Skift Take

While the future of India’s travel and tourism sector looks promising, the reality right now is a bit different and that’s exactly what the World Economic Forum’s index reflects.

Peden Doma Bhutia

India has experienced a significant drop in the World Economic Forum’s travel and tourism rankings since 2019, falling 10 places to the 39th position. This decline has come despite the sector’s overall growth and the nation’s natural and cultural assets.

The index comes out every two years and evaluates 119 countries on a range of tourism development factors.

India showed strong gains in the index since 2021, but the comparison is to 2019 shows it has more ground to make up. India came in behind China and Brazil. Among the world’s top 10 economies, India had the sharpest decline, followed by the UK, which slipped three spots to seventh.

What’s India Missing?

India’s travel and tourism sector remains the largest in South Asia, but the report identifies critical weaknesses. These include Inadequate transport, information technology, infrastructure and tourist facilities along with a challenging business environment.

The report points out that India’s tourism policies, air-transport infrastructure, and tourist service facilities lag significantly, despite high scores in price competitiveness and cultural and natural resources.

Despite having a diverse culture and rich architectural heritage, according to the latest available figure statistic of 2022, India held only 1% share of the international inbound tourism market.

Inadequate Infrastructure

Although there has been growth in hotels, restaurants, first aid, hygiene facilities and amenities, the tourism ministry last year highlighted several issues in a report of tourist destinations: It pointed to inadequate infrastructure and poor connectivity, safety and security, non-availability of skilled manpower, inadequate promotion and marketing and poor hygiene and sanitation.

“There is an inherent need to further improve the country’s tourism infrastructure including accommodation, transport, and information and communication facilities,” the ministry’s report stated.

Announcing India’s Union Budget for the fiscal year 2024-2025, finance minister Nirmala Sitharaman earlier this year announced a framework for rating iconic tourist destinations based on the quality of facilities they offer. She said states would receive long-term interest-free loans to develop these destinations.

Overseas Tourism Promotion

Another blow to the Indian tourism sector in this fiscal budget was the slashing of the global tourism promotion budget by 97% to just INR 30 million ($361,000).

There has also been a significant 60% reduction in the budgetary allocation for the regional connectivity scheme UDAN (Ude Desh Ka Aam Nagrik). This scheme is designed to allocate funds for revitalizing unused and underused airports primarily located in tier-2 and tier-3 cities.