creating world class tourism infrastructure
  6. Ensuring greater visibility for tourist facilities
  7. Augmenting human resource base in the sectorIf we look at the current scenario of tourism development, it is more in a fluidic state rather than a concrete planning. The latest Central Government policy still in practice is of 2002. A new policy was drafted in 2015. It was circulated as Draft Tourism Policy 2015 in Tourism Ministry’s official portal. However, after a certain point of time it has disappeared from the portal. There are several boards constituted to develop or promote tourism in the country, especially to attract foreign tourists, but any regulatory authority is yet to be constituted. Another key problem element is tourism is a state as well as Central subject. Apart from Central Government, various State Governments have their own tourism policies with their own perspective to promote tourism in the states. If one carefully looks at the state level policies, many of them are quite contradictory to sustainable tourism development paradigm.
  8. As it is told at the beginning, it is not easy to prepare a regulatory framework for tourism industry. The reason being tourism activities are combination of large number of sectors that cuts across all different domains of activities of common mass. As contrast to other economic sectors, direct stakeholders for tourism activities are host communities also apart from the consumers and producers. Unlike other sectors or industries, tourism directly affects entire community of a region positively as well as adversely, depending on the nature of activities. Even from governance perspective, tourism activities cut across many different departments and hence fluidic in nature. That is one of the prime reason why even being top revenue earner as well as employment generating sector, it is one of the most neglected sectors among all economic activities from policy making perspective

As can be understood easily from the above situation, there is hardly any policy that talks of regulatory and competition explicitly regarding tourism sector. Perhaps the only significant paper available on tourism legislation in India was prepared by the Indian Institute of Tourism and Travel management (IITTM) sometime in 1990s. The focus was to identify the legislative part of the tourism sector. The complexities in framing regulatory process regarding tourism industry can be well understood. A partial list of 31 legislative acts encompasses tourism industry is presented in Appendix.

However, at the Central or the state level, several schemes are available to promote tourism activities that enhances competition. But, there is no document that talks of a regulatory aspects which is extremely crucial for tourism sector. Unregulated tourism activities have severe adverse impact on welfare of a larger section of the host communities from biodiversity, economic and cultural point of view, while it increases welfare of the tourists (consumers) and direct service providers (sellers/producers). Therefore, a balanced competition policy with appropriate regulatory measures are needed immediately to promote tourism activities that can be win-win for every stakeholder.

Requirements within a Competition and Regulatory Framework

  1. Identifying key industries/sectors that are directly linked to tourism activities and less with day to day life of common man, for instance:
    • Hospitality sector
    • Tour operators
    • Other tourism service providers etc.
  1. To look into issues that are pro- or anti-competitive
    • Policy distortions/conflicts affecting competition (national and/or state level policies)
    • Prevailing anti-competitive practices in the tourism sector
    • Possible impacts of such policies and practices on welfare issues
      • For tourists (consumers)
      • Service providers (producers)
      • Host community
  1. Suggested measures towards regulatory and competition framework on selected sectors that are directly linked to tourism activities exclusively

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Appendix

List of Legislative Acts that covers tourism industry

As adopted from an unpublished research paper of Indian Institute of Tourism and Travel management (IITTM)

  1. The essential commodities act, 1955
  2. Code of criminal procedure, 1973,
  3. The airport authority of India act, 1994,
  4. The child labour (prohibition and regulation) act, 1986,
  5. The motor vehicle act, 1988,
  6. Foreign exchange regulation act, 1973,
  7. Consumer protection act, 1986,
  8. The environment (protection) act, 1986,
  9. The prevention of cruelty to animals act, 1960,
  10. The public liability insurance act, 1991,
  11. The railways act, 1989,
  12. The sarais act, 1867,
  13. The immoral traffic (prevention) act, 1956,
  14. The employers liability act, 1938,
  15. The passport act, 1967,
  16. The wild life (protection) act, 1972,
  17. The prevention of food adulteration act, 1954,
  18. The monopolies and restrictive trade practices act, 1969,
  19. Forest conservation act, 1980,
  20. The road transport corporation act, 1950,
  21. The central excise and sale act, 1950,
  22. The Indian partnership act, 1932,
  23. The urban land ceiling act, 1976,
  24. The industries (development and regulation) act, 1951,
  25. The explosives act, 1884,
  26. The Indian penal code, 1860,
  27. The water (prevention and control of pollution) act, 1974 & the air (prevention) and control of pollution act, 1981,
  28. The Indian contract act, 1872,
  29. Development authority act,
  30. Municipal act,
  31. Ancient monument (site and remains) act, 1951.

____________________________________________________________

References:

Butler, R., 1993. ‘Tourism – an evolutionary perspective’, in Nelson, J., Butler, R., and Wall, G., (eds) Tourism and Sustainable Development: Monitoring, Planning and Managing, Department of Geography, University of Waterloo, Ontario.

Srisang K. (1992) ‘Third World Tourism: The New Colonialism”, Focus, Volume 4.

Ministry of Tourism (2015): “India Tourism Statistics 2015 At A Glance”, Government of India.

UNWTO (2008): “Climate Change and Tourism – Responding to Global Challenges”, World Tourism Organization, Madrid, Spain.

WTTC (2013): “Travel and Tourism Economic Impact – India”, World Travel and Tourism Council.

Ramachandra T. V. and Shwetmala (2013): “Decentralised Carbon Footprint Analysis for Opting Climate Change Mitigation Strategies in India”, Research Paper Indian Institute of Sciences, Bangalore.

Ministry of Tourism (2011): “Sustainable Tourism Criteria for India”, Government of India.

 

Welfare from Tourism Activities – A Critical Component for Tourism Regulatory Reforms (Part II)

This is the second article for the series I planned on Tourism regulatory reforms in India. Through much delayed than promised in my previous blog on this series. However, I sincerely hope that this might be useful and interesting to those who are involved with this partially invisible big industry and also for the general readers who take interests in diverse economic issues.

the first question that I would like to answer is why do I touch this complex issue of “Welfare” which is more familiar to social scientists, especially economists and more or less vaguely understood as a common parlance to common men. the primary reason for introducing this particular term in relation to regulatory reform is that the objective of any regulatory reforms process is to increase welfare with or without existence of competition. This prompts that a clear understanding of definition of welfare is required to develop the linkage between tourism, its stakeholders, welfare and finally their importance to regulatory reforms process.

What is welfare?    

In the simplest of words, welfare is when one person’s well-being can be improved without affecting others’ well-being adversely for the good of the society.  As long as this concept remains within a small society, it easy to manage and monitor. The moment the sphere of its applicability increases, it is not only difficult to monitor, about also becomes complex enough to understand how the welfare of the entire society can be captured. For instance, tourism is a global phenomenon, apart from being multi-sectoral. Therefore, to understand the welfare implications of tourism, one needs to capture welfare of “Hosts” and “Guests” as well welfare across sectors like economic, cultural, political, environmental and so on. This complex gamut of tourism suggests that clearly there will be winners and losers in terms of welfare.

To make this simpler, lets divide the tourism economy between “Producers” and “Consumers”. The producers are those who are providing tourism services and consumers are who are enjoying tourism services. All stakeholders (except the policy makers!!) can be categorised in these two groups for each and every kind of tourism activities. Because of diverse characteristics of of tourists and their intentions of maximizing tourism utilities, certainly there are winners and losers. To make it even more explicit, we can explore the concept further from utilitarian perspective.

Derek Hall and Frances Brown explained it nicely in one of their paper on eithis, responsibility and well-being related to tourism. Well-being of a society, though more applicable to Western countries at present, can be though of in three different types:

1. Consumerisation – The society derives its well-being from quantity and variety of material goods

2. Welfare-statism – where well-being is derived from the quantity of public goods and services citizens receive as their rights

3. Eco-welfarism – where well-being is derived from the quality of relationships between people and the relationships between people and natural environment.

These points suggests that welfare from tourism will cut across social, behavirourial, medical, psychological, economic, cultural, environmental – almost every sphere of life. For the developed countries it promotes the concept of Quality of Life. Leisure and tourism is considered as a central part of it by contributing in enhancing welfare through a combination of relaxation of mind , intellectual stimulus and physical activity for fitness. But, when we see tourism enhancing consumers’ welfare, does it also contribute positively to producers’ welfare? If we consider the less developed countries, the answer is no for certain. Most of the time we look at tourism activities from a producers’ approach, where work in providing opportunities for relaxation and rest for consumers is the key component. The key question is whether tourism also does increase quality of life from producer’s perspective. The experience says that in most of the cases it is marginal and sometimes negative.

This is where it is crucial to understand why regulatory reforms are required, especially in the less developed, countries to to keep a parity between producer’s and consumer’s welfare. Unless the industry is regulated in a proper fashion and enhance fair competition while taking care of restraining adverse impact on the host community, sustainable tourism cannot be achieved. To make a clear case of how tourists’, i.e., consumers activities minimize producers’ welfare, I will discuss it in the next article of this series.

Importance of Regulatory Reforms for Indian Tourism – 1

Since long, almost a year now, I was thinking of writing on Indian tourism industry and related regulatory reforms. But somehow not able to find time to start writing on this crucial area. Now, to make sure that I write on this and can share and discuss with those interested in this important aspect of Indian tourism among the tourism fraternity, I have decided to write this in a few installments! This one is the first of the series. My endeavour will be to write one in every week through next 3 to 4 weeks.

As we know that unregulated tourism activities have changed large number of tourism destinations in India beyond repair! But, to add to this pinch further, al these destinations are expanding their space of activities much beyond their own territory. And, of course the tourism stakeholders, especially, the business owners cannot be blamed for this since their only objective remains maximization of revenue and profit. In the process, the ecological balance of the areas are getting destroyed completely leading towards environmental disasters awaiting for all of us. And, this situation has arisen to a large extent due to absence of regulatory framework relating to tourism industry. In fact, if one looks into the tourism industry closely, it would be noticed that there is hardly any regulatory framework in place that can be used for promotion of sustainable tourism. In other words, regulatory framework that can stop unwanted activities on part of the business and facilitating pro-sustainable tourism activities, can hardly be identified.

There are large number of factors behind this absence of regulatory framework relating to tourism sector in India. One of the most important fact is hardly any study has been done to seek a tourism regulatory framework in the country. Fortunately, I can get hold of perhaps the only significant paper available on tourism legislation in India which was prepared by the Indian Institute of Tourism and Travel management (IITTM) because of one of my close friend working with the same institute. the paper was written long back, sometime in mid 1990. The principal author of this paper was a legal expert. Since the focus of the study was also to identify the legislative part of the tourism sector, as expected, the paper concentrated more on the legal aspects instead of an analysis of the merits of these legislation in promoting tourism activities. And, it goes without saying that sustainable tourism did not figure anywhere because in 1990s tourism industry itself was not really recognized properly in India regarding economic context. In fact, till today, sustainable tourism does not bear much importance in India, except some mention about it in bits and pieces. however, this paper is one f the most important one to understand the complexities in framing a regulatory process regarding tourism industry in India. Just to provide the extent of complications, let me enlist some of the laws, as mentioned in the paper, relating to tourism industry. This itself is enough strong to suggest how difficult and yet how important is the regulatory framework for Indian tourism sector.

1. The essential commodities act, 1955, 2. Code of criminal procedure, 1973, 3. The airport authority of India act, 1994, 4. The child labour (prohibition and regulation) act, 1986, 5. The motor vehicle act, 1988, 6. Foreign exchange regulation act, 1973, 7. Consumer protection act, 1986, 8. The environment (protection) act, 1986, 9. The prevention of cruelty to animals act, 1960, 10. The public liability insurance act, 1991, 11. The railways act, 1989, 12. The sarais act, 1867, 13. The immoral traffic (prevention) act, 1956, 14. The employers liability act, 1938, 15. The passport act, 1967, 16. The wild life (protection) act, 1972, 17. The prevention of food adulteration act, 1954, 18. The monopolies and restrictive trade practices act, 1969, 19. Forest conservation act, 1980, 20. The road transport corporation act, 1950, 21. The central excise and sale act, 1950, 22. The Indian partnership act, 1932, 23. The urban land ceiling act, 1976, 24. The industries (development and regulation) act, 1951, 25. The explosives act, 1884, 26. The Indian penal code, 1860, 27. The water (prevention and contro of pollution) act, 1974 & the air (prevention) and control of pollution act, 1981, 28. The Indian contract act, 1872, 29. Development authority act, 30. Municipal act, 31. Ancient monument (site and remains) act, 1951

I believe this list is enough to suggest the complexity of the regulatory aspects thought about relating to tourism sector. If one considers this list, keeping in mind that this list is some of the legislation relating to tourism sector, creating a regulatory framework for tourism sector is not only humongous but also almost impossible since different departments are involved in developing these legislation from the perspective of their own requirement, rather than tourism sector. Therefore, it is crucial that tourism sector regulations are thought of separately, which may include elements of these as well as acts from other domains, but under one single umbrella.

Another big hurdle is constitutional provisions for central and state governments. unless a synchronized regulatory framework is prepared, it will not be able to remove the obstacles or barriers towards a sustainable tourism development in the country. I will discuss this issue in the next blog of this series. Thank you.

First Time a Prime Minister in India Identifies Tourism as an Instrument to Boost Local Economy

August 15th 2014, should be marked as an important day for the Indian tourism sector. It is not because there is a new toruism policy declared since 2002, nor beause of some bold and innovative steps taken by Ministry of Tourism of Indian Government. It is simply because the new prime minister Mr. Narendra Modi’s speech on the eve of India’s Indepence Day ceremony acknowledging the potential role that can be played by tourism activities in generating income and alleviating poverty at the local level. This is one of the simplest common sense, yet unaddressed by any past prime ministers of the country in any occassion as far as I remember.

Mr. Modi has exactly mentioned the grass root level linkage of tourism sector that needs to be harnessed for a sustainable toruism development strategy in the country. His words that captured implications of tourism development for a tea stall owner, petty service providors and the similar ones are the most cricual ones. A sustainable roadmap of tourism sector is always envisaged in the form that generates income and employment for local comminity and local economy. The strong multiplier effect of tourism automatically starts turning the unturned stones of development once these acticities are started at the local level.

This is nothing new to anyone involved with tourism development in some way or other. The major problem faced till now was that the tourism officials were more concerned about how to increase the number of foreign tourists instead of domestic tourists. Recognizing the fact that only 2% of the total toturists arrivals are of foreign origin and 98% are domestic, one fails to understand why we ignore dmestic tourists and concentrate more on foreign tourists. Perhaps it is time that we focus on developing domestic tourism also without taking it for granted. Increasing the number of domestic tourists will boost local economic development much more than that can be harnessed from foreign tourists. However, a few cautionary steps must be taken to develop a sustainable tourism across destinations:

1. Awareness generation amongst domenstic toruists to conserve and protect environemnt and destination which is perhaps completely missing at present.

2. Importance of maintaining cleanliness and respect the local culture while harnessing maximum pleasure from tourism

3. To prefer eco-friendly modes of travel/activities rather than those that increase carbon footprint in the region

Local authorities need to play important role in this. It cannot be expected that behavioural characteristics the the travelers will change automatically as desired for sustainable tourism development. The destination management should be in suach manner that the tourists are made to follow the rules strictly, else penalised severely, so that over a time the scenario changes towards a more disciplined tourism sector in the country. Large number of countries in the world are examples of creating such environment over time. The major role played was by governance than anything else. Hope, the new prime minister’s views to connect the grass root level to tourism activities will be translated into some changes in policy making of the authorities who are at the helm of decision making at central, state as well as local level.