Union Budget 2023 For Tourism: Boon or Bane? The Budget highlighted tourism as one of the major sectors contributing to the overall economy of the country. However, moves such as hike in ATF price and increase in TCS mandate on overseas tour packages worry stakeholders
Opinions expressed by Entrepreneur contributors are their own.
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
Soon, the Indian tourism sector is set to get a facelift. Thanks to the slew of measures announced by finance minister Nirmala Sitharaman in the Union Budget 2023-2024.
The Budget highlighted tourism as one of the major sectors contributing to the overall economy of the country. "The sector holds huge opportunities for jobs and entrepreneurship for youth in particular and stated that promotion of tourism will be taken up on mission mode, with active participation of states, convergence of government programmes and public-private partnerships," said the minister in her speech.
A total of INR 2,400 crore has been allocated to the ministry of tourism. Out of the total, INR 1,742 crore is allocated for development of tourism infrastructure and an amount of INR 242 crore for promotion and branding. The Swadesh Darshan Scheme, a flagship scheme of the ministry of tourism, would receive INR 1,412 crore. With an integrated and innovative approach, 50 tourist destinations would be developed for providing a wholesome tourism experience providing physical, digital and virtual connectivity, availability of tourist guides and tourist security. "Such destinations would be developed as a complete package under the Swadesh Darshan Scheme, additionally, an integrated and innovative Vibrant Village Programme for development of tourism infrastructure and facilities in border villages has been proposed," she added.
The initiative to provide additional infrastructural support with fifty new airports, heliports, water aerodromes and advanced landing zones in India, along with the simplification of registration and overall regulations under the GIFT IFSC will pave the way for new entrants in the aviation industry, which has experienced increasing demand both domestically and internationally. "Theme-based tourist circuits and introduction of 'unity malls' by states to promote locally manufactured goods is yet another move that will result in revitalizing the tourism industry, along with providing multiple opportunities for employment generation and entrepreneurship," said Nishant Pitti, CEO and co-founder, EaseMyTrip.
Travel and tourism sector, which is projected to hit 9.9 per cent of the country's GDP before the end of this decade, has suffered a lot during the pandemic. Companies are expecting more relief from the government for accelerated revival. "The 4 per cent hike in ATF price will increase the burden on airlines, impacting the end consumer. However, the development of 50 new airports, helipads and advanced landing grounds to improve regional air connectivity will provide a tremendous boost to niche segments such as religious, spiritual and wellness tourism by easing passengers' commute," said Sabina Chopra, co founder and COO, corporate travel and head industry relations at Yatra.com.
The government is implementing several programs for green fuel, green energy, green mobility to aid the key priority of Green Growth. "The Union Budget 2023-24, underlines a potential boom for both domestic and international tourism. With the promotion of tourism on 'mission mode', it has also opened new avenues for job opportunities among the youth," said Aditya Ghosh, co founder, Akasa Air.
"As India's greenest airline, Akasa Air is delighted to acknowledge green growth as one the key priorities of this Budget and be at the forefront of creating green job opportunities in the country," said Vinay Dube, founder and CEO, Akasa Air.
Though the budget entails multiple welcome initiatives, one budget proposal that will negatively impact the industry is the move to increase the TCS mandate from 5 per cent to 20 per cent on overseas tour packages. "This will not only increase the upfront cash outflow for customers but will also give an unfair advantage to foreign-based online travel booking platforms over India-based travel agents and tour operators," said Rajesh Magow,co founder and group CEO, MakeMyTrip.
