The Indian Association of Tour Operators (IATO), India’s apex body of inbound tour operators, has called for urgent government intervention as Foreign Tourist Arrivals (FTAs) continue to struggle, remaining significantly below pre-pandemic levels. Despite the revival of domestic and outbound tourism, FTAs have yet to see a meaningful recovery, posing challenges for the inbound tourism sector.
IATO President, Rajiv Mehra, emphasised the pressing need for government assistance, citing the lack of budgetary support for international publicity and the withdrawal of incentives for tour operators. “In 2018 and 2019, India saw 10.56 million and 10.93 million foreign tourist arrivals respectively. However, in 2023, the figure was only 9.23 million, and this year we expect at best a modest 7-9 per cent growth over 2019 levels,” said Mehra.
While domestic and outbound travel has surged due to pent-up demand and attractive incentives like visa fee waivers from foreign destinations, inbound tourism has lagged behind. Competing countries have attracted tourists through such incentives, while India’s lack of similar measures has stunted growth in FTAs from key source markets, including the UK, USA, Canada, Germany, Australia, France, and Russia.
Mehra pointed out the economic potential lost due to the decline in FTAs. “Travel and tourism created 79.86 million jobs (direct and indirect) and contributed 5.19 per cent to India’s GDP in 2019-2020. In terms of foreign exchange, tourism earned USD 7 billion in 2020. The current situation is a huge opportunity lost for the country.”
To revive FTAs, IATO has proposed several measures. The association is urging the government to restore, and ideally increase, the budget for international promotion, including electronic and print advertisements and roadshows in key markets abroad. Additionally, Mehra advocated for the introduction of a Production Linked Incentive (PLI) scheme for tour operators, similar to that in the manufacturing sector, to boost foreign exchange earnings. A visa fee waiver for international tourists is also being proposed to make India a more attractive destination and offset the lost revenue through increased tourist arrivals.With these measures, IATO believes India can restore its position as a top destination for foreign tourists and regain the economic benefits that come with a thriving inbound tourism sector.
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