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Tourism Industry Today and Covid- Facts and Figures and Way Forward

On the occasion of World Tourism Day, I have attempted to look at stark figures over last one and half years from Jan 2020 till July 2021 I have also looked at the proposed ways (UNWTO and IBEF reports) for uplifting the human resources that has suffered immensely in this period.

The theme for World Tourism Day 2021 is Tourism for Inclusive Growth. Simply put, the aim is to help people associated with tourism in every way possible.

In keeping with the World Tourism Day theme, the United Nations World Tourism Organization (UNWTO) has urged tourists, businesses, sister-UN agencies, as well as both, member states and non-members, to raise awareness about tourism’s immense potential to uplift those who have been badly affected by the COVID-19 pandemic.

In his official message, Zurab Pololikashvili, Secretary-General, UNWTO, said, “By celebrating this day, we state our commitment that, as tourism grows, the benefits that come will be felt at every level of our broad and diverse sector, from the biggest airline to the smallest family business.”

Let us look at some of the real figures in this sector:

Tourism is one of the sectors most affected by the COVID-19 pandemic. As per the Federation of Hotel & Restaurant Associations of India (FHRAI), in FY21, the Indian hotel industry has taken a hit of >Rs. 1.3 lakh crore (US$ 17.81 billion) in revenue due to impact of the COVID-19 pandemic.

The number of international tourist arrivals declined by 74 per cent in 2020 compared with the previous year. The beginning of the year 2021 has been worse for most destinations, with an average global decline of 88 per cent as compared to pre-pandemic level. The indirect effects of this decline are even more devastating, as labour and capital remain unused and the lack of demand for intermediate goods and services has a negative upstream effect into many sectors.

Amidst all this fun and zealous college life, we only regret the fact that we could not bid adieu to the wonderful place that taught and nurtured us. April 3, 2020, the day we were supposed to formally end our journey with this institute could not take place due to the pandemic situation. But we all believe that everything happens for a special reason.

Lastly, we would like to thank Chef Atul Gokhale, Chef Manoj Patkar, Chef Hemant Gokhale, Chef Karan Umrani, Chef Bhushan Ingle, Chef Pankaj Deshpande, Chef Shamal More, Chef Rizwan Yargatti and Hitesh Sir for their immense amount of support and patience towards us. We will forever be grateful and you all are the best! We really hope to see you all soon!

The massive contraction in tourist arrivals
The UNWTO reports that almost all countries have implemented travel restrictions of one sort or another, such as travel bans, visa controls and quarantines (UNWTO 2020). As a result, international tourism was almost totally suspended in April and May of 2020 Inbound tourist arrivals declined 74 per cent between January and December 2020, about 1 billion trips. However, if the pre-COVID months of January and February 2020 are excluded, the fall in arrivals amounts to 84 per cent.

The Labour-Intensive Industry
Jobs at stake Tourism is an important source of income for many developing countries, accounting for 50 % of total exports for many small economies, particularly Small Islands Developing States such as Maldives and Saint Lucia (UNCTAD 2020b). Tourism has relatively low barriers to entry and employs a high share of young people and women. UNWTO (2021) estimates that 100-120 million direct tourism jobs are at stake. India has seen a reduction of -59% reduction in tourist arrival though the silver lining has been the domestic tourism has shown revival.
In FY20, tourism sector in India accounted for 39 million jobs, which was 8.0% of the total employment in the country.
The estimated losses in employment of unskilled labour due to the fall in tourist arrivals has been huge. The losses vary according to the proportion of unskilled labour employed in the tourism industry and the extent to which the tourism sector is hit in a specific economy. There is a somewhat similar fall in wages and rates of return for skilled labour and capital.

The Rebound
It is likely that tourism in countries with a high share of vaccinated people will rebound faster than in countries with a low share. Travel within Europe and North America, for example, is likely to pick up faster beginning this summer than many developing countries, who are still struggling to get sufficient vaccines and are thus expected to rebound slower. By 2028, international tourist arrivals are expected to reach 30.5 billion and generate revenue over US$ 59 billion. However, domestic tourists are expected to drive the growth, post pandemic.
International hotel chains are increasing their presence in the country, and it will account for around 47% share in the tourism and hospitality sector of India by 2020 and 50% by 2022
India was globally the third largest in terms of investment in travel and tourism with an inflow of US$ 45.7 billion in 2018, accounting for 5.9% of the total investment in the country.
Hotel and Tourism sector received cumulative FDI inflow of US$ 15.61 billion between April 2000 and December 2020
Indian government has estimated that India would emerge with a market size of 1.2 million cruise visitors by 2030-31. Dream Hotel Group plans to invest around US$300 million in the next 3-5 years for the development of the cruise sector in India.

Road Ahead
First the revival of the tourism sector has to be looked at holistically and it is important to mitigate the socio-economic impacts on livelihoods. Developed countries have used fiscal measures to support tourism businesses and workers.
Food sector is seeing some revival but travel restrictions is still putting the travel and tourism sector on a slow path of recovery.
Staycation is seen as an emerging trend were people stay at luxurious hotels to revive themselves of stress in a peaceful getaway. To cater to such needs, major hotel chains such as Marriott International, IHG Hotels & Resorts and Oberoi hotels are introducing staycation offers were guests can choose from a host of curated experiences, within the hotel. India’s travel and tourism industry has huge growth potential. The industry is also looking forward to the expansion of e-Visa scheme, which is expected to double the tourist inflow in India. India's travel and tourism industry has the potential to expand by 2.5% on the back of higher budgetary allocation and low-cost healthcare facility.

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