It is simply not possible to distill every global level activity to money, jobs and benefits for some. A unique example of this would be tourism and related activities. The world today, as meets our eyes now, was greatly enriched by travelers since centuries. Whether Xuan Zang for his quest to know more about Buddhism or adventurers like Christopher Columbus, Ibn Battuta, Capt James Cook, Vasco Da Gama or even inventors like Charles Darwin, the story of travel is what modern human kind is all about. Over the centuries wars, epidemics and acts of nature and man are but a few of the enemies of the wanderers. With time came faster and more efficient means of transport and that only fueled the intrinsic wanderlust in people. Ever increasing number of travelers across the globe started to flock the highways, airports and rail stations, especially after the end of World War II. From students and vagabonds to the wealthy aged, travel broke all social and most economic limitations in the free world. The consequent growth of the hospitality industry was phenomenal. With the onset of the digital globe, ticket, hotel room and transport bookings, considered a difficult job requiring coordination and synchronization till a decade ago suddenly turned easy as a piece of cake.
India, with its great tourism potentials, unfortunately always lacked something or the other. While travel related infrastructure was unavailable till recent past, people’s attitude towards international and internal travelers has never been anything to write home about. The industry in our country lacked leadership which could take up issues as a crusade and help shape policies at a national level. The business of attracting investments for industries of the normal kinds and enticing human beings to come spend money and have a good time are worlds apart. India and its people somehow have never excelled in this sphere. While tourists did come to India, it was limited to pockets like Goa, Agra, beaches of Kerala or mountains of Kashmir and Himachal. A broader spread across the sub continent was never encouraged nor even envisioned as a policy guideline. That hampered growth of airports, airlines, rail and most importantly road connectivity to places away from those usually visited. And so a plague in Gujarat or a flood in Assam impacted the travel industry in grievously. While we went about merrily building high end hotel rooms and resorts and our hotel chains became mighty, tiny places like Bali, Thailand and even Sri Lanka took the cream of travelers of all economic ranges that visited Asia. India’s poor planning, self-centered growth of the industry and the non existence of policies helping the travel and tour trade have come to face all those now who were in that trade. The COVID-19 global scare will probably cripple the Indian travel and hospitality trade for quite some time to come.
Even if governments around the world succeed in bringing COVID-19 under control, it is unlikely that most sectors will return to normalcy anytime soon. The travel sector is particularly relevant for industry-deficient states such as Odisha and Kerala, which could depend even more on tourism and travel to run the economy. Odisha had barely recovered from the destruction wrought by cyclone Fani on 3 May 2019 when the pandemic struck. According to some reports, the industry is staring down an overall loss of Rs 5 lakh crore and job cuts to the tune of 4-5 crore people. Confederation of Indian Industry has estimated that the organised sector in the industry, which includes branded hotels, tour operators and travel agencies, is likely to be hit the hardest with loss of about Rs 1.58 lakh crore. Branded hotel groups could lose around Rs 1.1 lakh crore, while online travel agencies could lose Rs 4,312 crore and inbound and domestic tour operators put together could suffer Rs 25,000 crore in losses. Adventure tour operators may lose Rs 19,000 crore, while cruise tourism which might lose an estimated Rs 419 crore also stands the chance of getting totally wiped out for some years.
The losses could amount to an erosion of 39 to 45 per cent in revenues compared with last year. The sector, without doubt, needs urgent and strong support to keep afloat and revive. It will take a holistic approach and series of measures to see the sector past the crisis. One of the key concerns of the industry is the arrival of tourists. With the lockdown in place, inflow of tourists is down to zero. Resumption of tourist arrivals depends primarily on the opening of air traffic. That will take at least till May 3 now with the extension of lockdown in place. The talk that some states like Kerala might continue the lockdown on tourism till November does no good to the trade. Even when the lockdown ends, it will take more time for tourists to actually start coming in good numbers, as the countries that have been the biggest sources of tourism to India — the US, UK and China among them — are currently battling the pandemic and incurring huge losses.
The situation is even grimmer domestically in the current circumstances. The road for domestic tourism to pick up is a longer one, given the kind of economic condition expected to prevail once COVID-19 curve flattens and dips. Once the pandemic is handled, it will still take countries a long while to repose faith in India and lift travel advisories or embargoes that have already been issued. Unless governments at the Centre and in respective states chip in to rebuild trust, the hotel and tourism industry is bound to collapse. Just like any other industry, the biggest bugbear worrying the industry is the burden of loans. Although the RBI has announced a moratorium of three months on payment of EMIs, external factors influencing the fortunes of the hotel and tourism industry makes it well nigh impossible for it to get back on track and running within the given time. The industry, especially small players, could require further monetary support in the form of collateral and interest-free loans for even up to five years to sustain and rebuild. The other major burden would be GST, both those levied by the Centre and the states in addition to charges for renewal of licenses and permits. Then there are operational expenses that include the payments and emoluments for staff and regular bills and fees such as those required to be paid to local bodies as municipal corporations. With the Prime Minister appealing to industry leaders against retrenching employees considering the circumstances, the situation becomes even further complicated for hotel and tour operators to run their ventures, let alone being profitable. Unless governments take special care of the sector, it will not recover even with intensive care at a later stage. If small and players go bankrupt and broken, large players alone will be incapable to revive the travel industry in a country like India. This is going to be a pretty long haul for the hospitality industry to move from quarantine to hospital, forget about bouncing back and recovery.