2024 Union Interim Budget: The Travel & Tourism Industry Speaks

This year the Interim Budget 2024 has provided much relief to the Indian Travel & Tourism sector to help bolster the economy by supporting domestic tourism.

Mrs  Nirmala Sitharaman  Union Minister for Finance and Corporate  Affairs, Govt of India, announced a boost to the travel and tourism sector through active participation of states, convergence of government programmes, and public-private partnerships.

Madhavan Menon, Executive Chairman, Thomas Cook (India) Limited

The interim Budget presented by the Finance Minister has focussed on Tourism with a multipronged approach that we believe will create a multiplier effect across aviation, tourism, and allied sectors, boosting growth and employment generation.

We welcome the announcements on airport development and expansion: having already doubled to 149 airports in the last decade, the government’s plans to boost air connectivity by the addition of 517 new routes across Tier 2-3 cities, carrying 1.3 crore passengers via the UDAN scheme, will play a critical role with vibrant hub and spoke air corridors to boost accessibility-affordability for Regional India.

Implementation of major rail connectivity corridors via the PM Gati Shakti program together with port and metro/rapid transport expansion will serve to create valuable multi-modal connectivity for Tourism.

We welcome the special focus on Domestic Tourism which represents a vibrant growth driver via the government’s plan of long-term interest-free loans to States; the development of iconic tourism centres by States along marketing on global standards. What was noteworthy is the reference to Spiritual Tourism and projects for port connectivity, tourism infrastructure, and amenities on islands including Lakshadweep – aimed at the development of India’s hidden gems and employment opportunities.

Further, the strong capex outlay of Rs 11.11 lakh cr, a significant 4% of our GDP, will catalyze the Country’s growth potential and job creation.

Mr. Ajay Singh, CMD SpiceJet and President, ASSOCHAM.

“It is a confident budget of a confident government that focuses on the objective of ensuring that India becomes a 5 trillion-dollar economy by 2025 and a developed nation by 2047. I commend the FM for her unwavering commitment to sab ka saath, sabka vikas, and sabka vishwas. I commend especially the increase in infrastructure spending that will have a multiplier effect on our economy. I commend the evident railway corridors, and the one lakh crore fund for research and development and the startup sector. The emphasis on clean energy, technology, and digital infrastructure will make India a world leader. This is India’s moment and this budget is part of a continuous process of making policy that will provide massive opportunities for India and Indians.”

Mr. Vishal Suri, Managing Director, SOTC Travel Limited.

 The interim budget presented by the Hon’ble Finance Minister has maintained status-quo on direct and indirect taxes thus keeping its impact neutral. The government has set focus on the overall travel and tourism sector via infrastructure development, green energy, sustainability and looked at diverse initiatives for domestic tourism via a strategic approach for each segment – aviation, ports (waterways), and rail to strengthen regional connectivity to tier 2 and 3 cities.

We welcome the development of the rapid expansion of air connectivity with the addition of 517 new routes across Regional India’s tier 2 and 3 cities via the UDAN scheme – this will play a key role in strengthening accessibility.

The special focus on strengthening domestic tourism via the implementation of rail connectivity corridors under the PM Gati Shakti initiative and upgrading 40,000 regular train boogies into high-speed Vande Bharat trains will strengthen surface transportation.

The Government’s plan to focus on spiritual tourism and, the development of iconic tourist spots and island destinations of India including Lakshadweep (projects for port connectivity, tourism infrastructure, and amenities) will generate employment thus boosting India’s economy. What is noteworthy, is the Government’s mindful move to form a panel to tackle the challenges of higher population/over-tourism, especially in destinations with sensitive ecosystems.

Dr, Vikram Kamat ,Founder and CMD , Vitskamats Group,

“While appreciating the broader economic outlook presented in the interim budget, the hospitality and restaurant sectors also play a pivotal role in our economic landscape and require targeted support to navigate the challenges they face. As we anticipate the full budget, our hope remains steadfast for a more comprehensive approach to address the specific needs of these vital sectors.”

Mr. Shamsher Dewan, Senior Vice President & Group Head – Corporate Ratings, ICRA Limited

The Government’s continued thrust on the Tourism sector and structural measures announced augur well for the domestic hotel demand. Some of the key budgetary proposals that could support demand include the holistic development of 50 tourist destinations in India under ‘Challenged Based Destination Development’, a sub-scheme under Swadesh Darshan, promotion of sustainable and responsible tourist destinations under Swadesh Darshan Scheme 2.0 and exploring ecotourism opportunities through Amrit Darohar. Further, financial assistance through 50-year interest-free loans to States has been proposed for capital projects (including for construction of Unity Malls for selling local goods and produce to tourists). This apart, measures to improve infrastructure and connectivity (including the relatively uncharted places like Lakshadweep), and overall economic development would continue to support the hotel demand. Availability of adequate information through sector-specific skilling/informative guides and data security would improve the tourist experience and facilitate demand growth as well.

Enhancing ease of doing business will also be beneficial for the industry, considering the pick-up in new supply announcements in the last 15-18 months; with the travel and tourism industry comprising several MSME players and vendors, proposals towards skill development and revamping of credit guarantee for MSMEs are key positives for the sector over the medium term. Overall, the proposals in the Union Budget are expected to support the ongoing demand upcycle in the domestic hotel industry.

Rohit Sethi, Co-Founder, Seclude Hotels Home Style

“While expectations were slightly muted due to the interim nature of the budget, we welcome the government’s focus on Atmanirbhar’s development of domestic and inbound tourism. The aviation sector via the UDAAN Scheme has consistently improved connectivity by covering 570 additional routes which is a very beneficial growth trend. Government emphasis on consistent development of infrastructure is very encouraging, with Indian carriers proactively placing orders for more than 1,300 aircraft; doubling of airports to 149 within ten years; additional 40,000 rail bogies being converted to Vande Bharat coaches; all of which will go long way to further boost ease of connectivity for both domestic and international tourists. Providing long-term interest-free loans to promote iconic tourist centers, development of island tourism in destinations such as Lakshadweep, and spiritual tourism are unique areas of special consideration that will have a positive multiplier effect towards job creation and boost local entrepreneurship. There are significant opportunities for India’s tourism sector to be a driver towards the vision of India becoming a developed nation by 2047 by significantly improving the prospects of key social groups mentioned in the latest budget: women, poor, farmers and youth.”

Gautam Aggarwal, Division President, South Asia, Mastercard

“The government’s decision to invest significantly in the tourism sector, as stated by the Union Finance Minister in the Interim Budget, is a welcome step that bodes well for the Indian economy. Coupled with a strong focus on infrastructure development, it will lead to the emergence of new tourism corridors, resulting in greater interest from domestic and international travelers to visit the less explored parts of the country. Mastercard is closely aligned with the government’s vision of tourism contributing USD 1 trillion to India’s GDP by 2047. To support this vision, the company launched its ‘Priceless India’ program last year under the guidance of the Ministry of Tourism. It offers exclusively curated experiences around India’s rich history, culture, cuisine, and a lot more to travel enthusiasts from around the globe.”

Mr. Davinder Juj, General Manager, Eros Hotel New Delhi

“We applaud the forward-thinking measures outlined in Union Budget 2024, particularly the interest-free loans for states to enhance their tourism hubs, attract business, and create entrepreneurship and employment opportunities for locals.

The proposed port connectivity and infrastructure improvements for the island and other attractive location accessibility in the country will motivate families and young tourists to opt for domestic travel. This step will further strengthen the hospitality industry and the travel and tourism sector will grow rapidly in the country. Overall, being an interim budget, Union Budget 2024 was balanced and I expect the recommendations made for direct and indirect taxes will empower the middle class to spend the money on leisure and travel more.”

Aditya Sanghi, CEO & CO-Founder, Hotelogix:  

“We at Hotelogix wholeheartedly applaud the 2024 Union Budget for its steadfast commitment to advancing tourism, recognizing its pivotal role in shaping India’s economic prosperity and cultural legacy. The formidable barrier posed by the high cost of financing in India underscores the urgent need for strategic initiatives. By catalyzing investments in pivotal areas such as port connectivity, tourism infrastructure, and amenities, the budget heralds a new era of growth. Such targeted investment not only amplifies tourist inflows but also enhances the quality of the traveler experience, providing a significant boost to the hospitality sector. As the tourism sector evolves, the infusion of technology into travel and hospitality emerges as a pressing need. Technological advancements promise enhanced efficiency and elevated service quality, making it imperative for the industry’s sustainable growth. We eagerly anticipate further initiatives in this direction from the government and the active involvement of both public and private players.”

Mr Chirag Agrawal, Co-Founder of TravClan

Tourism cannot grow without investment. We welcome the government’s initiatives on developing iconic tourist centers and investing in tourism and connectivity infrastructure. Measures such as long-term loans to states will foster long-term development and unlock India’s tourism potential. We hope for more measures from the government that continue to build our air infrastructure and hospitality sector. This development will not just invite the world to explore our heritage but also ignite local economies and our pride!

Sibasish Mishra, Founder and CEO of Bookingjini a hospitality-focused SaaS startup

“The 2024 Union Budget holds promising implications for our industry, with a commendable focus on uplifting marginalized sections and promoting tourism. Prioritizing the Garib (poor), Mahilayein (women), Yuva (youth), and Annadata (farmers) reflect an inclusive growth approach, ensuring equitable distribution of tourism-related benefits.

The commitment to developing iconic tourist centers and global marketing is a positive step that can significantly boost tourist influx, benefiting hotels and hospitality establishments nationwide. The ongoing expansion of airports over the past decade has enhanced infrastructure for the aviation and tourism sectors, improving connectivity for domestic and international tourists. This not only makes travel more accessible but also creates new opportunities for growth and expansion within the hospitality sector. Overall, the 2024 budget aligns well with the industry’s needs, paving the way for a more inclusive, connected, and prosperous future.”

Kanika Tekriwal, Founder, JetSetGo

‘’As the Finance Minister charts the course for India’s economic future in the interim budget 2024, JetSetGo stands in harmony, sharing a vision of ‘Reform, Perform, and Transform.’ Aligned with the government’s forward-looking initiatives, we celebrate the doubling of airports to 149, enabling private aviation companies like ours to extend our reach and serve as a vital link for India’s economic leaders, entrepreneurs, and decision-makers. The expansion of airport infrastructure complements our commitment to efficient time management and personalized services, ensuring a seamless travel experience. We are enthused by the focus on enhancing tourism infrastructure on islands, recognizing the unique appeal of private jets for reaching offbeat destinations. Emphasizing urban mobility, the Finance Minister’s vision paves the way for growth in the aviation sector. The broader emphasis on infrastructure development and increased spending, coupled with the optimistic outlook for India in the global aviation market, solidify our confidence in the growth story. JetSetGo stands aligned with this vision, having already established strategic partnerships with aircraft technology companies to introduce Advanced Air Mobility solutions, enhancing regional connectivity and contributing to India’s dynamic aviation landscape’’

Mr. Pratik Kamdar, CEO & Co-Founder Neuron Energy.

“The Interim Budget focused on key sectors and one of the promising ones is Electric Vehicles (EV). The initiatives will enhance and fortify the EV ecosystem by bolstering manufacturing and charging infrastructure. Additionally, the encouragement of greater adoption of e-buses for public transport networks through payment security mechanisms is a notable benefit. These investments not only pave the way for increased EV sales and adoption but also open doors for burgeoning job opportunities and entrepreneurial ventures within the sector. These efforts remain dedicated to driving India’s green mobility revolution forward. There is also an anticipated outcome in the form of economic empowerment which will equip the youth with valuable technical skills, ensuring a robust workforce for the manufacturing of EV chargers, and associated equipment. We look forward to the July budget where the focus will be on the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME II) scheme and the much-anticipated FAME III scheme.”

Ankur Gigras, CEO and Co-founder of HexaHealth, 

“The interim budget was just released, and the emphasis on a comprehensive GDP, incorporating governance, development, and performance was evident. The proposed fiscal estimate reinforces a people-centric agenda and promises great enhancement in Indian healthcare. As per WHO, cervical cancer ranks as the fourth most prevalent cancer among women, posing a significant challenge for the Indian population. The budget forecast has thus put focus on prioritizing precautionary healthcare by encouraging vaccination in girls of 9-14 years for cervical cancer. This initiative is a great step to help in the diagnosis and prevention of cervical cancer in girls at an early age. Additionally, the finance minister mentioned extending the Ayushman Bharat scheme to include ASHA and Anganwadi workers, which reflects inclusivity by recognizing their invaluable role in our health system. The finance minister expressed her futuristic expectations during the provisional budget, ensuring the necessary support. The vision for 2047 is full of commitment to providing abundant opportunities for our country. It has motivated the healthcare sector to continue contributing to holistic development and achieve great heights.”

Mr. Amit Parsuramka, CEO, of Bonito Designs

“The budget 2024 has placed a significant emphasis on inclusive development, setting the stage for India’s transformation into a “Viksit Bharat” by 2047. These strides in the PM Awas Yojana Gramin, targeting the construction of 3 crore houses with an additional 2 crore in the next 5 years, underscore a substantial commitment to affordable housing. This approach holds immense promise for the interior designing, real estate, and infrastructure sectors, with a specific focus on uplifting the middle class. Anticipated growth in real estate demand and concurrent development in infrastructure present a myriad of opportunities in Tier II and Tier III markets as well. The announcement about boosting domestic and spiritual tourism will also give rise to real estate and related businesses in those areas. As the government proactively addresses housing needs and establishes collaborations with these sectors, there’s a tangible potential for them to play pivotal roles in the transformative vision of the country”

Travel Agents Association of India (TAAI)

Travel Agents Association of India (TAAI) states that The interim budget has shown no respite to the Travel Agents / Tour Operators. Although announcements have been made on the development and infrastructure of the Tourism Industry specifically in the North East, Island Destinations like Lakshadweep, thereby promoting investment in the sector.

We are happy that the FM spoke about Viksit Bharat and has encouraged other industries but ignored the travel agents and tour operators who are the catalysts in the development, enhancement, and promotion of tourism, be it domestic, inbound, inland as well as outbound tourism.

Further with the increase in UDAN and the aviation sector in India at large, there have been no observations noted or any directions formulated on airlines going bankrupt. TAAI has already submitted a document to the authorities on the protection of the interest of the Consumers / Travellers / Travel Agents against the bankruptcy of Airlines operating in India, whereby hundreds of crores are lost by the travelling community.

Overall at the macro level Tourism Infrastructure and development have got a boost which is a long-term benefit but nothing in the coming year shall benefit the trade at large. We appreciate her views on enhancing and promoting spiritual tourism, which shall certainly lead to more employment and entrepreneurship in the sector. Additionally, the Government’s encouragement of the development of new airports, rail corridors, roads, and ports which shall enable last-mile connectivity is also seen as long-term growth-oriented. We also acknowledge that the Government has placed MiCE, especially Business and Conference Tourism as a prime focus area but the same is not possible without appropriate infrastructure, which shall take a few years to develop.

Nikhil Mansukhani, Managing Director, MAN Industries.

“The budget aligns with the vision of ‘Viksit Bharat’, that of creating a prosperous nation in harmony with mother nature. We see the emphasis on modern infrastructure, including the metro rail network and NaMo Bharat, as a significant catalyst for urban and industrial transformation. It is commendable to see the government’s strategy to triple capital expenditure, fostering robust economic growth and job creation. The 11.1 percent increase in next year’s outlay to 11,11,111 crore, constituting 3.4 percent of the GDP, reflects a visionary approach. The focus on building infrastructure aligns seamlessly with the government’s vision for a resilient and prosperous India.

Very importantly, the provision of viability gap funding for offshore wind energy, the establishment of coal gasification and liquefaction capacity, and the phased mandatory blending of compressed biogas in CNG and PNG are welcome steps towards India’s commitment to achieving ‘net-zero’ by 2070. These will lead to reduced imports and boost self-reliance, a very welcome approach to our sustainability goals.

The strategic economic railway corridor programs are bound to boost the energy, mineral, and cement corridors, ports connectivity, and enhanced and smoother traffic. These initiatives will undoubtedly propel infrastructural development and growth.”

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