With over 44 years of experience in India’s tourism industry, Rajiv Mehra is one of the veteran leaders of the hospitality industry. As president of the Indian Association of Tour Operators (IATO), he has prepared a new roadmap and strategy to revive the industry, which is one of the worst affected by the Covid-19 pandemic.
A graduate in Economics, Mehra entered the tours and travel industry in 1977 and later formed his own company. He has travelled to over 30 countries and learnt the intricacies of the hospitality sector. He spoke to Vijay Thakur on new strategies to promote the Indian tourism industry and attract more foreign visitors. Excerpts:
Q: The Covid 19 pandemic has impacted almost all industries. How much do you think the pandemic has hit the hospitality industry in India?
A: Frankly speaking, I have never seen such a decline in the past 44 years of my experience in the hospitality industry. Firstly, in the wake of Covid-19, the Indian government stopped all international flights after March 2020. As a result, our entire industry came to a standstill and it is still there to a great extent. It was we who were affected first, and we would be the last to be revived. It is hard to calculate the loss to the tourism sector due to the pandemic. We have hardly had any business since March 2020; most of our offices are either closed or functioning with a skeleton staff. So is the case with the transport sector attached to us; their vehicles are lying unused.
According to a rough estimate, one tourist generates employment for nine people. But with no business in hand, our trained staff has gone to other sectors. When our sector starts to revive, we will have to face another problem – of trained staff.
Q: If we talk in revenue terms, how much has revenue gone down due to this pandemic?
A: I do not have figures for domestic tourists. However, as regards foreign tourists, our annual revenue generation from inbound tourists was approximately $29 billion (Rs 21,765 crore) in 2019-2020. Since there are no inbound tourists, we hardly have any business. Those who are coming to India are either here on some important business or official tour, or they are non-resident Indians coming to see their families.
Q: After the second wave of Covid-19, India’s image was hit worldwide. How do you see it from the industry viewpoint?
A: Premium Indian tourism industry is dependent upon foreign tourists. Unfortunately, after the second wave, India’s image has been hit hard. It seems there was some propaganda worldwide by vested international forces against India to defame us. It is a well-known fact that on the Covid-19 front India has performed much better than many developed nations. We are trying our best to improve our image and promote tourism. Having said that, we would also urge the government of India to launch a massive promotional campaign to correct Covid-19 myths.
Q: Some industry experts claim that the world would witness revenge tourism, and this industry would increase manifold in the coming years. Do you think India’s hospitality sectors too would be benefited by it?
A: I do not believe in this theory. There is no revenge tourism. But it is a fact that people who have been sitting at home for almost two years are now moving out to nearby destinations. But remember they are mostly going in their own cars on long weekends but not spending much, fearing Covid 19. And remember most of them are those who otherwise would have gone to foreign destinations. According to me, the surge in domestic tourism is not revenge tourism.
Q: The Government of India claims that it has given several sops and incentives to the tourism industry. What more do you expect from the government?
A: Let me admit, so far the government has done little for our industry. They have only assured loans at some reasonable rate to tour operators and guides. But till mid-October, no notification has been issued by the government. The Centre used to give us a 7 per cent incentive, a short of duty drawback, on the foreign earnings in the tourism sector. Recently they reduced it to five per cent.
Secondly, the Government has also restricted inbound tourists. As a result, those who wish to visit are not able to come here. The government has also increased the revenue-cap on the Marketing Development assistance given to Tour Operators eight times.
In a bid to promote foreign tourism, the Government has announced it will give five lakh free e-Visas to people visiting India. But this is very little and most of the benefits would be availed by people of Indian origin visiting India as they are also considered foreign tourists.
I will give you one example of the Assam Government. It is offering a grant of Rs 2 lakh to all registered tour operators, and Rs 25,000 to a guide. Please note this is no loan, but a grant which would not have to be returned. We expect similar help from the Central government to help the hotel industry, tour and travel operators, who have virtually no business after the breakout of the Covid-19 pandemic.
Q: How long do you think it will take for India’s tourism industry to come back to normal?
A: Hard to say but it would take almost three to four years to bring the foreign tourist business back to pre-Covid levels. The recovery in the tourism sector might start in December-January provided we do not witness the third wave. We have great hopes for the Government’s ongoing vaccination drive. But the need of the hour is to tell the world that the situation is not as bad as projected, rather India has performed better than many developed countries.
However, domestic tourism is bound to return to normal in another year. Yet the margins would not be the same. Due to prevailing Covid protocols, our margins have registered a dip and only time will determine how long it will take to come back to pre-Covid levels.