Tag Archives: FICCI

MOT holds virtual conference with travel and hospitality associations

The Ministry of Tourism (MOT) held a virtual conference with the tourism and hospitality sector associations of the industry recently, which was led by Yogendra Tripathi, Secretary Tourism, MOT, along with senior officials of the Ministry. The Associations represented through remote conferencing were FAITH, CII, FICCI, PHDCCI and IMAI. The industry put forth a number of ideas and suggestions for tiding over the crisis created by COVID-19 in the sector of tourism and hospitality. The Ministry on its part shared the concerns and assured the associations that the government is very much with them in this grim hour and that they would work towards the suggestions put forth. There would be a lot of thrust on promoting domestic tourism was a common takeaway. MOT is using its social handles to create awareness of the need to stay at home safe in the period of lockdown and prepare to travel once the world opens up. In the meantime, the course modules of the Institutes of Hotel Management are being held online and faculty and students are using technology to remain abreast with their course curriculum.

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67% drop in inbound, 52% in outbound tourists in Jan-Feb as compared to 2019

Tourism, hospitality and aviation are among the worst affected sectors that are facing the maximum brunt of the present crisis, revealed a report on impact of COVID-19 on Indian economy by FICCI. The survey suggests that there has been a drop in both inbound and outbound tourism of about 67% and 52% respectively since January to February as compared to the same period last year, owing to large scale cancellation of travel plans by both foreign and domestic tourists. Of all the segments of the hospitality sector, the M!CE segment has been hit the most with the cancellation of major trade events. The tourism industry expects the situation to further deteriorate in March and in the forthcoming summer season i.e. April-June, says the report.

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Tourism provided 5 million more jobs in 2017-2018 than previous year

A recent whitepaper titled ‘Indian Tourism Infrastructure- Investment Opportunities & Challenges’ released by FICCI, reveals that employment generated through in 2017-18 was 81.1 million, which was almost 5 million more than what it was in 2016-17 (75.90 million). In 2015-16 employment created by tourism was 72.3 million, which was 69.5 million and 67.2 million in 2014-15 and 2013-14 respectively. The reports used data released by Ministry of Tourism (MOT), which was based on Tourism Satellite Account (TSA), which comprises of a set of 10 standard tables which are key to estimating the economic contribution of tourism in the economy. According to 3rd TSA, the share in employment generated by tourism increased from 12.19 in 2016-17 to 12.38 in 2017-18.

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More than 70% of Indian aircraft deliveries will be on lease

According to FICCI’s recent report titled ‘Opportunities and Financing  Outlook for Aviation Sector’, there will be a huge number of aircraft deliveries in India in the next few years. The report quoted a CAPA study, which estimated that out of 400 aircraft deliveries by FY22 to Indian carriers, 70-80 per cent of them will be either on direct lease or sale and leaseback transactions. To fulfil growing demand, the Government has envisaged huge capex of around US$ 15.5 billion towards development of Greenfield airports, expansion of Brownfield airports, fleet addition & maintenance by Indian Carriers and strengthening ancillary services like skill development, MRO, Cargo handling, amongst others in the value chain. This development plan by airports and airlines requires strong support from Banks, Lessors, Private Equity Firms and other Financial Institutions to cater their funding requirement.

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Online sales of travel booking to increase at a CAGR of 15% during 2017–21

The online sales of travel booking is likely to increase at a CAGR of 14.8 per cent during 2017–21, according to FICCI and KPMG India’s latest knowledge paper titled ‘Expedition 3.0- Travel & Hospitality Gone Digital’. This uprising of digital travel in India can be attributed to the increasingly digitally savvy Indian travellers. In 2017, India was projected to have accounted for 3.7 per cent of the global digital travel sales — making it the third-largest market by value in the Asia-Pacific (APAC) region. The Indian government’s move to remove high currency notes out of circulation in November 2016 is expected to have further catalysed the growth of digital travel sales in the country 2017. The most significant reform in travel has been brought by mobile applications, which have enabled the whole user experience to be available on-the-go. These include usage of mobile tickets/boarding pass, mobile check-in for hotel rooms, cab hailing applications, and even cloud passports in some countries — in addition to the basic features such as search, booking, payment, invoicing and customer support.

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Foreign Exchange Earnings from tourism in India to increase by 6.8% in 2019

Foreign Exchange Earnings (FEE) from tourism stood at USD 28.9 billion (INR 1.97 trillion) in 2018, which accounted for 5.4 per cent of the total exports, according to a latest FICCI-Yes Bank report. The contribution is further expected to increase by 6.8 per cent in 2019 and rise by 5.6 per cent p a by 2029 to reach INR 3.63 trillion. However, India ranks 14th in terms of absolute FEE and 122nd in terms of share of visitor exports in total export. India is also the third largest globally in terms of investment in travel & tourism with an investment of USD 45.7 billion (INR 3.12 trillion) in 2018, accounting for 5.9 per cent of national investment. This is expected to increase by 9.4 per cent in 2019 to INR 3.42 trillion, and further rise by 7.4 per cent p a till 2029, taking the share in national investment to 6.1 per cent.

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Tourism to provide employment to nearly 53 million people in India by 2029

Travel and tourism is expected to provide employment to nearly 53 million people in India, directly and indirectly, by 2029, as per a latest report on inbound tourism commissioned by FICCI and Yes Bank. The sector has been a key source of employment as well, directly accounting for 26.7 million jobs in 2018. Further, the total jobs from indirect and induced activity stood at 42.7 million. The number is estimated to reach 43.7 million in 2019, accounting for 8.1% of the total employment in the country.

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Focus on LCC model to get sharper in the coming years

The focus on LCC model is expected to only get sharper in the coming years, according to a report on Indian aviation commissioned by FICCI and Deloitte. It is expected that few airlines would even try out the newer Ultra-Low Cost Carrier (ULCC) model that has seen some traction in USA, the biggest domestic market of the world. They could offer absolute stripped-down travel, itemising ticket prices to the services included. Industry experts are even talking about Hybrid and Low-Cost Long-Haul (LCLH) business models. With lower cost of operations due to the waiving off of most airport charges on RCS (Regional Connectivity Scheme) routes, the ULCC model may be the newest paradigm for the industry in India. This would indeed help make air travel more affordable to the country’s millions.

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45,000 new aircraft to be delivered globally between 2018 and 2040

Over the next two decades, the global commercial aircraft fleet size is expected to grow at a CAGR of around 4 per cent. Around 45,000 new aircraft are likely to be delivered globally between 2018 and 2040, suggests a report ‘Vision 2040 for the civil aviation industry in India’ by FICCI and KPMG. The growth will be driven by socioeconomic changes in emerging economies, especially in India, China, South East Asia and the Middle East. These factors include rising incomes and aspirations, lower oil prices, fierce competition between airlines and increasing value of ‘time’. For India, Boeing raised its long-term forecast for commercial airplanes to 2,300 new jets – valued at $320 billion – over the next 20 years. Nearly 84 per cent of those are expected to be narrow bodies. According to Boeing, with more than 5 per cent of the world’s fleet expected to operate in India by 2037, commercial services like flight training, engineering and maintenance and digital analytics etc., will be the key drivers of growth. In the South Asian market, including India, Boeing forecasts a commercial services market valued at USD 430 billion over the next 20 years.

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Total passenger traffic in India to rise six-fold to 1124 million in FY2040

The total passenger traffic (to, from and within India) in India is expected to rise nearly six-fold from 187 million in FY2018 to around 1124 million in FY2040, according to a latest report by FICCI-KPMG titled ‘Vision 2040 for the Civil Aviation Industry in India’. This includes around 821 million domestic passengers and around 303 million international passengers (to and from India). The overall CAGR across the five clusters works out to around 9% in domestic and 7% in international traffic during FY 2018-2040. “The FICCI-KPMG projection is higher than the projections made by leading organisations. Given the untapped potential of the Indian aviation market and the signi􀃶cant reforms being driven by the federal and state governments, we feel that the above projections are eminently achievable. These are of course predicated on the assumption that volatility in oil prices and exchange rate will be within a reasonable range and the constraints in terms of policies, taxation, infrastructure and ease of doing business shall be addressed on priority,” the report states.

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