Niche Tourism

(A growth Factor of Service Industry in India)

A Service sector is one of the important parts of Indian economic development. India’s service sector contributes to about 61 per cent of the country’s gross domestic product (GDP), 35 per cent of employment, a quarter of the total trade, and over half of the foreign investment inflows. Its contribution to the Indian economy is particularly significant, with regard to employment potential and impact on national income. This sector covers a wide range of activities, such as transportation, tourism, communication, trading, finances, real estate and health, among others. The services industry provides massive business prospects to investors. Without the sector’s capacity to generate revenue, it would be difficult for the Indian economy.

The Indian tourism and hospitality industry has emerged as one of the key industries driving growth of the service sector in India. Indian tourism industry is thriving due to an increase in foreign tourist arrivals and greater number of Indians travelling to domestic destinations than before. In the past few years the real growth has come from within the domestic sector as around 30 million Indians travel within the country in a year. Strong growth in per capita income, rising young population coupled with changing lifestyles are leading to greater expenditure on leisure services. Hotels are an important component of the tourism product. They contribute in the overall tourism experience through the standards of facilities and services offered by them. The fortunes of the hospitality industry have always been linked to the prospects of the tourism industry and tourism is the foremost demand driver of the industry. Travel & tourism’s contribution to capital investment is projected to grow at 6.5 per cent per annual during 2013-2023, above the global average of five per cent. The tourism policy of Government of India aims at speedy implementation of tourism projects, development of integrated tourism circuits, special capacity building in the hospitality sector and new marketing strategies.

Trends in contribution of tourism to service sector

Trends in the growth rate of service sector, growth rate of tourism and hotel industry and the relative share of this sector in the service sector show that the share has increased continuously and according to the latest estimates this sector is contributing 25 percent to the service sector.

Trends in Tourism contribution to service sectors

Source: Central Statistical Office (CSO)

A Service sector has grown at a growth rate of 5.5 percent in 2000-01 and at 6.5 in 2012-13. The trend in tourism contribution to service sectors has increased substantially from 2000-01 to 2012-13. It increased from 14.6 to 25.1 %. This includes trade, hotels, and restaurants.

Present scenario of tourism industry

Tourism can play an important and effective role in achieving the growth with equity objectives which we have set for ourselves. Government of India recognized tourism sector as one of the

important contributors to employment generation and economic growth.

India has a diverse portfolio of niche tourism products – cruises, adventure, medical, wellness, sports, MICE, eco-tourism, film, rural and religious tourism. India is the 16th most visited country in the world, with a share of 1.56% in the world’s tourism receipts. India offers geographical diversity, attractive beaches, 30 World Heritage Sites and 25 bio-geographic zones.

Tourism and hospitality, a key sector of the Indian economy, plays a key role in the growth of Brand India. Globally, tourism ranks fifth as an export category after fuels, chemicals, food and automotive products.

India’s travel and tourism economy is poised to grow 7.5% in 2015 over last year, exceeding the 6.9% growth that the global forum has predicted for the South Asian region.

As per planning commission an investment of Rs. 10 Lakhs creates 78 jobs in tourism sector while same generates just 18 jobs in the manufacturing and 45 in the agriculture sector.

In 2014, the industry contributed Rs7.64 trillion and 36.7 million jobs to the Indian economy. By the end of 2015, the travel and tourism sector will contribute Rs 8.22 trillion or 7% of India’s gross domestic product (GDP) and 37.4 million jobs—almost 9% of total employment. There will be 43 million jobs in travel and tourism sector in India by 2022. In total, nearly 266 million jobs were supported by Travel & Tourism in 2013 - 1 in 11 of all jobs in the world.

Almost 750000 people in India are employed in hotels within India. Around 1 lakh people are employed in motels on highways. The Employment in hotel industry is forecasted to increase to 2.8-3.5 million by 2020.80% of the manpower in employed in key hotel functions such as F&B, front office and housekeeping. Most of them are young and less than 40 years of age.

Requirement Supply Gap in Tourism Sector

Source: http://www.tourism.gov.in/writereaddata/Uploaded/ImpDoc/020220120146055.pdf

Over all contribution of India’s travel and tourism sector to the overall economy is 6.7% of GDP, against a global average of 9.8%

Inbound tourism in 2014 reached 7.46 million. Number of Domestic Tourist Visits to all states/UTs were-1145 million in 2013 showing a growth rate of 9.6% over the previous year.

Future prospects of Indian tourism industry

According to the latest Tourism Satellite Accounting (TSA) research, released by the World Travel and Tourism Council (WTTC)

a) The demand for travel and tourism in India is expected to grow by 8.2 per cent between 2010 and 2020 and will place India at the third position in the world.

b) According to WTTC forecasts, travel and tourism has the potential to contribute 46 million jobs to the Indian economy by 2025.

c) The total contribution of Travel & Tourism to GDP is forecast to rise by 7.0% pa to INR13,983.0bn by 2024 (6.8% of GDP).

d) The report forecasts India to get capital investment worth INR 3,981.3billion in the travel and tourism sector in 2024.

Developing Niche Tourism Segments in India

With this scope of development in travel and tourism in India there is a need to develop new segments of tourism Industry and there by development of Infrastructure and at the same time preparing manpower resources to cater to the growing niche market of tourism Industry or in a broader term that of service industry.

When developing new markets for Inbound Tourism, there is also a need to develop new products or offerings i.e. developing niche segments. While stressing on the conventional tourism products of heritage and culture, there have been concerted efforts on the part of Indian states to develop Niche Tourism products and destinations around youth tourism, cinematic tourism, rural tourism and health wellness and medical Tourism.

Health and Wellness Tourism:

India could be number one for growth globally in the wellness tourism sector in the next five years, clocking over 20 per cent gains annually through 2017.

Wellness tourism is a USD 439 billion industry worldwide within the USD 3.2 trillion global tourism industry, representing 14 per cent of all tourism spending. India's total wellness market to surpass USD 18 billion in the next four years. Luxury Wellness Tourism segment is estimated to grow nearly 50 per cent faster than global tourism by 2017.

Medical Tourism:

Many of the research shows the medical treatment cost in India is low by an average of 40 to 60%, when compared to western standards. This is the cost of full package which includes accommodation, cost of treatment and accessibility (international).As the popular slogan that goes around in the industry says, India offers “First World treatment at Third World prices.” India produces almost 28,000 to 30,000 doctors and nurses each year and is known worldwide for its competent and qualified professionals in this field.

India was one of the first countries to recognize the potential of medical tourism. From the year 2009 to 2011 the number of medical tourists in India has grown by 30%. It is estimated that by the end of year 2015, India will receive nearly half a Million medical tourists annually.

The medical tourism market in India is projected to hit US$ 3.9 billion mark this year having grown at a compounded annual growth rate (CAGR) of 27 per cent over the last three years, according to a joint report by FICCI and KPMG. Also, inflow of medical tourists is expected to cross 320 million by 2015 compared with 85 million in 2012. The tourism industry is also started with E-visa scheme which is expected to double the tourist inflow to India.It is utmost important at this stage to strengthen and recognize the super specialty hospitals providing medical facilities and medical tourism facilities by service providers.

Youth Tourism: Indian youth is the largest market of a cross section of travel consumption, ranging from Eco to the luxury of hiring flights for school students. There has been a marked increase in youth travelers as compared to youth tourists around the world. The youth now wants to explore, to see the world. Young independent travelers tend to travel more frequently and for longer periods. Mumbai alone has seen an increase of 25% each year for the past 5 years in terms of youth travelers. More than ten thousand students travel each year during their summer vacations. According to the World Bank, by 2020, 34% of Indian population will be the youth.

By 2030, the average age of youth in India will be 29years as compared to the 37 in China and USA and 45 in West Europe and Japan. India is and will continue to be the youngest country in the world in the coming decades. Consequently, the number of students and youth travelers are expected to increase exponentially. More than any other market segment, youth and student travellers are leading with innovation and paving the way for responsible tourism.

Cinematic Tourism: The Indian Cinematic industry is one of the fastest growing sectors in the country today and has grown from INR112 billion in 2012 to INR126 billion in 2013, representing a growth rate of 13%. Over the years, the industry’s revenues have grown significantly and the projected size of the industry is estimated to reach INR220 billion by 2018. The Indian Cinema industry is one of the largest producers of cinematographic films in the world with an annual certification of 1,966 films during FY13–14 .Furthermore, India’s favourable regulatory environment and reforms such as 100% Foreign Direct Investment under the automatic route has made the Indian Cinema market more attractive for international corporates, bringing in significant investments.

161 million TV households, 94,067 newspapers (12,511 dailies), close to 2000 multiplexes, 214 million internet users In 2013 the Indian Media & Entertainment (M&E) industry registered a growth of 11.8 per cent over 2012 and touched INR 918 billon. Overall, the industry is expected to register a CAGR of 14.2 percent to touch INR 1785.8 billion by 2018.

The Television sector is projected to command half of the entertainment pie by 2015 as it is estimated to grow at a robust 14.5% cumulatively over the next five years, from an estimated Rs. 30,650 crore in 2010 to Rs. 60,250 crore by 2015. The print sector is projected to grow by 9.6% over the period 2011-15, reaching Rs. 28,200 crore in 2015 from the present Rs. 17,870 crore in 2010. Radio sector is projected to grow at a CAGR of 19.2% over 2011-15, reaching Rs. 2,600 crore in 2015. The total internet user base in India grew to approximately 214 million by end of the year with almost 130 million going online using mobile devices.

Rural Tourism: Tourism growth potential can be harnessed as a strategy for Rural Development. The development of a strong platform around the concept of Rural Tourism is definitely useful for a country like India, where almost 74% of the population resides in its 7 million villages. Across the world the trends of industrialization and development have had an urban centric approach. Alongside, the stresses of urban lifestyles have led to a “counter urbanization” syndrome. This has led to growing interest in the rural areas. At the same time this trend of urbanization has led to falling income levels, lesser job opportunities in the total areas leading to an urbanization syndrome in the rural areas. Rural Tourism is one of the few activities which can provide a solution to these problems. Besides, there are other factors which are shifting the trend towards rural tourism like increasing levels of awareness, growing interest in heritage and culture and improved accessibility, and environmental consciousness. In the developed countries, this has resulted in a new style of tourism of visiting village settings to experience and live a relaxed and healthy lifestyle. This concept has taken the shape of a formal kind of Rural Tourism. It showcase rural life, art, culture and heritage at rural locations and in

villages, which have core competence in art & craft, handloom, and textiles as also an asset base in the natural environment. The intention is to benefit the local community economically and socially as well as enable interaction between tourists and local population for a mutually enriching experience. So far, 153 rural tourism projects in 28 States/Union Territories have been sanctioned by the Ministry of Tourism including 36 rural sites where UNDP has supported for capacity building. Rural Tourism has a multiple forms of tourism in itself as it components

Components of Rural Tourism:

Heritage and Culture (Ethnic Tourism) Learning and Education from natural environment about rural life style, art and culture

(Eco Tourism) Scenic value (Nature Tourism) Religious value (Pilgrim Tourism) Adventure/Sports based activities (Adventure Tourism) Rural/Agrarian life style (Farm Tourism/Agritourism) Rural Cuisine Orchard Tourism

Thus promoting rural tourism in one or the other manner can ultimately help new forms of tourism to grow in India.

RECOMMENDATION by ICSI

Cinematic Tourism

• Cinematic Tourism to be promoted as a niche tourism product both nationally and internationally through strong marketing and promotional strategies.

• Conferences and Expos: Annual event, conference, expo, cinematic tourism Awards and honours, Indian Cinematic Festival to be promoted globally.

• Central compendium for cinematic tourism including government officials, Bollywood person, Trade expert, Trade association member, conducting annual meetings, Cinema shooting permissions and facilitation services through single channel. This body should have branches in all states of India.

• Incredible India campaign to promote Cinematic Tourism.

• Media and Entertainment -To be part of Vocational training, 11 and 12th onward at school level and other Capacity Building and Skill Development Programmes by ministry of Tourism, Govt. of India

• Inviting NRIs to invest in cinematic tourism projects in India

• List and directories should be made of important tourist destinations for Cinema shootings for Hollywood. These directories apart from having list of locations, can have Important Addresses/Contact Details-Technical people, the list of shops to hire equipment for shooting, costume hiring ,ornament hiring ,set decoration, generators, crains etc. with address, their tariff and rates.

• Ministry of Tourism, Govt. of India to facilitate FAM (Familiarisation Trips) through state tourism departments for production houses, to and from India and abroad.

• Ministry of Tourism in collaboration with state tourism departments to develop a separate brochure, other promotional literature material themed on Cinematic Tourism.

• Cinematic Shooting Locations: Each state to choose 9-10 best locations in their state for Media Entertainment Industry (Film, Tele serials, Ad Films shootings and events)

• Development of Cinematic Tourism infrastructure at these Identified places.(Accomodation, accessibility and local governance )

• Each State to have a strong, updated single window clearance system under the super Vision of one Nodal Office, for all production houses coming in India for film.

• Talent bank of the state (dance groups, artists, theater artist etc.) should be acknowledge and encouraged by state government by conducting talent hunt shows.

• Talent Hunt at school and college level all over the country.

• ‘Cinematic Art Gallery’/’Cinematic Souvenirs Gallery’ at different places in the state.

Increase number of guides, linguist guides (viz. French /Spanish /Russian/German /Chinese /Korean /Thai etc.) by conducting guide training programmes on regular basis.

Medical tourism

Medical Tourism to be promoted as a niche tourism product both nationally and internationally through strong marketing and promotional strategies.

Enhanced participation of stakeholders in road shows and international fairs/overseas events.

Approval of Medical Tourism Service Facilitators by Ministry of Tourism Government of India.

Conference in key markets to forge networking with Global Health Insurance companies and Referral points.

Coordinating implementation of guidelines for Accreditation of Wellness Centers across India.

Ministry of tourism to give national awards to Medical Tourism facilitators and super specialty hospitals through annual conference.

Special tourist information Centre in the premises of Super specialty hospital. Trade experts /Medical tourism facilitator list should on the website of Ministry of

Tourism. Bring in maximum number of service providers under MOT, GOI recognition through

publicity, road shows, travel marts etc. Grant of approval / recognition to medical service providers within a prescribed time

frame and ensure prompt settlement of their claims/grievances. Ministry of Tourism to recognise at national level local traditional health care practices of

respective states with the help of state government to be provided to the tourist coming for health tourism and naturopathy.

Youth Tourism

Ministry of Tourism needs to evolve policies and programmes that lead to creation of strong HRD infrastructure for the tourism sector. This requires, besides creating physical infrastructure, well-planned syllabus reviewed at regular intervals, good remuneration to attract and retain quality faculty/ trainers, generating opportunities for faculty to enhance in their capabilities, close interaction with industry for maintaining the right balance between theory and contemporary industry practices.

Ministry of tourism to launch Campaign/appeal and promote youth tourism at national level.

Campaign to be run on national level in different parts of India Identifying selective cities in each region of our country with special emphasis on North east

Organising various activities of Tourism quiz contests, Tourism awareness Talks, Tourism essay and slogan writing competitions, conferences in different regions of India for promotion of youth tourism, exhibiting youth talent for promotion of Indian Tourism, Communication Idol contest for selecting the youth who could anchor and give their voice for promotion of youth tourism.

Involving media entertainment industry-celebrities from promotion of youth tourism Motivational cum awareness talk for tourism and vocational education in +2 schools and

college. States/UT to organize Swatch Bharat campaign/awareness camps, involving youth to

participate. Industry-students interface for skills development and capacity building through

workshops/events/seminars sponsored by Ministry of Tourism, state department, and conducted by ICSI in collaboration with trade associations.

State/UT government to generate the data of schools and colleges and making a schedule/planner to give talk/seminars/workshops for whole year in each state.

Rural Tourism:

• Incredible India campaign to promote Rural and Heritage Tourism.

• States to identify 4-5 villages having prospects to be developed for rural heritage tourism

• Ministry of Tourism, government of India to recognise these as National Rural Heritage village.

• On the patterns of Chokhi Dhani these village then can promote their local and regional cuisine, folk dance, folk songs, and handicraft.

• Ministry of Tourism, Govt. of India can ask for a proposal of forming rural circuits all over India for Integrated rural tourism development. For example North India Rural Tourism circuit, North East India Rural Tourism circuit, West India Circuit, South India Circuit.

• Developing infrastructure at rural tourism site for tourist activities, rural accommodation, rural cuisine, heritage hotels, home stays etc.

• Rural Tourism can help in providing employment and entrepreneurship for localities. Ministry of Tourism, Govt. of India along with finance ministry of India to help in getting these opportunities to the rural youth.

Job Opportunities and Entrepreneurship avenues in Rural Tourism

1. Rural Accommodation-Rural Youth Hostels/Rural Bed and Breakfast establishments2. Rural Tourism Infrastructure development3. Rural Tourism Guide4. Rural Destination Management Company5. Rural Restaurants/Food Joints/Food Outlets6. Animal Rides/Taming Animals/Ranch, farms, cattle lodging7. Tourist Campsites8. Houseboats9. Camping equipments Hire10. Boat stations11. Dance and Theatre Group12. Photographic Safaris13. Bird Watching Tours14. Adventure sports15. Desert survival courses

16. Fishing camps17. Craft Factory18. Craft Outlets19. Ayurvedic Centres/Traditional Healing Centres-Medicines20. Theme Parks/Biosphere Reserve /Botanical Gardens21. Gathering Products and Tracking Wildlife22. Rural Museums23. Silk moths/Honeybees/Butterflies/Snake/Reptiles breeding farm24. Supply of firewood to camps/lodges/farm houses25. Waste collection from camps/lodges/hostels etc.26. Cleanliness and Hygiene Services 27. Thatching services28. Supply of natural Minerals29. Bottling and supply of spring or natural water30. Supply of traditional food items31. Supply of decorative and ornamental plants/Floriculture32. Horticulture and Herbal cultivation/Organic Farming33. Landscaping34. Wild life consultancy35. Rural Heritage conservation36. Rural Tourism web blogging/Rural Tourism Marketing and Promotion37. Dairy Processing38. Eco Tourism based building material and Interior development

India has much potential to explore. Tourism being the strongest part of Service Industry need to be planned in a very progressive and innovative manner by developing alternative tourism and adapting active promotional strategies. Now is the time when our new tourism policy is coming we need not to just plan but to regressly implement the plans into action and to actually see their positive results in terms of overall growth in future.

Sources:

tourism.gov.in/.../Incredible%20India%20final%2021-7-2014%20english.

www.wttc.org/-/media/files/reports/.../country%20reports/india2014.pdf

http://www.academia.edu/6757989/GROWTH_AND_PROSPECTS_FOR_SERVICE_SECTOR_IN_GLOBALIZED_ECONOMY_A_STUDY_OF_INDIAN_TOURISM_INDUSTRY_INTRODUCTION

FICCI Frames 2014 KPMG report.

http://tourism.gov.in/TourismDivision/AboutScheme.aspx?Name=Tourism%20Infrastructure%20Development&CID=66&INO=6

http://www.incredibleindia.org/en/trade-product/products/rural-tourism

http://www.hospitalityindia.com/hospitality-industry-in-india.htm