Budget 2022: Travel and tourism sector looks to the FM for revival

During the pandemic, domestic travel and tourism industry saw a spike due to factors like international travel restrictions, increasing disposable incomes, revenge travel, etc. The industry feels that the Union Budget 2022 offers the government a significant opportunity to create a stimulus towards revival. 

"The last two years have highlighted the power of the domestic market and towards unlocking the full potential of domestic tourism, we look forward to budgetary focus on infrastructure development, technology and health-safety across airports/aviation, road, rail and waterways," Madhavan Menon, Managing Director, Thomas Cook India Group said.

Menon said India's waterways offer a large underleveraged potential that includes sea and river cruising opportunities and cascading employment benefits to the catchment areas.  

"Empowering our global embassies, export (zero-rated) status to the inbound tour business and deeper marketing investment is much needed to kick start inbound demand and ensure competitive viability when compared to our neighbours in the region," he said.

The Thomas Cook India Group expects rationalisation of taxes (including a complete GST tax holiday, exemption of TCS levy on overseas holiday packages and reduction in indirect taxes), removal of SEIS benefit capping of Rs. 5 crore and introduction of soft loans with favourable terms as a stimulant to enable the sector to get back on its feet. 

"This will equally harness its force multiplier impact towards GDP contribution, employment generation/ skill development - much needed as the Country heads towards recovery, revival and growth," he said.

Online travel portal ixigo is of the opinion that demand and search queries for travel have been slowly climbing in the last two quarters and the industry is regaining momentum. The industry feels certain provisions by the government can help bolster the industry back to pre-COVID-19 levels sooner. 

"We are seeing the true bounce-back potential of domestic tourism which saw a sharp rise in tourist flow in 2021 due to pent-up demand, vaccine roll-out, and revenge tourism. . We have noticed the rise of domestic air travel from tier 2 and 3 towns and budgetary focus on the development of infrastructure, technology, and safety measures of existing and new airports in Tier 2 & 3 cities will help boost tourism by improving connectivity with those cities where trains or buses may be the only connectivity today," Aloke Bajpai, Group CEO & Co-founder, ixigo said.

Industry players are looking forward to the government strategising a sustainable long-term plan to help revive international travel which is currently disrupted by ongoing waves. 

"The introduction of innovative initiatives like the 'sandbox schemes' currently being followed by countries like Thailand and Indonesia will help India build a more resilient tourism economy going forward. We also expect the upcoming budget to allot incentives for domestic tourism and promote it within the country," Bajpai said.

Tax breaks and waivers for the airline sector will also help aid faster recovery of the industry, he added. The travel industry will also see a revival once inter-city mobility picks up. 

"The intercity mobility segment has seen a consistent month-on-month growth after the 2nd wave. The third wave's influence has been felt, and some trip plans have been postponed, particularly in states with higher levels of dispersion. The silver lining for next year is that, because of the government of India's rapid vaccination effort, travellers are confident in travelling to locations, and the industry is looking forward to normalcy as COVID daily cases reduce again," said Manish Rathi, Founder & CEO, IntrCity, a smart mobility provider.

"We are hopeful that in the forthcoming budget, stronger infrastructure initiatives will be incorporated into the National Infrastructure Pipeline. The mobility needs of smart cities will lead to the next wave of inter-city mobility growth and enable smooth connectivity with the nearest metro city, besides connectivity between those cities," he added.

Also read: Budget 2022: Companies want FM to enable foreign listing

Also read: Will Budget 2022 give wings to aviation sector?