The Hindu Business Line : Strong Re, overpricing likely to hurt inbound tourism

“The weak dollar is bound to affect the inbound travel, which can become less attractive for travellers,” said Mr Himmat Anand, CEO-India & South Asia, SITA Destination Management.

Shobha Kannan

Mumbai, Oct. 8

Strong rupee coupled with overpricing of tours in the Indian tourism industry is bound to affect the inbound travel and tourism in the country, feel industry experts.

Experts say that though inbound tourism has increased by about 20 per cent, it has, however, not done as well compared to the outbound travel.

Some of the travel companies, which usually quote the entire trip in dollars for travellers across the globe, are now planning to shift to a rupee tariff to moderate the effect of rupee appreciation.

Experts point out that though there has been no immediate impact on individual travellers it might soon start pinching them. “Travellers who have already booked their tours will surely go ahead and travel but will not spend as much as they would have spent,” said a senior official with the tourism industry.

Rising rupee

Tour operators organising overseas trips are the ones who are bound to get hurt by the appreciating rupee, said Mr Madhavan Menon, Managing Director, Thomas Cook India Ltd. “We will, therefore, quote a rupee tariff wherever possible,” he said.

“The weak dollar is bound to affect the inbound travel, which can become less attractive for travellers,” said Mr Himmat Anand, Chief Operating Officer-India & South Asia, SITA Destination Management. “It is time that we started quoting in rupee,” he added.

Mr Anand also felt that not only the appreciating rupee but also the overpriced tourism sector could be a reason for the poor performance of inbound tourism.

“Hotels have become 5-10 per cent more expensive,” he said. A lot of hotels, which used to follow a dual tariff structure, have now shifted to the single tariff structure following rupee appreciation.

Constraints

Mr Anand stated that though the business from the US is growing at a rapid pace, there is a marked change in the trend of travel. “A lot of US tour operators who used to book deluxe category hotels are now settling down for first class hotels, which are a little less expensive,” he said.

Infrastructure and availability of rooms is also a major constraint for inbound travellers. Winter, which is usually a peak season for such travellers, might not be as attractive, say industry experts.

Govt measures

However, they feel that the Government is taking adequate measures in order to make India an attractive tourist destination. The Ministry of tourism has done a number of road shows. Moreover, the ‘Incredible India’ campaign has also gone a long way in wooing tourists, said an official.

“Some States like Kerala, Madhya Pradesh and Rajasthan have taken proactive measures to promote niche tourism,” she said. She also pointed out that the railways’ effort to provide trains with specific themes will go a long way in attracting tourists.