Tapping the great tourism goldmine

The United Nations World Tourism Organization (UNWTO) has declared 27^th September as World Tourism Day. The day serves to remind us that in this modern world, tourism is one of the most important human activities by way of numbers of persons employed and revenue generated. Every year countries throughout the world celebrate this day with great fanfare and rededicate themselves to improving their tourism industry. The theme for this year is “1 Billion Tourists, 1 Billion Opportunities”.

1,000,000,000 international tourists

Now, keep your calculator, pencil and paper handy … we are entering number land. In 2012 for the first time a billion people packed their bags and went travelling internationally.  Take a moment to understand this number. One billion is equal to a 1,000 million, or 100 Crores. This is 20 times the population of divided Andhra Pradesh and around 80% of our nation’s population. With a world population now a shade over 7 billion people this means that an incredible 1 in 7 people living on planet earth are going to be travelling for fun this year. Despite slow economic growth in advanced countries, threats of terrorism and incidents of pandemic like diseases the Travel & Tourism (T&T) industry has shown resiliency and growth. It is estimated that by 2030 there will be 2 billion travellers.

One billion opportunities

UNWTO Secretary-General Taleb Rifai expresses it eloquently when he declares “This year´s World Tourism Day is an opportunity to celebrate the transformative potential of one billion tourists“.  The key words here are “transformative potential”.  Not only does T&T sector enable countries to gain economic strength – they also reflect tourism´s vast potential and increased capacity to address some of the world´s most pressing challenges, including socio-economic growth, inclusive development and environmental preservation. This author recently visited Kashmir and was surprised to discover the generous hospitality and positive approach to tourism of Kashmiris. It was easy to see how much they value tourism and that an increase of tourism in that state would be transformative in their attitude towards government and their relationship with the rest of the country.

Big deal!

T&T sector is indeed a big deal because the business is a leading economic sector, contributing 9% of global GDP and 6% of the world´s total exports. T&T is a bigger employer than automotive, mining and financial services combined. T&T employed more than 105 million directly worldwide this is 4 times more than the mining sector which employs just 27 million.  AP state government wanting to get their hands on the bauxite in our pristine agency areas please note that tourism will generate more employment there than mining. Interestingly the T&T sector at $ 2,364 billion is six times bigger than the software industry of $ 407 Billion in GDP revenue.  As soon as a person starts planning a holiday someone somewhere starts earning an income. Benefits flow to internet travel advising sites, travel agents, airlines, railways, bus services and so on. When the actual travel commences, hundreds of persons get an opportunity to cash in. For example taxi operators, porters, restaurants, hotel staff, guides, tourist map makers, small vendors, you name it. For countries that know how to work the tourist trade, each and every tourist is an opportunity to make a living from thereby bring wealth into their economy. The total direct and indirect contribution of T&T to the world GDP is a humongous $ 7,580 billion. The benefits of T&T helps accelerate the rise in income of entire countries and improve the quality of life of their citizens.

International tourists? We aren’t ready

The economy of countries benefits from foreign tourism mainly because it brings in foreign currency. Countries like Spain, France, Germany, USA, UK, Switzerland, Australia, Italy, Japan and Canada the top 10 most competitive countries in the Travel & Tourism universe mint money from tourism and a large portion of their population survive on the business. India, despite its great historical advantage, huge landmass, diverse culture, heritage monuments and awesome landscape has not been able to cash in on the increased tourism activity worldwide. According to the World Economic Forum Travel & Tourism Competitiveness Index 2015 ranking, India ranks 52 out of 141 countries. No wonder then that that we get a measly 7.7 million foreign visitors a year – around 0.77% of the global number - compared to China which gets 56 million. Even tiny Vietnam at 7.5 million arrivals gets more tourists than us. Let us face it we are not a preferred destination for the international tourists because we do not have the infrastructure, the expertise and the cultural environment to make foreign tourists comfortable.

Domestic tourism – captive audience

Domestic tourists in India is said to be around 1,145 million. Before Andhra Pradesh was divided the top three states in domestic tourism numbers in 2013 were Tamil Nadu with 244 million, UP with 227 million and undivided Andhra Pradesh with 152 million.  Undivided AP enjoyed a 13% share of domestic tourism. After the division Andhra Pradesh will get only around 90 million domestic tourists and our share of the national figure will drop to around 7%. We must also note that Tirupati with 40 million religious tourists every year contributes half of Andhra Pradesh’s so called domestic tourism figures. We don’t have to be Einstein to know that AP must first focus on the captive domestic segment until we are ready to attract foreign tourists. We must work hard to increase the per capita tourist spend in our area.

We want your money honey

There are several reasons why tourism is welcome. Some will say it is a way of building relationships between the peoples of the country and the world at large. Just as we want to show-off our new house to family and friends, many take pride in showing off their city to others. Others may point out that tourism removes parochialism and broadens our minds. While these esoteric reasons are valid the most important reason for encouraging in-bound tourism is that it increases employment and brings in revenue. That is why whatever we do in the tourism sector we must first ask whether the investment we put in will increase revenue and employment? All half-baked schemes that will drain our resources but not get us increased tourism and extra income must be jettisoned forthwith. We must remember that our tax money goes into every government tourism investment and therefore these investments must start yielding profits as soon as possible. In these austere times, we must not put our money into hare-brained tourism projects just to make a local leader feel good. Do small things often, always do them right, ramp up our capabilities – that must be our mantra.

Different sites, different policies

While this revenue objective is paramount we must add two riders. First the increased visitors should not strain our available resources and become a burden on the local population. Secondly it should not damage our environment and heritage. Some tourist attractions like amusement parks are made for high footfalls so as to keep the per ticket cost down. Others like Bora caves or Thotlakonda are environmentally sensitive and heritage sites. These are not picnic spots for mass tourism. The objective here should be to keep footfall down while maximising revenue with high per ticket value. If we can pay Rs. 100 for an Inox cinema ticket we can certainly pay the same or more to see a unique 1 million year old cave or a 2,000 year old Buddhist monument complex. The entrance ticket for the Cairo museum is $ 10 and the place is always crowded. Adults are charged $ 50 to enter the Waitomo caves in New Zealand and there is always a queue … often with plenty of Indians.  This is an international formula and has worked well in all tourism savvy countries.

How is our government doing?

In Andhra and Vizag District in particular tourism is not going anywhere. Our local leaders make outlandish announcements filled with jargon like “corridors”, “hubs”, “smart”, “fast-track” and “branding”. The ideas then lie like a herd of muddy water buffalo in a village pond. Ideas are plenty but implementation doesn’t happen. Money gets wasted by indecision and ignorance. This probably explains our miserable progress in the T&T business.  If we really want to pull ourselves out of this mess and take advantage of the potential of tourism our tourism department must turn to professionals. Our portion of the 1 billion opportunities is getting wasted.