At India Tourism Vision Day Pronab Sarkar, President of Indian Association of Tour Operators discusses the fiscal measures to boost the scale of inbound travellers.

In the pre- covid19 period India had a global share of 1.2 percent international travel. This, however, is not commensurate with the size and scope of India. 

In 2019, Indian inbound tourism, recorded 17.8 million plus international travellers to India. Out of these, 6.8 million plus were Indians visiting their friends and relatives (VFR) and 10.9 million plus foreign tourist arrivals. 

Pronab Sarkar, President of Indian Association of Tour Operators enlisted the measures that India could undertake to boost the inbound tourism at the India Tourism Vision Day organised by Federation of Associations in Indian Tourism & Hospitality (FAITH).

He said, “In the post – Covid-19 period our vision is to double India’s share of inbound tourism to 2.5 percent in 5 yearspost normal and then double it again to 5 per cent in the next five years post that. This will rightfully put Indian tourism in the global league where it belongs. 

But that journey begins today and today the inbound tourism industry is grasping for survival. With all key source markets such as North America and West Europe in the severe grasp of covid19 we do not see a normal start to inbound tourism till October 2021 and that too is conditional upon the vaccine being successfully deployed.” 

To survive till then, the inbound tour operators need to have an operating cash subsidy to pay salaries and operating costs as has been effectively done in the USA & the UK. 

Enumerating the financial measures, Sarkar said that the SEIS rate should be made effective 10 per cent for the next 10 years and should be payable immediately in our financial year 2019-20 bygone.

Further, he said that inbound tourism which earns foreign exchange needs to be treated at par with merchandise exports and needs to be zero rated on GST. The GST on tour operators should be 1.8 percent with full set offs which is calculated as 18 per cent GST on a 10 percent margin. Currently at 5 percent that too without setoffs it effectively comes to 18 percent on a 38 percent margin which is penal. This has made India travel one of the most expensive globally.  

“In the post covid19 era, each of our missions abroad should be activated with tourism resources for enhancing our tourism distribution in all countries post covid19. We are confident that the Indian tourism is the next global champion sector for India and the road to that vision begins by surviving and reviving today,” Sarkar concluded.