Bouncing back post demonetisation

The impact of demonetisation on the travel industry was short-term, lasting for only a few months. Now that normalcy has been retained, business seems to be back on track as agents gear up for the summer season. TRAVTALK finds out from the travel trade how business has been faring so far.

“In my opinion, demonetisation was a necessary bitter pill we all had to swallow. Today, it has affected all businesses and travel is no exception! When it was first announced, it definitely put everyone into a tizzy as the whole country was caught offguard, especially the travel industry with so many players who are still offline and deal in cash. But now, we are coming to terms with ‘Sorry, no cash accepted’ system. This summer, travel business has been hit but it is a temporary phenomenon. More than demonetisation, a lack of clarity and continuous changes in Income Tax rules and Service Tax has made passengers wary.”
• Sampat Damani, Chairman-Western Region, TAAI

“Demonetisation is first and foremost, great for the country, and secondly very good for us. It has been one of the biggest reasons for people going online and introducing more options for payment, booking etc. Once it was put into effect, we had one or two weeks’ hiccup after which we saw people coming online with even more gusto. It has changed the way forward for the entire nation by embracing technology and giving it a huge, much-needed push that put India in the spotlight for more investments, and as a competitor in the field. The move has opened up more avenues for online players and on the whole, broadened the options.”
• Deep Kalra, Founder & Group CEO, MakeMyTrip

“When demonetisation was announced, it seemed like the industry will be hit very badly, especially the outbound segment of travel. However though demonetization had stalled business for approximately two months in various segments of travel, the MICE segment has not been hit. The initial month was tough as there was confusion about the procedures to be followed. Since business travel is a necessity for any company and crucial for its growth, MICE movements have continued to take place. I feel in the coming months, GST will be something to watch out for which may have long term impact on the tourism industry if a high tax slab is decided.”
• Meenakshi Tomar, Director-Leisure, Luxury and MICE, Make You Travel

“November looked like a very dif- ficult month flowing into December when it looked like the travel and hospitality trade would be impacted badly. However, since January 207, the travel patterns have resumed and business as usual is back on track. I can say that even though there was a dip in the market for two months, travel did not stop. Those months were peak seasons for travelling and it can be said that demonetization slowed travel but did not affect it for long. Given that GST is yet to be implemented, I think that is where the giant is lurking and we shall have to be ready for new mandates to come.”
• Naresh Aggarwal, Proprietor, Travel Raze

“Demonetisation has impacted the tourism industry just the way it has affected many other industries. Both domestic and international holidays have taken a hit for many travel agents and tour operators. However, a few months have passed since the initial brunt was felt, the travelling public is also coming to terms with this reality and it is just a matter of time when the business will start picking up again. This is just one of the many hurdles the tourism industry has faced, and since the future is always ambiguous and perceptible to change, such impacts will come and go.”
• Mahendra Vakharia, Chairman-Western Chapter, OTOA

“The demonetisation actually helped us in the long run and was beneficial, rather than it being a setback. What happened is that the smaller travel shops weren’t rigorous about controlling where their clients came from or how the clients paid for it, which was draining business away from us. Post demonetisation, we saw the fragmented market move to the organised players making us the main beneficiary since we are the largest tour operator out of India. It definitely did more good than harm and has changed the way business is done in the country.”
• Peter Kerkar, Group Chief Executive, Cox and Kings

“We felt as if demonetisation will lead to collapse of the outbound travel industry but the fact is that it has been just few months and nobody is talking about it! It is the beauty of India that people find their ways around an incident, adapt and move on. I feel there has been no impact of demonetisation on travel. Travellers will need travel designers and travel consultants to help them plan their holidays and it depends on how one projects their area of expertise. In fact the rupee has gained and technically outbound travel should grow.”
• Amit Kalsi CEO, Experiential Travel Journeys, India Travel Award winner

“According to us, demonetisation has not had any immediate impact. Our figures for Indians travelling to Germany in January have shown that travel is strong and continuously growing. It may be so that smaller markets where cash transactions were more common may have seen some impact. It did seem like travel will dip for a little while but the impact has been very short lived, even shorter than what was forecasted. The Indian market is showing great travel patterns and demonetization has not been able to dull the travelling spirit of the Indians which is very encouraging and speaks volumes of the resilience of Indian travellers”
• Radhika Krishnan, Head-Sales and Marketing, German National Tourist Office

“In my opinion, the effect of demonetisation is now over. There were a lot of reports on foreigners having a problem in India, which surfaced at the time the announcement was made in November. At that time, there was a cash crunch throughout India. However, right now, there is plenty of currency moving around in the system and there should not be any effect on international tourists visiting India owing to currency shortage. People are booking holidays in India as well. However, not many tourists come to India, especially north India, in the summer months of May and June, as it’s too hot.”
• Lally Matthews, Honorary Secretary, IATO

“It is very encouraging to see that the number of people taking a holiday during summer is increasing year-on-year. It is heartening to note that demonetisation did not have a major impact on the peak travel season. Post demonetization, 90 per cent of Indian travellers book by debit/credit card and ironically, demonetization, luxury travel has also witnessed a rise with almost 48 per cent people willing to spend above INR 50,000 on travel in summers as against 18 per cent last year. The surge in international travel highlights that things are back to normal and also underlines that millennials are relatively intrepid and unlikely to be phased by economic problems or political unrest.”
• Sharat Dhall, President, Yatra.com

“I feel demonetisation affected tourism and hospitality business in the initial two months where the industry was stalled for sometime. This was majorly due to confusion in the market about how to go about the various processes and travellers paused their immediate plans. However I feel that it did not affect the industry for long as the situation has normalized and effects have more or less worn off. Having said that, I think GST is what we have to watch out for. It looks like the new mandate will hit the bread and butter of travel agents which will have longer affect on the business.”
• Anshul Shah, Partner, All Four Seasons

“When demonetisation was announced, the first few days can be defined nothing short of mayhem. The predictions and speculation were high and the future of leisure outbound travel looked weak. However, at present, the market has recovered at an exponential rate and it looking positive. We have had very high end queries from East India market and even though a few segments may be struggling to come up immediately, one thing is for sure that eventually, say in another month or so, the tourism market will move back to its growth trajectory. I think rather than demonetization, we should be concerned about the month of July which will bring the GST Bill.”
• Chandranath Banerjee, General Manager-Marketing and Product Development, Voyagers Club Tours

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