Trade News
Inbound/ Domestic News
Outbound News
Home Spotlight Details


Tuesday, 18 July, 2017, 14 : 10 PM [IST]

Issue of Tourism Investment taking Centrestage

At the FICCI Tourism Investors Meet, think tanks analyse the reasons for tourism sector not attracting the desired amount of investment and how the State Tourism Boards need to take the lead in this regard, report P Krishna Kumar & Akansha Pandey.

FICCI recently organised the third edition of Tourism Investors Meet on July 5-6, 2017 at Federation House, New Delhi. The two-day interactive conclave witnessed around 150 -180 structured B2B meetings among six state governments and 60 investors from the segments namely hotels, amusement parks, air services, convention centres, real estate companies, cruise, wellness & medical tourism, ropeways, travel agencies, tour operators sanitation and civic amenities.

On day two, the event focussed on interactive meetings whereby the state governments highlighted their policy and facilities with respect to soliciting investment in tourism infrastructure through pre-scheduled structured face to face business meetings with the prominent investors. A modest turnout of potential investors interacted with the state officials.

Some of the state governments who attended the meet were Madhya Pradesh Tourism, Rajasthan Tourism, Andhra Pradesh Tourism and Uttarakhand Tourism. Sadly, the representation from Odisha Tourism was missing at the state presentations the second day.

Making a keynote at the event in Delhi, Rashmi Verma, Secretary - Tourism, Government of India, stated that the tourism sector is not attracting investment as expected despite numerous measures taken by the government in the recent years to deregulate and make policies and procedures investor-friendly. “The real action has to come from the states who own the land. Land has to be made available to investors in a transparent fashion. Many states are taking proactive action, but are lagging behind,” she said. Verma said that one reason for lack interest of investors in hotel investment in India is long lean season. However, that is changing fast. Sharing the foreign tourist arrival statistics for May 2017 which is considered a lean month, she said there has been over 19% growth in arrivals and foreign exchange earnings, which shows a change in trend.

She conceded that world-class infrastructure is missing in many destinations despite all the efforts on the part of the government. It is a matter of creating the right environment for investors as every state has been endowed with abundant number of products and destinations. She said that the Ministry has moved a Cabinet note recommending reduction of infrastructure threshold to INR 50 crore.

At the event, FICCI & YES Bank’s joint publication of the knowledge paper ‘Tourism Infrastructure Investments: Igniting India’s Growth Engine’ was launched. The proposed knowledge paper throws some interesting statistics. As per the report, tourism investment accounted for 5.7% of the total investment in 2016. Over next 10 years the sector will outperform the global economy as tourism investment is forecasted to rise 4.5% p.a. The report would also focus in detail on the various investment projects and opportunities offered by the various state tourism boards.

The state governments are looking for investment in various sectors of tourism including hotels, mega convention centre, wayside amenities, amusement parks, adventure tourism, river cruise, sanitation & civic amenity, etc.

Investor’s Feedback

Shwetank Singh, VP-Development & Asset Management, InterGlobe Hotels
As a group, we have very well invested INR 2,300 crore in growing our presence in the hospitality sector in India. We plan to grow our ibis hotel brand further in Tier-I and key Tier-II Indian cities. We are here to understand what is on offer by the government. It is pleasant to see their refreshing approach towards the investors and the openness. The government officials are doing follow up which is quite a novelty. We are used to chasing them, but it is interesting to be chased by the bureaucrats at times. The progressive nature of the government is very appreciative. The opportunities at Andhra Pradesh seem promising along with few other states.

Rohit Mathur, CEO, Heritage Aviation Pvt. Ltd.
We are a non-scheduled operator with a fleet of 6 helicopters and 2 fixed-wing aircraft. We undertake charter trips and pilgrim tours. We are already operational in Uttarakhand, in talks with the Andhra Pradesh Tourism and Madhya Pradesh Tourism. MP Tourism is keen to commence helicopter services and has given a number of suggestions. This event has given us a possibility of dialogue and interaction with key government officials.

Sandeep Roy, GM-Business Development, Clarks Inn Group of Hotels
The states have a variety of investment opportunities to offer spanning across our sub-brands. As a management company, we look forward to work with the states and explore the niche locations too. We are in talks with the tourism boards of Andhra Pradesh, MP, Maharashtra and Rajasthan.

Madhya Pradesh
The state which has been the frontrunner in tourism promotion and facilitation highlighted the double digit GDP growth for the last four years, standing at 10.2% in FY 2015 – 2016. AK Rajoria, Director, Madhya Pradesh Tourism, highlighted how the Investor Facilitation Desk is facilitating the allotment of land, WSA and heritage properties to private investors along with online and time bound application process for claiming financial incentives. He informed the delegates that the tourism board has increased the number of activities listed as tourism projects. They are assisting with capital investment subsidy for all listed tourism projects. The registration and stamp duty is exempted for government land parcels.

Madhya Pradesh is focusing on water tourism, adventure tourism, film tourism, wildlife experience and wildlife recreation and has inclusive bidding opportunities for real estate developers, hoteliers, tour operators and hospitality service provider. The state has a vision is to build 19,100 additional number of hotel rooms by 2020.

Andhra Pradesh
Post doing a study on the state, hospitality consulting firm – HVS stated that from the existing supply of 7,000 hotel rooms, the state will need 18,150 additional keys by 2025. A in-depth study was done to analyse which kind of room category required in cities. Talking about the development in the state, Mukesh Kumar Meena, Secretary Tourism, Andhra Pradesh, averred that domestic travel has boomed 30% while inbound has recorded 200% growth last year, making Andhra Pradesh the third-most popular state for foreign tourist arrival.

“We can spend up to INR 10 crore on supporting infrastructure and are open to negotiate on the other incentive options. We are also willing to amend or customise policies for assisting investors. 2,000 acres of land bank is available across the state and a new tourism policy is on the anvil to ease the process for investors,” he asserted.

Satpal Maharaj, Tourism Minister, Government of Uttarakhand said that the government is all set to develop the state as a Winter tourism destination by creating world-class infrastructure for skiing and other adventure activities. “The government is planning number of circuits connecting many spiritual destinations like Shatbhi circuit, Vaishnav circuit, holy Devdas circuit, Nagraj circuit, etc. We will give big support for spiritual tourism,” he stated.

At the presentations on day two, this was the only proactive state at the event which distributed updated brochures and soft copies highlighting the investment possibilities. Even if any investors couldn’t meet the state tourism board, he had the concerned information available at the click of a button.

The state ranks ninth in ease of doing business. On the development front, three new airstrips in the state are likely to be operational in the coming years. Meenakshi Sundaram, Secretary Tourism, Uttarakhand, elaborated the investment options in wayside amenities, wildlife, adventure, wellness tourism, etc. He mentioned that the new Tourism Policy will be announced soon.

Planning to develop tourism circuits such as sea fort, Buddhist, Ramayana, etc., Ashutosh Rathod, Director Tourism and Joint Managing Director, Maharashtra Tourism Development Corporation, said that the state will be creating meditation zones by the coastline. They have also identified 14 top destinations with religious significance and at the border. 35 priority projects have been shortlisted at niche locations for investors.

The state is presently working on its cruise tourism and beachside policy. Simultaneously, they are also studying the tourism policies of other states and adding on the positives to their kitty.

West Bengal
West Bengal has increased the tourism budget allocation five times over the past five years. Even all major domestic airlines have doubled their flight frequency in the last two years, stated Prasenjit Das, Deputy Resident Commissioner, West Bengal Tourism. He added that the 720 km long coastline can serve as a potential route for commencing cruises between India and Singapore from the two operational ports of Kolkata and Haldia. A third new sea port is coming up at Sagar Island and the facilities at Kolkata port passenger terminal are being revamped.

Pawan Jain, Joint Director, Rajasthan Tourism started off by saying that such events should be capitalised by sharing the demands and requirements of investors beforehand with the state governments so that they are prepared.

Apart from showcasing investment opportunities in heritage hotels, ropeways, MICE, adventure sports, amusement parks and cruise tourism, the government has also identified over 1,200 acres of government land for development of tourism units.

Talking about hotel supply, he added that the state features 75% of the total number of heritage hotels in India and over 60,000 hotel rooms with an annual increase of 2,500. The 450 Bed & Breakfast establishments are also showing an increasing trend.

The state promises a focused policy to attract investment, time-bound single window clearance for tourism projects, simplified procedures for land allotment and discounted fee for heritage hotel bar licenses amongst others.
Post Your commentsPOST YOUR COMMENT
* Name :      
* Email :    
  Website :  
Receive the best of Travel content in your mailbox.
Enter your e-mail ID for our
Weekly e-Newsletter
© Copyright 2015 Saffron Synergies Pvt Ltd