Business News

The travel and tourism industry is seeing rapid growth.

Last year’s Budget laid the foundation for the revival of the tourism and hospitality industry, with schemes such as PM GatiShakti providing impetus to infrastructure development and connectivity across the country. As per the Economic Survey 2023, the tourism industry witnessed sustained growth in FY23, with hotel occupancy improving to 68-70% in November 2022. If this is any indication, it is safe to say that the travel and tourism sector is on the fast track to growth and set to surpass pre-pandemic levels.

This year’s Budget will help the sector  build on last year’s momentum, empower small businesses beyond urban pockets and open up alternative sources of income through agriculture-tourism efforts. Additionally, it has set India up as the Startup Nation for the next decade.

This Budget reiterated the government’s continued focus on developing infrastructure. The finance minister announced an increase in capital investment by 33% for infrastructure development, which will have a multiplier effect. The Budget also placed a special emphasis on the development of Indian Railways. A capital outlay of `2.40  trillion for the railway sector, along with the addition of 50 airports, heliports, water aerodromes, and advanced landing grounds will result in improved connectivity and make several remote destinations more accessible. This is an important step as our country moves towards building a robust domestic tourism ecosystem.

The FM also recognised tourism as a key sector that has the potential to generate employment for the youth. Tourism will be promoted on ‘mission mode’, with active participation from all states. Given India’s unique landscapes and experiences, tourism can act as catalyst for economic growth.

Developing 50 cities across India as a ‘complete package for tourism’, and pioneering an app to ensure all key metrics related to travel and tourism are regularly updated, are great ways to steer the growth of the sector while also catering to the needs tech-savvy travellers. However, a revision of the 12% GST rate on hotel rooms under `1,000 would have gone a long way in offering relief to small hotel owners and customers seeking affordable stay options.

The government’s decision to incentivise states to set up ‘Unity Malls’ in their most popular tourism destinations for the promotion of GI, ‘Made in India’ products and handicrafts would enable the states to promote their culture and create avenues to boost their economy.

The integrated development of theme-based tourism under the ‘Swadesh Darshan Scheme’, with a focus on improving infrastructure and amenities in border villages, will provide a much-needed boost to rural and agriculture tourism. This will empower farmers in building and setting up homestays that provide an additional source of income while also providing an authentic Indian experience to travellers.

Another commendable move is the sector-specific upskilling and development to achieve the objectives of ‘Dekho Apna Desh’ initiative launched by PM Modi last year. This will encourage the youth to pursue a career in tourism and hospitality.  At a time when government support is vital, the initiatives announced in the Budget will surely help India realise its true tourism potential and also power the growth of sectors closely associated with it.



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