Industry welcomes more allocation but questions surprise cut in overseas promotions, ET TravelWorld

In the latest budget announcement, the Ministry of Tourism revealed its budget allocation for the fiscal year 2024-2025, aiming to boost the tourism sector and enhance infrastructure across the country. The total budget for the Ministry of Tourism stands at INR 2449.62 crores; however, there has been major change in allocation for promotions and publicity of tourism domestically and internationally.

A substantial portion of the budget has been earmarked for various central sector schemes and projects aimed at enhancing tourism infrastructure and promotion. Under the category of Tourism Infrastructure, projects like the Integrated Development of Tourist Circuits around specific themes (Swadesh Darshan) and Pilgrimage Rejuvenation and Spiritual, Heritage Augmentation Drive (PRASHAD) have received significant allocations, totaling INR 2080.03 crores.

Comparing this to the previous year’s allocation of INR 1939.22 crores, it reflects a notable increase in funding, highlighting the government’s emphasis on developing tourist circuits and rejuvenating pilgrimage sites.

However, there have been noticeable shifts in budget allocations for Promotion and Publicity, with a drastic cut in overseas promotion and publicity in the recently announced budget for 2024-2025. In the previous year, the allocation for Overseas Promotion and Publicity stood at INR 167 crores, which was revised to INR 100 crores. Shockingly, in the 2024-2025 budget, this allocation has been significantly reduced to just INR 3.02 crores. This drastic reduction underscores the government’s decision to prioritize domestic tourism promotion over international outreach.

On the other hand, the budget for Domestic Promotion and Publicity, including Market Development Assistance, has seen a substantial increase from INR 75 crores in the previous year to INR 176.97 crores for 2024-2025. This significant boost in funding highlights the government’s intention to encourage domestic tourism and promote travel within the country.

Furthermore, there is decrease in budget allocated for Training and Skill Development, with allocations made for capacity-building initiatives and assistance to IHMS, FCIs, IITTM, and NIWS. While the total allocation for Training and Skill Development has decreased compared to the previous year, standing at INR 84.05 crores for 2024-2025, the Champion Services Sector Scheme has been totally washed off with negligible budget allocation of INR 0.03 crore in comprising to 196 crore used in the revised 2023-2024 budget.

Sharing his reaction on the drastic cut in the budget for overseas promotion and publicity, Naveen Kundu, Managing Director, Ebixcash Travel services in conversation with ETTravelWorld said, “Are we doing justice to tourism by just keeping INR 3 crores allocation for overseas promotion that too at a time when we are taking big steps in asking every Indian abroad to send 5 tourists to India. If we have to push cultural, spiritual and heritage tourism, this budget has to be at least to the tune of 5 -7 million dollars. A mediocre tour operator offering tourism products to foreign operators often spends more then this.”

Whereas, Sabina Chopra, Co-Founder & COO, Corporate Travel & Head Industry Relations at Yatra.com welcomed governemnt’s focus on domestic tourism. “The interim budget seems to be in the right direction for the domestic tourism industry. There is growing fervour to travel and explore amongst the Indians, most importantly the middle class. With State Ministries encouraged to develop individual tourism landscape, India is poised to become a diverse and attractive destination for global and domestic travellers. We hoped that income tax slab relaxation was covered in the interim budget. This would have ensured higher disposable income in the hands of middle class leading to further travel consumption impetus,” she said.

Ayyappan R, CEO, Cleartrip said, “Initiatives like UDAN concurrently improve regional connectivity, fostering accessibility to people. The inflow of investments towards road transport and railways will further aid in greater connectivity and affordable travel options, especially for the mid-income population. In terms of travel trends, the surge in leisure and spiritual tourism, coupled with an increased consumer desire to invest in travel and exploration will add to the sector’s growth.”