Category Archives: Associations

Commenting on the Union Budget, KB Kachru, President, HAI, stated, “There is a continued focus on infrastructural development, fiscal prudence and consolidation whereas tourism continues to be accepted as an engine of growth for the economy. The emphasis has been given to spiritual tourism, however, there is no mention of any policy changes to expedite the growth.” He further said, “Tourism and hospitality play a crucial role in the growth of the Indian economy. The continued focus on government spending on infrastructure development augurs well for the sector. Improved infrastructure would translate into better connectivity which will be beneficial to the promotion of tourism. The development of the eastern region especially Odisha, temple corridors in Gaya and  Bodhgaya, Rajgir and the identification of Nalanda as a key tourism site continue to demonstrate the government’s intent to utilize the potential of tourism. Regrettably, however, there has been no policy announcement to facilitate the development of hotels and promotion of inbound tourism. The announcement of GST simplification, comprehensive review of the income tax Act provides some hope for the sector that has been seeking rationalisation of taxes. The benefits to individuals on taxation will augment the spending power. The focus on skilling and incentivising employers for creating jobs are other positives that will benefit all sectors.” Although not directly linked to this budget, the industry would continue pursuing its ask for grant of infrastructure status for the hospitality sector and industry-related benefits by all state governments, Kachru added.

Giving his reaction to the Union Budget announced today, PP Khanna, President, ADTOI, said, “The budget was expected to be a comprehensive roadmap for the next five years but appears to lack substantial long-term strategies. Specific sectors, such as tourism, received attention, but the initiatives may seem insufficient in scope.” Commenting further, he said, “The government has implemented GST, which has reduced the compliance burden on trade and industry by unifying the highly fragmented indirect tax regime in India. The tax base of GST has more than doubled, and the average monthly gross GST collection has almost doubled to ₹1.66 lakh crore. On the other hand, no specific information on TCS in the tourism industry is available. The tourism industry has been impacted by the introduction of GST and TCS, with some tour operators and travel agencies facing challenges in complying with the new tax regime. However, the government has taken steps to simplify the tax process and reduce the compliance burden on businesses. The general sentiment is that the budget does not fully meet the high expectations set by previous promises.”

Sharing his reaction to the Union Budget 2024, Pradeep Shetty, President of FHRAI, says, “The hospitality sector has been pinning high hopes on the Union Budget for 2024- 25 presented today, on the backdrop of the Government of India’s stated vision of Viksit Bharat by 2047 and the critical role tourism industry holds in achieving it. However, there is nothing spectacular in the budget to bring structural changes to address the fundamental challenges it faces in a competitive world order and to accelerate the growth of the sector to be a $ 3 trillion economy by 2047. Some key demands of tourism & hospitality to revitalise the sector such as GST rationalisation, granting of infrastructure status and bringing ease of doing business and policy reforms have not been considered in the budget once again, given the well accepted multiplier effect of tourism on employment and economy. The hospitality sector is disappointed but not dejected as the overall focus on infrastructure development, employment generation and skill development and development of religious tourism centres are the silver linings which will help the sector to tide over some of the critical challenges that it faces today. The focus of Budget 2024 on youth employment, skill development and job creation are welcome initiatives. The industry has been facing a shortage of skilled workforce,especially in the hospitality sector. It is also laudable that the Honourable Finance Minister’s Budget speech highlights the Governments’ commitment to make India a premier global travel destination through targeted investment and strategic initiatives. Development of iconic spiritual sites along with promotion of cruise and beach tourism can be helpful in attracting both domestic and international tourists.”

Reacting to the Union Budget which has been announced today, Gajesh Girdhar, National Coordinator, NIMA, said, “We welcome some of the initiatives proposed in the Union Budget such as the government’s continuous focus on the development of domestic and inbound tourism, encouragement to the Indian cruise tourism industry by offering a simpler tax regime for foreign shipping companies looking to operate and lease the vessels in Indian waters. This is a significant move not only for domestic tourists but also to attract foreign tourists, who always look for new cruise destinations.” Giving a further boost to religious tourism, the Finance Minister has emphasised developing new destinations in Gaya and Bodh Gaya. However, there is no mention of any specific concession on GST and TCS for Indian Outbound Travellers to the dismay of the Tour Operator Fraternity, Girdhar further said.

Commenting on the just-concluded Union Budget 2024, Ajay Prakash, National President, TAFI, says, “As usual, the tourism industry has been left high and dry this year too. Every year, we put forward what we think are absolutely necessary steps if tourism is to realise its full potential. And like every year, it has been ignored. While tourism was mentioned as one of the three important aspects, the only thing that the FM said that the government would do was to develop the temples and the corridors at Rajgir and Bodh Gaya and Gaya, revive the Nalanda university, and there was some concession about for domestic cruises. But that is the sum total of what the Budget has to offer us, so we are very disappointed. While there has been an allocation for new airports and roads, mere infrastructure does not promote tourism. GST and TCS are burning issues and she did not touch it at all. There has to be a better system to address this.”  

Expressing her views on the Union Budget 2024-2025 presented by Union Finance Minister, Nirmala Sitharaman today, Jyoti Mayal, President, Travel Agents Association of India and Vice Chairperson, FAITH, said, “The budget for tourism is a huge letdown. Out of 28 states and 8 Union Territories, the FM focuses on the infrastructure development of a couple of states, which is quite disappointing. However, the promotion of a religious corridor in these states is appreciated. The only word of inclusion is the reduction of TDS for all e-commerce companies and a simpler tax regime for foreign shipping companies’ operations in the domestic market for cruise tourism.” She added that the focus on skilling is appreciable but where will the jobs be created in the tourism sector unless the employer can absorb more and pay the skilled youth?

The Ministry of Tourism has been encouraging cruise tourism for a while now, and we have seen some developments on that front. But in this Interim Budget, the FM has gone a step further. She said, “There is tremendous potential for cruise tourism in India. To give a fillip to this employment generating industry, I am proposing a simpler tax regime for foreign shipping companies operating domestic cruises in the country.” For domestic tourism, the FM announced projects for better port connectivity and more tourism infrastructure, that will be taken up on islands in India, including of course Lakshadweep! All in all, her Budget highlighted promoting investments into India, including its infrastructure projects. The FM has also proposed to put in place a presumptive taxation regime for cruise ship operations of non-residents. Further, it is proposed to provide exemption for any income of a foreign company from lease rentals of cruise ships, received from a related company which operates such ship or ships in India.

Rules for FDI and Overseas Investments to be simplified to increase FDI inflows and promote use of Indian Rupee as currency for overseas investments, said the FM in her Interim Budget speech. She also said that 1.5 lakh core provision for long-term interest-free loans will be made to support infrastructure investment by state governments. The states will also be incentivised to implement Business Reforms Action Plans and digitalisation to develop tourism. All in all, the Union Budget 2024 was not a total let-down as far as tourism is concerned. Perhaps it has sown the seeds for a better tourism experience in India. But that may be too far into the future. Moreover, there has been no change in taxation, which has disappointed the travel trade no end. Their main gripe was the extremely high GST rates and the procedures, as well as bearing the onus of determining the quantum of TCS.

Sitharaman has raised our hopes when it comes to tourism in India, which bodes well not just for domestic but also inbound tourism, which has been suffering since Covid. Delivering to the states, she highlighted the development of ‘iconic’ tourism centres by the states who will be allowed long-term, interest-free loans for such long-term development. For domestic tourism, the FM announced projects for better port connectivity and more tourism infrastructure, that will be taken up on islands in India, including of course Lakshadweep! All in all, her Budget highlighted promoting investments into India, including its infrastructure projects. In positioning India as a global tourist destination, we’ll also create jobs, stimulate investments and unlock economic opportunities for other sectors. In addition to the measures outlined in the interim budget, I propose the following measures. Vishnupath temple at Gaya and Mahabodhi temple at Bodh Gaya in Bihar are of immense spiritual significance. Comprehensive development of Vishnupath temple corridor and Mahabodhi temple corridor will be supported, modeled on the successful Kashi Vishwana temple corridor to transform them into world-class pilgrim and tourist destinations. Rajgir, Rajgir holds immense religious significance for Hindus, Buddhists and Jains. The 20th Tirthankara Muni Suvaratha temple in the Jain complex, Jain temple complex is ancient. The Sapta Rishi or the seven hot springs form a warm water Brahmkund that is sacred. A comprehensive development initiative for Rajgir will be undertaken. Our government will support the development of Nalanda as a tourist center besides reviving Nalanda University to its glorious stature. Odisha’s scenic beauty, temples, monuments, craftsmanship, wildlife sanctuaries, natural landscapes and pristine beaches make it an ultimate tourism destination. Our government will provide assistance for their development to Odisha …

With the aim of Viksit Bharat by 2047, the Interim Budget 2024 yet again showcased a lofty imagery of the ‘new and improved’ India. However, it does fleetingly mention tourism and its development – directly and indirectly. To build a foundation for future development, the FM underlined its Startup Credit Guarantee Schemes that will encourage new businesses in various sectors including, hopefully, tourism. She mentioned that the country ‘is capable of creating more opportunities’ which cannot be further from the truth. Sitharaman added that the focus will be on ffostering and sustaining growth to create great opportunities for all and to fulfil aspirations. She said that the MSME will be an important element of this policy. Coming to aviation, she said that it has been ‘galvanized in the past 10 years’ with number of airports doubled, expansion of the UDAN scheme, 517 new routes carrying 1.3 crore passengers, and the expansion of existing and new airports that will continue, she committed. Mentioning the success of G20 meets that took place across India, she said the country has made itself an attractive destination for MICE. ‘The corporates want to explore India and religious tourism offers great opportunities.