Tourism takes focus in Modi's Budget, positive for hospitality, allied sectors

Focus on tourism in Budget 2024 positive for hospitality and adjacent sectors

Highlights

·         Rising economic stature, rich and diverse heritage provides immense potential

·         Govt to provide interest free loans to States for developing tourist centres

·         Govt to improve port connectivity and boost infrastructure to develop island tourism

·         Positive for hotel companies and travel related industries

Since tourism has huge potential for job creation, it has found mention in the Union Budget for the second consecutive time. Tourism industry contributes about 7-8 percent of GDP and the development of tourism would generate a multiplier effect in boosting income levels and also generate foreign currency income. India with its diverse culture and strong heritage offers lot of potential to develop tourism.

India is currently the fastest growing economy and fifth largest in the world. Hence, there have been increasing business as well as conference related tourism. India has been hosting important global events like G20 and with the rising economic prowess such events are expected to increase. Moreover, tourism now contributes important portion of consumer spending as rising incomes have created aspirations for travel.

Union Government will provide long term interest free loans to States on a matching basis for development of iconic tourist centres and promoting tourism. Providing interest free loan to States for infrastructure development has translated into huge support for States to take infrastructure development and it would go a long way in development of tourism as well. Union Government would encourage states to brand and market tourist centres at global stage and also provide a framework for rating of the centres based on quality of facilities and services provided.

Union Government would also help in developing spiritual tourism. Case in point being the recent unveiling of the grand Ram Temple in Ayodhya (the birthland of God Shree Ram) which is expected to pull in religious devotees not only from India but also abroad.

Government would also develop islands (like Lakshadweep) by undertaking projects for port connectivity, boosting tourism infrastructure as well as providing amenities. Many Indian travellers who prefer holidaying on beach locations abroad as well as foreign tourists, would be attracted to beach locations once they have better connectivity and amenities.

The budget’s focus to develop and promote tourism is positive for hotel players like Indian Hotels, SAMHI Hotels, Lemon Tree Hotels, Kamat Hotels as well as tourism related companies like Safari Industries and VIP Industries.