PM’s appeal to avoid foreign trips to hit travel industry, boost domestic tourism: Experts

Prime Minister Narendra Modi’s appeal to citizens to avoid foreign travel amid the West Asia crisis will impact the travel industry and already summer overseas inquiries are down by as much as 15 per cent, industry and analysts said. However, it could boost domestic tourism, experts opined.

On Sunday (May 10), Modi had called for the judicious use of fuel and postponement of gold purchases and foreign travel, among other measures to strengthen the economy, while emphasising that the Centre is trying to shield people from the adverse impact of the Iran war.

Short to medium term impact

Modi’s request is set to hit the peak season for outbound tourism, when affluent families seek cooler locations in Europe and Australia, during school holidays that run from April to June, a report in news agency Reuters said on Wednesday (May 13).

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"The prime minister has a great following, and people sometimes take his advice very seriously ... they may postpone it to next year," Ravi Gosain, president of the Indian Association of Tour Operators, with more than 2,000 members, was quoted as saying in the report.

"We (had) already ⁠seen a 10 per cent to 15 per cent reduction in inquiries or business for this summer season," he added.

This will definitely have an impact in the short to medium term, said Kranthi Bathini, director of equity strategy at WealthMills Securities. "But if there is a cool-off in crude oil prices, we can see a rebound," he added.

Will it boost domestic tourism?

Sunil Kumar, president of the Travel Agents ⁠Association of India, EaseMyTrip, and the Hotels Association of India (HAI) feel Modi’s call could help boost domestic tourism.

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The Hotel Association of India has welcomed Modi's appeal to the citizens to postpone unnecessary foreign travel, saying the sentiment will help boost domestic tourism, thus building foreign exchange reserves.

KB Kachru, President, HAI said in the current volatile geopolitical environment, a stronger domestic tourism will contribute towards conserving foreign exchange while building a more resilient and self-reliant travel ecosystem.

"At the same time, there is also the need for the government to encourage and support inbound travel, which will in turn help build foreign exchange reserves for the country," he stated.

Employment generation

According to Kachru, increased domestic travel is expected to boost demand for hotels, resorts, local destinations, and regional tourism experiences across the country.

It can further strengthen employment generation by supporting small tourism businesses and accelerate growth in tier II and tier III destinations.

"India's domestic travel market has emerged as one of the strongest demand engines globally, driving hospitality growth, employment generation and infrastructure utilisation across metros as well as Tier 2 and Tier 3 destinations," the HAI President said.