TravTalk India Online Magazine
India’s tourism sector is at a critical stage, burdened by policy roadblocks, infra gaps, and imbalance in inbound and outbound travel. Arjun Sharma, Chairman, Select Group, suggests bold reforms and innovative strategies to unlock the country’s vast potential.
Janice Alyosius
Drawing attention to the systemic inefficiencies and policy shortcomings faced by India’s tourism sector, Arjun Sharma, Chairman, Select Group, recently made a compelling case for transformative change to ensure the sector’s long-term sustainable growth. His insights ranged from addressing regulatory hurdles to reimagining the potential of inbound tourism and workforce diversity. Sharma urged stakeholders to act decisively to harness India’s tourism potential.
Coastal Regulation Zone (CRZ) policy hurdles
A significant portion of Sharma’s discourse revolved around the restrictive Coastal Regulation Zone (CRZ) policy, which, according to him, hinders hotel and infrastructure development in India’s coastal regions. “We have an environmental policy, a CRZ policy, that looks at hotel development on our coastal areas limited to the population. Nowhere else in the world does such a policy exist,” he said.
Sharma elaborated on the delays and complications caused by the policy, particularly in Goa. “We waited for five or six years for that policy to come into force. Now, a state like Goa has not even approved the 2019 policy. Permissions in the CRZ zone will not be accepted because that policy has not been notified by the government of Goa. We need to look at infrastructure status also from a CRZ perspective. That would be my plea,” he stressed.
Inbound versus outbound tourism
Sharma highlighted the worrying disparity between inbound and outbound tourism in India, noting that the country is currently a net exporter of tourism. “We probably have heard
9 million, 10 million, or even 12 million inbound tourists, but if you ask branded hotels and tour operators, the organised inbound tourism is no more than one to
1.5 million,” he revealed. On the other hand, outbound tourism is growing at an unprecedented pace. “We have heard 27 million outbound tourists, but serious players in the industry estimate the number closer to 9 million. Today, we are net exporters of tourism,” he explained.
Sharma warned of the long-term economic implications of the imbalance. “With India’s economy moving from $3 trillion to $5 trillion, outbound tourism will grow exponentially. In five years, we could be spending close to $100 billion in foreign exchange on outbound travel. Meanwhile, our inbound income will continue at a slow growth rate. This imbalance could pose a significant challenge,” he cautioned.
Misaligned infra growth
Acknowledging the growth in aviation and infrastructure, Sharma criticised its limited alignment with the needs of inbound tourism. “We have heard about the arrival of 1,200 new planes. These planes, however, are predominantly serving outbound tourism markets. If we fail to strategically align this growth to inbound tourism, we risk losing a significant opportunity to showcase India as a preferred destination,” he noted. Sharma emphasised the importance of establishing direct international connections to destinations within India.
Private sector’s involvement
Sharma advocated for the establishment of a centralised body akin to Invest India that would oversee tourism development across states and ministries. “This body must be predominantly driven by the private sector, with significant government involvement to ensure efficiency and accountability,” he suggested.Sharma also underscored the need to prioritise gender diversity within the tourism workforce.
Suggestions to fund inbound
In a bid to generate revenue for promoting inbound tourism, Sharma proposed an unconventional solution – taxing outbound tourism. “Time will run out if we don’t find some out-of-the-box solution. Is there time to start taxing genuine outbound tourism—say $10 or $15 per traveller—and using that money for inbound tourism? I know this suggestion will face resistance, but it’s worth considering,” he said.
