Indian industry body ASSOCHAM has predicted that the Indian tourism industry growth will drop up to 10% in the current fiscal year.
India's Tourism industry's growth would drop by 10% in FY08-09, estimated the Tourism Committee of the Associated Chamber of Commerce and Industry of India, as per the news published by RTTnews.
ASSOCHAM said that inbound tourism from Europe would fall around 5% and the overall growth in the industry is likely to drop between 10%-15%. Further October 2008 saw an increase of just 1.8% in the number of foreign tourist arrivals compared to the same time in 2007. Also under usual circumstances, the Tourism Industry was to grow 15% in the FY09. Further outbound tourism from the country would fall to an extent of 5-7% due to the global meltdown according to the industry body.
Assocham predicts that due to adverse effects of decline in inbound tourism from US to India has already declined. Moreover since Indian Inc is passing through a bad phase in the sense that jobs are being cut and salary reduced, anticipated due to shrinkages in margins of most of employers, the country's tourism within the country would also be hit.
Further the worst financial crisis in 80 years and a slew of militant attacks has hit an industry that has basked in double-digit growth numbers of both domestic and foreign tourists in recent years.
In addition a slump risks undermining India's enormous growth potential in the tourism sector, which the U.N.'s World Tourism Organization (UNWTO) said has also been let down in the past by a lack of adequate accommodation and poor infrastructure.
The Assocham however, does not expect a gloomy scenario for both inbound and outbound tourism as negativity arising out of negative sentiments in economies of scale could be offset, as India expects better tourist flow from countries in the entire Middle East because of its richness.
According to an analyst at RNCOS the Indian tourism sector is expected to grow slowly in current fiscal year due to global recession. However foreign exchange earnings through tourism would not see much erosion during the fiscal as the losses would be compensated from countries in Middle East and South East Asia, as tourists' movement from these countries would be more focused and visible towards India.
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