FAITH revises upwards loss guidance for Indian tourism industry to Rs 15 lakh crore

Federation of Associations in Indian Tourism & Hospitality (FAITH), the policy federation of all the national associations representing the tourism, travel and hospitality industry of India including FHRAI, HAI, IATO and others said on Monday it has revised upwards its value at risk guidance to Indian tourism to Rs 15 lakh crore.

FAITH’s first guidance which was calculated and was shared with the government in March 2020 had put tourism’s economic value at risk at Rs 5 lakh crore from the Covid pandemic. FAITH revised this further during the quarter as the situation deteriorated and the value at risk was put at Rs 10 lakh crores. This has been revised again to touch a value at risk of upto Rs 15 lakh crores in terms of the economic output of tourism in India, the federation said.

FAITH said given the way the virus is progressing, tourism supply chains have broken down in India across all its key inbound, domestic and outbound markets and are not expected to recover for the next five months too taking the total impact to a minimum of 9 months starting from March this year.

The direct and indirect economic impact of the tourism industry in India is approximately estimated at 10% of India’s GDP. This roughly puts the full year economic multiplier value of tourism in India at Rs 20 lakh crore, FAITH said and added that this value covers the whole tourism value chain from airlines, travel agents, hotels, tour operators, tourism destinations, restaurants, tourist transportation and tourist guides. Each of these segments of tourism is non – performing or under performing and will stay that way for many months of this year.

FAITH said non performance is evident across all segments of tourism ranging from pending refunds for travel agents, shut down or vacant hotels and restaurants, no order pipelines for tour operators to laid off or leave without pay staff and managers.

The federation said a tourism fund which can be used by tourism enterprises in India for taking care of their employees, a multi-year moratorium by RBI on principal and interest payments by tourism, travel and hospitality businesses, and an immediate full year waiver of all central and state statutory liabilities are immediately critical measures for tourism businesses.

FAITH said it has already raised requests over the past five months to the prime minister, the finance minister, to 28 chief ministers, to RBI, Niti Aayog, ministries of aviation, commerce, finance and to more than 600 parliamentarians and is closely in coordination with ministry of tourism.

It said it has also requested the parliamentarians to raise the question ‘why not tourism’ for sector specific support as the tourism industry contributes to pan India jobs across urban and rural areas, and towards forex , and IT & GST collections.

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