Hyderabad: Every year World Tourism Day highlights the importance of tourism in preserving and promoting cultural heritage all around the world.
Organised annually by the United Nations World Tourism Organisation to highlight the importance of tourism since 1980, the day aims to highlight the global significance of tourism as a tool for global development and cultural enlightenment.
On this World Tourism Day, the COVID-19 pandemic represents an opportunity to rethink the future of the tourism sector, including how it contributes to the sustainable development goals, through its social, cultural, political, and economic value.
Tourism can eventually help us move beyond the pandemic, by bringing people together and promoting solidarity and trust – crucial ingredients in advancing the global cooperation so urgently needed at this time.
First time as Joint hosts
For the first time in the 40 year history of World Tourism Day, the 2020 official celebration will be hosted by a group of countries and not a single UNWTO Member State. The cross-border cooperation of the Mercosur nations (Argentina, Brazil, Paraguay, Uruguay, plus Chile who has observer status) reflects the current need for international solidarity and cooperation.
This is especially true for tourism, working together towards a common goal.
The genesis of World Tourism Day
In a special assembly held in Mexico on 27 September 1970 by the International Union of Official Travel Organisation (IUOTO), the nations adopted the Statues of World Tourism Organisation. Then, UNWTO decided in late September 1979 to institute World Tourism Day.
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Henceforth, it was first celebrated on 27 September 1980.
Since the date coincided with an important milestone in world tourism i.e. the anniversary of the adoption of the UNWTO Statutes on and the date is considered appropriate because it comes at the end of the high tourist season in the northern hemisphere and the start of the tourist season in the southern hemisphere.
It is from then, the day is celebrated every year with different themes.
Tourism: A major employment sector
It is estimated that tourism employs one in every ten people on Earth and because of the pandemic, 100-120 million direct tourism jobs are at risk.
Tourism is a lifeline, offering young people a chance to earn a living without having to migrate and it is estimated that young people in rural communities are three times more likely to be unemployed.
The tourism industry is labour-intensive whereas accommodation and food services subsectors alone provide employment for 144 million workers worldwide.
A majority of tourism enterprises are micro, small and medium sized enterprises (MSME) of less than 50 employees.
However, in the accommodation and food services subsectors, 51 million businesses are facing an extraordinarily difficult business environment with major impacts on employment opportunities due to the pandemic.
Tourism in India
India ranks 34th (of 140 Countries) in the Travel and Tourism Competitiveness index (TTCI) 2019 as claimed by the World Economic Forum and receives 11 million foreign tourists, which is small compared to its size.
Tourism is a potentially large employment generator besides being a significant source of foreign exchange for the country. As of 2019, 4.2 crore jobs were created in the tourism sector in India, which was 8.1 per cent of the total employment in the country.
The number is expected to rise by two per cent annum to 52.3 million jobs by 2028.
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The tourism industry accounts for 9.2 per cent of India's Gross Domestic Product (GDP) and employs 8 per cent of the population of the country. The total foreign exchange contribution made by the tourism sector is $28 billion.
Impact of COVID on tourism in India
According to a study by industry chamber CII and hospitality consulting firm Hotelivate, the Indian travel and tourism industry and the entire value chain linked to the sector is likely to lose around Rs 5 lakh crore or $65.57 billion.
The pandemic has affected almost every sector of the Indian economy, perhaps the travel, tourism and hospitality sectors have been the most affected. According to the World Travel and Tourism Council, nearly 42 million jobs in the tourism and hospitality sector will be at risk in India.
Indian tourism and hospitality sector, which is badly hit by COVID-19, is staring at a potential job loss of around 38 million, which is around 70% of the total workforce, leading accounting and audit firm KPMG says.
Government initiatives to revive tourism sector post-COVID in India
The government of India has announced various stimulus packages in order to revive tourism sector with the RBI extending moratorium on term loans till 31st August 2020.
The government has further announced Atmanirbhar Bharat Package vide which Rs 3 lakh crore collateral-free automatic loan has been made available for MSMEs. The loan will have 4-year tenure and will have a 12-month moratorium.
It also waived off PF contribution for three months for organizations with less than 100 pax and 90 per cent employees having a salary below Rs.15000.
Under the Atmanirbhar Bharat package, the PF contribution of both employer and employee has been reduced to 10 per cent each from the existing 12 per cent each for all establishments covered by EPFO for the next three months i.e. up to September 2020.
Besides this, the deferment of TCS upto October 2020 is allowed. Return filing deferred for three months with no penal interest for companies up to 5 Crore.
Trends in Average annual occupancy in hotels rates in India
The impact on revenue streams due to the shutdown and slowdown will last till October and the current trends indicate only 30 per cent occupancy in hotels till the start of the next year as opposed to an average annual occupancy of 68 per cent.
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According to the study, occupancy was at its peak in January this year at 80 per cent followed by February at 70 per cent, dipping to 45 per cent in March and then to the lowest at 7 per cent in April.
In May, June, July and August occupancies were at 10 per cent, 12 per cent, 15 per cent and 22 per cent, respectively.
The hotels will likely see 80 per cent to 85 per cent erosion in revenue streams as per the report. The estimated revenue loss for hotels this year for both branded and unbranded segments is estimated to be at $19.13 billion.
The estimated loss for travel agents this year for both online and offline mode is $4.77 billion.
The estimation of losses is in the worst-case scenario. However, in the best-case scenario, the industry revenue will improve by 10 per cent to 15 per cent.
The CII-Hotelivate study projected that in September occupancy will be at 25 per cent, 28 per cent in October, 30 per cent in November and 35 per cent in December.
The revival of the Tourism sector
According to the latest analysis from the World Tourism Organization (UNWTO), as of early September, 53 per cent of destinations had eased travel restrictions. However, many governments remain cautious.
The report also sheds light on how the lockdowns introduced during the first half of the year have had a massive impact on international tourism with sharp and sudden fall in arrivals placing millions of jobs and businesses at risk.
