Category Archives: Tourism and community development

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.


Measuring Tourism’s Role at Micro-level Development in India

By Dripto Mukhopadhyay

Tourism is undoubtedly a booming industry in India. Especially, since early years of the previous decade, India has become a better known destination to international tourists. Even number of domestic tourists have also increased significantly. Government statistics suggest that foreign exchange earnings have increased significantly, number of hotels have gone up tremendously, number of countries form where we receive inbound tourists also have increased promisingly. Along with these statistics, macro level studies such as Tourism Satellite Account (TSA) 2003 and 2009 showed large scale positive impact of tourism in terms of income and employment generation in the country.

While logic and numbers are in favour of suggesting that tourism is playing a significant positive role, lots of stories in social media also pave the idea towards believing that initiatives are taken at micro level to change tourism landscapes and structure. This is also true that in India now home stays are available, we find tour operators offering specific packages, a good network of tour operators with bigger companies such as,, and several similar ones. large companies have expanded their business from ticketing to tour packages, from flight booking to bus booking etc. These evidences does not leave any space that Indian tourism sector is growing with a faster pace and also moving towards more organized in nature which was previously completely an organized one.

However, none of these talks of the fact that whether we have been able to associate tourism activities with local level development. As such I did not come across any study that even investigated this issue at all. From sustainable tourism development point of view, it is of utmost importance that the link between local economic development and tourism is established while conserving local environment, both physical and cultural. Right in this particular blog, I do not intend to talk to talk of any numbers or statistics that justifies any view in favour or against the belief that tourism is gradually leaving an imbibed impact on local economic development. There are certain reasons behind, rather personal experiences, why I am raising this question. While travelling in tourist destinations, well known and lesser known, I do not see much involvement of locals in tourism related activities. If it is there, mostly at the petty worker level. I find the observations made by large number of research studies relating to developing world that tourism still does not play any role in redistribution of resources across population, are still true. Investments are still being made in the destinations either by local rich or people external to the place. Still earnings from the destination is not reinvested in local level development, rather being siphoned from the place where it is generated. But these can rarely be captured from macro-level numbers that most of us look into while trying to measure tourism impact.

Studies are needed to capture in a manner that clearly brings out correlation between tourism’s direct and indirect impact on local level development. This needs to be done with village level, town level, block level data rather than with all India figures or state level figures. It is also important to identify indirect impact of tourism development, in the sense, infrastructure development relating to tourism activities and its impact on local economic and social development. I will start with any particular destination, preferably well known, so capture this at the earliest. Working on correlating tourism activities with development parameters of the area, including peripheral geographical spaces should provide certain ideas how these two are linked at the micro-level.

Price Index for Hotel Industry in India

By Dripto Mukhopadhyay

Whenever someone wants to work on estimating tourism demand or look into issues related price impact on tourism, price of accommodation is a crucial one to incorporate in analysis. In India lack of any time series on accommodation prices was a serious bottleneck for researchers who wanted to look into these relationships. Measuring price sensitivity is crucial for predicting tourism behaviour, be it domestic or international or for any specific country per say. This article tries to bridge that gap in a systematic manner through constructing a Hotel Price Index (HPI) for India. This HPI has taken care of different categories of accommodation also. In general, hospitality service providers are categorized into following by ministry of tourism as well as well accepted among the industry players:

  • Five star deluxe
  • Five star
  • Four star
  • Three star
  • Two star
  • One star
  • Heritage
  • Others

Heritage hotels have become popular during last decade or so. Whereas several other accommodation services are available currently, that cannot be categorized under anyone under star categories or heritage category such as service apartments, paying guest accommodations etc, which are clubbed under the category of others. An HPI at India level should represent all these categories and also should cover different corners of the country to be considered as a representative Index for hotel prices in India. The HPI presented in this article has used HVS data sets. Though HVS data is a robust one in terms of coverage, however, it captures information from 40 odd cities in India. Therefore, to some extent this HPI may be considered as slightly over-estimated one. The reason being hotels in remote areas, especially that are not well known tourist destinations, might have lower rates than that captured from the cities covered under the said survey. Continue reading

Determining the Size of the Sustainable Tourism Market

By Dripto Mukhopadhyay

A recent report on climate change sponsored by The World Bank suggests that the temperature in earth atmosphere is going to be warmer by 4 degree Celsius compared to the predicted 2 degree Celsius. And, without saying one can understand that the consequences will be much severe than those we expected during last few years. The life of different parts of the world will be marred with extreme temperature fluctuations, drought, floods and many other similar natural calamities, which will be normal occurrence rather than “Disaster” as are called today.  Why am I citing this study in this blog at all? The reason is one of the simplest one to mention and the most difficult one to implement!!!! It is that we have reached a time which urges us to act proactively and without a second thought any further.

Tourism is also a major contributor to this bleak future for mankind. Tourism market is growing at a faster pace than ever before. This is true for most of the countries that are known as the major tourism destinations in tourism map. However, the pace of popularization of the buzz words Continue reading

Economic Instruments and Sustainable Tourism

My latest article on taxation and sustainable tourism which is published in “Energy Manager, July to September, 2011, Vol 4, No. 3”. Would love to receive comments from all the readers. Please click on the link below. Thanks.

Economic Instruments and Sustainable Tourism_Energy manager article_July to Sept 2011

Measuring Attractiveness of a Destination – An Important Tool for Stakeholders

By Dripto Mukhopadhyay

Measuring Attractiveness of a Destination – An Important Tool for Stakeholders Destination attractiveness and related measurement are crucial concepts for all stakeholders of tourism activities. Measuring destination attractiveness involves the actual nature of existing destination resources and attractions, perceptions of tourists about the destination resources and attractions. An integration of these two would be important to measure the attractiveness of a destination. . We can define the concept of destination attractiveness as the perceived ability of the destination to fulfill tourists’ utility. Destination attributes can be grouped into two major categories. The first one includes innate endowments of the destination such as climate, natural resources, culture and historic attributes. The second one includes man-made developments introduced particularly for tourists, such as hotels, catering, transport, activities and entertainment and the similar ones. The prime purpose of tourists’ visits is to enjoy the local endowments and maximize their satisfaction. However, the second category of attributes is necessary to reinforce the attractiveness of the destination. The perception combining all these factors, which is latent in nature, determines tourist decision making to a large extent. Tourists’ choice of destination, expectations of from the destinations, revisits, spending amount, duration of stay and several others depend on this attractiveness. Since tourists’ intensions are always to maximize total utility, combining tangible and non-tangible, destinations with higher attractiveness should be able to larger number of tourists and in turn should receive larger spending in the destination. Therefore, for destination stakeholders it is important to measure or understand the attractiveness of the destination of which they are the stakeholder vis-à-vis, the competitor destinations. Though normally the stakeholders do have an idea about how a destination is rated by the tourists, an organized way of measuring and comparing attractiveness across destinations will enable them to identify and overcome the shortcoming as well as to enhance different attributes that determines attractiveness in the tourists mind.

Domestic Tourists versus Foreign Tourists – Indian Tourism Scenario

By Dripto Mukhopadhyay

Since the time I developed my interests in sustainable tourism development, about a decade by now, one small but million dollar question often bothers me that how exactly an intricate mechanism can be framed so that sustainable tourism development can happen in true sense. It does not only involve a few policy perspectives, but actually much beyond it. Policy prescriptions are not enough for his since it requires deliberate and concerted efforts from each of the stakeholders that include tourists, hoteliers, government mechanisms, local population and anyone else who may have some role to play in tourism activities. We see some of the activities (I am talking in terms of Indian context) on part of the central government as well as state governments where attempts are made to aware people regarding tourists attractions at various locations in the country. But, many of them are targeted towards foreign tourists rather than domestic tourists. Amongst these the prominent ones are taking part in fairs and other events in various countries to promote incredible India as one of the dream destinations. Similar efforts are mostly missing in the domestic market. The government mechanisms, tour operators, others in the hospitality sector only focus on increasing number of tourists to the locations of their interests. Hardly any Do’s and Dont’s and the reasons behind the same are conveyed to the potential customers. The only visible impact normally seen in some of the places of interests are imposition of an extra fee for those who intend to visit the place. As expected as a consequence of imposing a higher than usual fee is expression of annoyance towards paying such fees. Perhaps this may be avoided completely if the tourists are also made aware of how that fee would be used for preservation and maintenance purpose of the place and why some other restrictions are also imposed. Awareness generation about the need of a participatory tourism rather than being a mere visitor to the place can play a crucial role towards this. This also raises the question that who should be the priority target for such awareness generation and why.

The simple answer to the question is that the priority should be decided based on the extent of impact on the tourism sector. The following visual (Fig 1) presents the number of domestic tourist visits and foreign tourist visits to all places in India. It also presents the ratio between these two indicators.

The graph clearly depicts a crucial factor for Indian tourism sector. Throughout the years, the domestic tourist visits are significantly higher than foreign tourist visits and its increasing with time. The ratio between these two variables shows that till 2002 it increased continuously and reached the peak when the visits by domestic tourists were 52 times of that of the foreign visits. However, it gradually tapered down to about 40 times for some years and again in 2009 it was about 47 times. Of course the higher ratio for 2009 is an outcome of economic recessions which may be ignored as an exception year of the trend. But, still the domestic visits are at such a higher level compared to the international visits that one can easily conclude that the impact from the former will be much above that from the later. Apart from that, awareness levels of the foreign tourists are in general higher compared to the domestic tourists. Thus efforts in increasing awareness of the domestic tourists towards sustainable tourism development through tourism fairs, advertisements, online materials and other media could prove effective in eradicating several problems that are created by the tourists themselves. However, apart from the tourists, other stakeholders such as hoteliers, tour operators etc. along with local people are also needed to be made aware of their important role for sustainable tourism development. Hope at some point of time, everyone in the loop will understand the importance of the same and will change their attitudes proactively in a positive direction which ultimately will benefit all of them.