News Analysis

On the track of luxury

Luxury rail tourism seems to be the latest catchword for state tourism boards to lure the big bucks, especially from the international market. Reema Sisodia and Priya Krishnaswamy analyses this concept and how it will roll ahead

If one tries to closely follow tourism in India, the fact that the country is undergoing a metamorphosis is something that seems quite apparent. India has over the years matured to offer world class niche experiences and one such experience is that of the luxury trains that has caught the attention of State Tourism Boards (STBs) as a premium and niche product, designed specially to lure the international high-spending tourists.

Luxury trains have been successful and popular across the world - whether it's South Africa's Blue Train, Rovos 'Pride of Africa' Rail, the Eastern and Oriental Express, The Royal Scotsman, British Pullman, Northern Belle or the Venice Simplon-Orient Express - and India is no exception. Rajasthan was the first to launch the concept of luxury trains with its Palace on Wheels that began operating in January, 1982. This was followed by Maharashtra almost 22 years later in January 2004 when it launched its Deccan Odyssey.

Today, more states are joining in. Karnataka is all set to launch its luxury train product by 2007. The state will include heritage sites like Hampi and Pattadakal in its route. S N Gowrishankar, joint commissioner, Department of Tourism, Karnataka, says, "The product will definitely bring in a lot of foreign tourists." Dr P K Goyal, executive director (Tourism & Catering) with Indian Railways, claims that the authorities are doing their best to improve this type of tourism. "The luxury train concept can give a whole new dimension to the tourism experience of a foreigner visiting India," he says.

Moreover, Madhya Pradesh has approached the Indian Railways to work out a feasibility study to run a luxury train. The state's coordination sub-committee, together with the Hotel & Restaurant Association (Western India), had put forth the concept of having a luxury train called the Malwa Odyssey. Confirming this is G S Chahal, executive director of Madhya Pradesh Tourism Development Corporation, who says, "If the project comes through, we will operate the train from New Delhi passing through Agra, Gwalior and other key areas of Madhya Pradesh."

Increasing demand

The states have obviously done their homework. Market research reveals that the demand for an experience on a luxury train in India is fast catching up in the international market. The Deccan Odyssey is also steadily receiving positive market feedback and Maharashtra hopes to break even by the year 2008-2009. The product has, since its launch, seen an increase in bookings - it had 406 passengers in the first season, 612 in the second and has now recorded a booking of 800 seats for this season commencing October 2006 to May 2007.

The Palace on Wheels is reportedly booked till 2010 during peak season. Its success has consequently prompted Rajasthan to set into action another train called Palace on Wheels 2, which is scheduled to be operational by 2007. The train would have a 50-50 partnership plan with an investment of Rs 12.5 crore from Indian Railways and the state of Rajasthan.

According to sources, Rajasthan had initially put forth an Expression of Interest to the Indian Railways to take over Deccan Odyssey but the latter refused the proposition on the grounds of unfeasibility and instead made an offer to opt for a completely new train, which resulted in Palace on Wheels 2. Rajasthan already has introduced its second train called Heritage on Wheels in February 2006. It operates on a shorter circuit including the Shekhawati region of Rajasthan. Vinod Zutshi, secretary tourism, Government of Rajasthan, says, "The success with regards to our luxury train is so encouraging that introducing another similar product was only natural."

Rajasthan Tourism Development Corporation (RTDC) is looking at launching yet another luxury train with the help of private partner Oberoi group of hotels, which has already approached the nodal agency Indian Railways Catering and Tourism Corporation (IRCTC) with a proposal. The hotel company is keen to own and operate an eight-coach 24-cabin luxury train on the Delhi-Rajasthan-Agra circuit which is known to be the most profitable circuits in the north.

Rajasthan is not alone in this. Confident about the success of Deccan Odyssey, Maharashtra has also gone ahead with its next luxury train, albeit on a smaller scale, in the Vidharbha region on the Nagpur- Nagbhid route with Tadoba Tiger Reserve as the main attraction, which is scheduled to be operational by end of 2006.

Start on the slow track

All success stories have a history of struggle behind them and Palace on Wheels is no different. Pradeep Bohra, its manager, admits that though it started in 1982, the initial years were tough and it went through a phase of gestation. "The initial teething problems can be attributed to issues like marketing and branding. The product gained popularity only with time and it was in 1986 that we found that the train is getting the desired response," he says.

Supporters of Deccan Odyssey therefore, are extremely positive of its success. Among them is Prithviraj Patil, GM of Maharashtra Tourism Development Corporation (MTDC), who says, "I can say with confidence that luxury trains do have their market. That is why we are floating another train though on a smaller scale." Supporting this view is Lalit Sheth, CMD of Raj Travels that has been recently declared as GSA for Deccan Odyssey. "This product has a future and the market today is prepared for such a concept," he exclaims.

Unfortunately, the state of Gujarat was not as lucky. The Royal Orient, a joint venture between the Tourism Corporation of Gujarat and the Indian Railways, which was operating since 1995, ceased operations in 2004. According to sources from Gujarat tourism, the train had an attractive itinerary covering the most interesting tourism spots of Gujarat. However, it had to be discontinued as it was metre gauge line and there was demand to change the route to a broad gauged one.

Citing these as examples, experts feel that there are a few factors that work towards the success of a luxury train product - dedicated and focused marketing efforts in the right target market, product itinerary and the places of interest it covers, the experience onboard and the treatment and experience both before and after the actual journey. Though the second and third factors were in place in case of The Royal Orient, it was the first that was not quite up to the mark and that reduced its success considerably. Meher Bhan-dhara, manager (Corporate Communications) at Travel Corporation of India, which is GSA for Deccan Odyssey as well as The Royal Orient, says, "Luxury trains are an excellent concept and definitely has a market especially for those who can afford a high-end product. But its success will depend largely on the product itself in terms of its operational smoothness namely on time departures, the itinerary, quality service and effective marketing and promotional activities in the right markets. With all this in place there is no looking back for a concept such as this in the Indian market."

Newer routes

This opinion is echoed by tour operators as well. New Delhi-based Luxury Trains of India that offers both Palace on Wheels as well as Deccan Odyssey on the same itinerary also includes a 14-day package covering two states. Manish Saini, its online marketing manager, says, "The luxury train concept is definitely a success and we have received a positive feedback. Our product, India on Wheels, that combines both the packages is also garnering encouraging response." With Karnataka joining the bandwagon soon, this package can also extend into one more state offering yet another experience.

Chartering these luxury trains during peak seasons is again another business opportunity that Maharashtra tourism is aiming to cash in on and has already received inquiries especially from the UK market. Vijay Chavan, chief project officer of Deccan Odyssey, says, "We have received seven inquiries for the 2007-2008 season from companies in the UK and the US. In fact, the first charter deal may come through in a month's time. It would be a seven night package and will cost the compay Rs 60 lakh."

With an increasing number of states looking at entering the luxury train market, things are going alright so far. And if the market dynamics together with a little encouragement from the tourists play along, India will soon be ready to become one of best destinations to offer an array of luxury trains to choose from.