Ease of Doing Business for MSMEs: Even as Prime Minister Narendra on Monday, on the occasion of World Tourism Day, highlighted the significance of integrated wellness infrastructure to strengthen the tourism sector, MSMEs in travel and tourism space referred to as for emergency help measures ahead of the upcoming travel/vacation season. Tourism has almost certainly been the worst-hit sector due to Covid, witnessing millions of job losses.
According to a study performed by the National Council of Applied Economic Research (NCAER) in January 2021 on financial losses for households engaged in tourism and policies for recovery, 14.5 million tourism jobs had been anticipated to be lost through the very first quarter of 2020 following by 5.2 million jobs lost through Q2, and 1.8 million jobs lost through Q3. The information was shared by the Minister of Tourism G Kishan Reddy in the Lok Sabha in July this year.
The MSME-dominated tourism sector also witnessed a decline in its share in the Indian GDP by 120 basis points to 4.7 per cent in 2020, from 6.9 per cent in 2019, thanks to the Covid influence, SBI Research had noted in a report in June this year citing information from the World Travel and Tourism Council.
Now MSMEs in the tourism sector across segments such as hotels, tour operators, enterprise travel, restaurants, travel agents, tourist transporters, and more, are wary of missing the upcoming vacation or travel season starting November till March or April next year if the government does not lift the suspension on international passenger flights instantly. The ban is presently till September 30, 2021.
“We informed the government that if you lift the ban for international tourists now then the upcoming holiday season will be lost. Tourists would start planning for their travel to India if the government allows travel. If there is no clear policy then they will make plans for some other countries and it would continue to impact the tourism sector. The government has taken the cognizance and is working on how to issue tourist visas,” Pradeep Shetty, Director, Maharaja Foods & Restaurants, and Joint Secretary, Federation of Hotel and Restaurant Association of India (FHRAI) told TheSpuzz Online.
As the vaccination price goes up and the quantity of Covid instances continues to decline steadily, India is lastly searching at permitting foreign vacationers to travel India due to the fact Covid struck last year. According to a government statement in June this year, cost-free visas will be issued to the very first 5 lakh foreign vacationers or till March 31, 2022, whichever is earlier, with a total finance implication of Rs one hundred crore. In terms of vaccination, according to the government information as of Monday, India’s cumulative Covid jabs coverage had crossed 86 crores with a recovery price of 97.78 per cent.
“The only way tourism business can happen is when the government allows resumption of commercial flights. The e-tourist visas are yet to be issued while the government was kind to give half a million visas free to tourists but it would be nice to extend it further,” Ashish Gupta, Consulting CEO, Federation of Associations in Indian Tourism & Hospitality (FAITH) told TheSpuzz Online. The federation represents associations for hotels and restaurants, tour operators, hotels, travel agents, and so forth in India.
Delhi-based Ravi Gosain who runs inbound travel operator corporation Erco Travels and is also an angel investor has been out of enterprise due to the fact last year due to the ban on international flights. The essential ask from the government is to permit visas and engage tour operators like him to strategy itineraries for foreign vacationers who want to travel to India as most tour operators cater to foreign vacationers. Erco used to serve 8,000-9,000 vacationers annually ahead of Covid.
“It is only domestic tourism that is looking at recovery. Hotels may get some business because of that but not tour operators. Tour operators benefit when people book packages of at least three-four days, which is not happening currently. I am completely out of business since last year. More than 90 per cent of our customers were foreign tourists but after Covid, it has been zero. We are trying to get through this crisis with whatever savings we had,” Gosain, who is also the Vice President at Indian Association of Tour Operators (IATO), told TheSpuzz Online.
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Similar has been the circumstance for Amaresh Tiwari who personal location management corporation AT Seasons & Vacations Travel for enterprise travel or MICE (Meetings, Incentives, Conferences and Exhibitions) travel. Tiwari also heads the national body for MICE travel — India Convention Promotion Bureau (ICPB) as its Chairman. He desires the government to at least permit folks from nations that are letting Indians travel to their area.
“MICE travel always contributes three times higher revenue than leisure travel to the tourism sector. Also, MICE travellers adhere more to hygiene norms and are more Covid disciplined as they are business travellers. Since tourism is a state subject in India, every state currently has its own policies around tourism. So far, we are surviving on past credit and it has been extremely difficult to survive. I estimate there would be worth Rs 2,000 crore business opportunity by next year or 2023 but perhaps there might not be too many businesses by then,” Tiwari told TheSpuzz Online.
Currently, India’s bilateral air bubble arrangement with 28 nations, aimed at restarting industrial flight services, is underway. Under the agreement, the two nations perceive every other to be protected and permit their passengers to travel back and forth devoid of Covid restrictions. India saw about 11 million foreign vacationers in 2019 that had contributed practically $30 billion in foreign exchange earnings.
“Today we have an air service agreement with 105 countries globally but air bubble agreement is operating for only 28 countries. We have to live with this pandemic. So, vaccinated people should be allowed to travel like people with Yellow fever are allowed to travel in Africa. Otherwise, more people will die of economic starvation than they will die of Covid. There can’t be a $5 trillion economy vision unless you open the aviation sector,” Subhash Goyal, Chairman, STIC Travel Group of Companies and President, Confederation of Tourism Professionals of India told TheSpuzz Online. Goyal is also the previous Chairman at Assocham National Tourism & Hospitality Council.
To address the Covid influence on MSMSs and other enterprises in hospitality, travel & tourism, leisure & sporting sectors, the government had in March this year extended the scope of the Emergency Credit Line Guarantee Scheme (ECLGS) scheme by way of the introduction of ECLGS 3.. Enterprises with total credit outstanding not exceeding Rs 500 crore and overdue, if any, for 60 days or significantly less, as of February 29, 2020, had been eligible.
The scheme involved the extension of credit of up to 40 per cent of total credit outstanding across all lending institutions as of February 28 whilst the tenor of loans was six years such as a moratorium period of two years. However, there is presently no information on the quantity of tourism beneficiaries beneath this scheme.
The government had also introduced Rs 60,000 loan package for sectors other than healthcare such as tourism and so forth. However, the scheme is however to be notified. “The scheme has not been notified so far though we are told that operational details are being worked out. We would request the government to incentivise domestic tourism in the form of tax rebates etc., to encourage people to travel. Resort locations are about doing 50 per cent of occupancy after the second wave but city hotels are still suffering as there is no international,” added Shetty.