CEO Conclave: Paving The Way For India’s Tourism Turnaround

The CEO Conclave at TravelWorld 2005 witnessed the convergence of several captains of the industry to discuss and - ‘Global Tourism Trends Impacting Indian Businesses’. A high-powered panel moderated by Pradip Madhavji, chairman elect, SAARC Chamber Tourism Council, pondered upon international and Indian tourism's purple patch as well the potential threats that could spoil the party. Express Travel & Tourism presents the complete picture

Pradip Madhavji

“The statistic of over 700 million international tourists for 2004, which may well rise to one billion by 2010, raises several issues about how the social infrastructure, airports and hotels will be able to service this increase. The implications still remain in the domain of speculation. Further, there are issues of security. How early will passengers have to check in at airports? How can tourism continue to flourish amid so many uncertain challenges,” said Pradip Madhavji, chairman elect, SAARC Chamber Tourism Council and moderator of the CEO Conclave.

'India Needs to Rectify The Imbalance Between Inbound And Outbound Tourism'

John Koldowski

The public and private sector must establish dialogue and look at ways in which to advance forward towards a mutual agenda and hat is now beginning to happen in India. 760 million tourist arrivals were approximately clocked in 2004 translating into a 10 per cent increase and the best percentage gain in the last two decades. Asia Pacific is growing by 29 per cent year on year. There is also significant potential for increase in tourism in the Middle East and South and South East Asia. The Association of Asia Pacific Airlines said they moved more passengers around Asia Pacific in 2004 that ever before - 170 million, representing 17 airlines. They further predict a growth of five to six per cent and that there will be 73 aircrafts added to existing member fleets. Yet, in terms of all international flights into the Asia Pacific region, South Asia captures less than two per cent. The room occupancy rates in Mumbai are in fact outperforming the Asian average. It has touched a RevPAR of Rs 5000. It is a pity that states like Goa are not part of this survey. An average annual growth rate of 7.5 per cent year is expected for South East Asia over the next three years. The tsunami has had a limited effect on tourism to the region though the story is a bit different for destination actually hit by the tsunami. For India, between 2004 and 2007, we expect a 13 and 14 per cent growth per annum. However, we need to take that into context the fact that the base of measurement for India is considerably low -- a little over 3 million and achieving a 13 per cent growth on that figure is not as spectacular as achieving the same on a bigger base. India also needs to consider how it is going to raise the supporting infrastructure, airline seat capacity as well as hotel rooms.

India's outbound tourism is growing more than the inbound tourism so India is sitting on a gathering deficit as more Indians are spending their money overseas than foreigners spending their money in India. This imbalance needs to be rectified. Almost half of the government revenue goes towards servicing public debt, which is 90 per cent of GDP. The overall environment, within which this bullishness is gathering, is also changing. Global growth is expected to slow down and interest rates are expected to rise. The Eurozone and Japan are expected to experience sluggish economic growth while the US dollar is expected to further fall. New aircraft models from Airbus and Boeing are also expected to change the current complexion of international avionics.

- John Koldowski, director - strategic intelligence centre, PATA Bangkok

'Indian Tourism needs to spruce up its act'

Alex Kyriakidis

The recovery of tourism has played out in earnest over the last two years across the globe. Most major cities experienced positive RevPAR. There is reason to believe the worst is behind us. The quantum of air travel is set to swell incredibly in coming years. There is no question though that things are going to get tougher for travellers with security and visa issues. Natural disasters are now a hallmark rather than incidents in isolation, with a nearly 100 billion dollar economic loss notched up in 2004.

Ultimately someone has to bear the financial brunt of this enormous loss and the entity, most likely, to be forced to pick up the tab will be the end consumer. Things are going to become expensive. The weakness of the dollar could potentially further internalise the American tourism industry, with Americans choosing to travel within their country. They are getting better value for their dollar at home and so are the Europeans who holiday in the US customer sensibilities are changing.

Hotels, nightclubs and restaurants have to rethink their positioning. India is facing competition from destinations like Dubai, which is spending up to US$ 40 billion on infrastructure development geared specifically towards boosting inbound tourism. The tourist target is ten million, up from the current 4.8 million. Qatar has spent 20 billion while China has spent 15 billion on gearing up for the 2008 Olympic Games. Now, with so much competition for the international tourist segment will result in the cannibilisation of each other's markets and this is something India is vulnerable to. There could well be a situation wherein a lot of India's future tourism growth could be cannibalised by its better-placed competition. There is a huge opportunity in the waiting in terms of the huge number of outbound Chinese tourists who could be attracted to India but language could pose a unique threat if India is not able to mobilise a number of Chinese speaking tourism professionals. The good news for travel agents and tour operators is that they still have the edge over the Internet in terms of providing value added service although the figure of online revenue in the US set to double to US$ 90 million in the next four years.

- Alex Kyriakidis, global managing partner - Travel, Hospitality and Leisure, Deloitte Touche Tohmatsu

'Tourism Is Perpetually Faced With Questions About Economic And Environmental Impact'

Imtiaz Muqbil

I am basically trying to play the role of an ‘early warning system’ in the context of the potential threats and challenges that can spoil international tourism's party. Security, for one, could be a potentially high financial drain on the tourism economy. The upgradation of airports, all round the world, to American standards of security will cost eight to 17 million dollars per airport. Let one also consider the consequences of allowing our airports, seaports and railway stations being controlled by the private sector with large foreign investments. Tourism is faced with questions about its economic and environmental impact. The levels of water consumption by tourists in areas where locals suffer from water paucity and massive levels of jet fuel emissions the increasing number of aircraft being put in the sky are creating a whole new set of concerns. There is also the gathering ‘clonelistation’ of cities wherein several international metros are losing their social identity as these are being fashioned on a set piece. Also the private involvement in tourism, particularly in the area of aviation and public services further raises the spectra of a security risk, given that their compulsion to ensure the safety of tourists is perhaps driven more by costs than it is for the government. When one looks back at the whole series of crises that have affected our world recently, the essential commonality is that these were all manmade. We need to start influencing these unfortunate events by recovering quickly rather than the other way around.

- Imtiaz Muqbil, executive editor, TravelNewsWire, Bangkok

L-R: John Koldowski, director - strategic inteligence centre, PATA Bangkok, Pradip Madhavji, chairman elect, SAARC Chamber Tourism Council, Alex Kyriakidis, global managing partner - Travel, Hospitality and Leisure, Deloitte Touche Tohmatsu and Imtiaz Muqbil, executive editor, TravelNewsWire, Bangkok.	Seema Luthra, Head of Strategy and Chief Marketing Officer, InterGlobe Enterprises kicks off the CEO Conclave	L-R: Kavi Ghei of TRAC Representations, Malcom Fernandes and Raj Bedassy of Air Mauritius in rapt attention

Friendly Relations: Khalid Ibrahim Bin Nassar, officer overseas promotions, DTCM felicitates Pradip Madhavji, chairman elect, SAARC Chamber Tourism Council	Listening attentively to a focussed panel	Vikas Singhal of Xpress Holidays, Anju Desai of JetAir Tours and Gour Kanjilal of Indiatourism ponder over the presentations