IMPACT OF TOURISM ON EMPLOYMENT GENERATION

Tourism is not only a growth engine but also an export growth engine and employment generator. According to the Economic Survey 2011-12 presented in o! Sabha" the sector has capacity to create large-scale employment both direct and indirect" #or diverse sections in society" #rom the most speciali$ed to uns!illed wor!#orce. %t provides &-' per cent o# the world(s total )obs directly and millions more indirectly through the multiplier e##ect as per the *+(s ,orld Tourism -rgani$ation. Since tourism does not #all under a single heading in %ndia(s +ational Accounts Statistics" its contribution has to be estimated. %ts contribution to ./0 and employment in 200'-01 was 2.32 per cent respectively as per Tourist Satellite Account /ata. Tourism activity has long lasting socio-economic impacts on the host economy and community. The employment impact o# tourism goes beyond employment in sectors in which tourists directly spend their money" such as hotels" restaurants and airlines. The establishments which receive tourists also buy goods and services #rom other sectors that generate employment in those sectors through multiplier e##ect. %n %ndia" the tourism sector has witnessed signi#icant growth in recent years. /uring the period 200& to 2011" the 4A.5s o# #oreign tourist arrivals 67TA8 and #oreign exchange earnings 67EE8 #rom tourism 6in rupee terms8 were '.2 per cent and 19.' per cent respectively. 7TAs in %ndia during 2010 were 2.'1 million compared to 2.1' million during 2003" posting a growth o# 11.1 per cent" much higher than the growth o# &.2 per cent #or the world in 2010. 7EEs #rom tourism in rupee terms during 2010 were 5s. &9"113 crore compared to 5s. 29"3&0 crore during 2003 with a growth rate o# 11.1 per cent. /espite the slowdown and recessionary trends in the economies o# Europe and America" 7TAs during 2011 were &.23 million with a growth o# 1.3 per cent over 2010 and 7EEs in 2011 were 5s. ''"231 crore with a growth o# 13.& per cent. %n the case o# outbound tourism" the number o# %ndian nationals( departures #rom %ndia during 2010 was 12.33 million with a growth o# 1'.9 per cent #or the year. /omestic tourism has also emerged as an important contributor to the sector providing much needed resilience. /omestic tourist visits during 2010 are estimated at '90.2 million" with a growth o# 10.' per cent. :otels and restaurants are an important component o# the tourism sector. As on ;1 /ecember 2011" there were 2"132 classi#ied hotel having a capacity o# 1"23"&0& rooms in the country. Availability o# good <uality and a##ordable hotel rooms play an important role in boosting the growth o# tourism in the country. The share o# the hotel and restaurant sector in overall economy increased #rom 1.9& per cent in 2009-02 to 1.2; per cent in 2001-03 and then decreased to 1.9& per cent in 2010-11. :owever" i# the contribution o# this sector only in the service sector is considered" its share decreased #rom 2.'2 per cent in 2009-02 to 2.&9 per cent in 2010-11 as other service sectors grew #aster than this sector. %t 4A.5 was 1.99 per cent during 2009-02 to 2003-10 and the growth rate in 2010-11 was '.' per cent. :ealth tourism" the new entrant in the sector is a niche area where %ndia has good potential. As is natural" with the growth o# this sector" components li!e air travel and hotel stay have been included under service tax. The Economic Survey 2010-11 has listed the ma)or policy decisions ta!en in recent years. :owever" a lot more needs to be done to ma!e %ndia a ma)or tourist destination. Some o# the problem areas in this sector include the #ollowing. States impose luxury tax ranging #rom 2 per cent to 12.2 per cent. %n some cases" the luxury tax is applicable on printed room rates whereas actual hotel rates o##ered to guests are much lower. ,ith a view to rationali$ing luxury tax on hotels" the .overnment o# %ndia has re<uested the states to wor! towards rationality and uni#ormity o# taxes so as to ma!e their destinations more competitive. They have been also re<uested to exempt room tari## below 5s. 2200 #rom luxury tax and charge luxury tax at a uni#orm rate o# 9 per cent on actual tari##. 4onstruction o# hotels is primarily a private sector activity which is capital intensive and has a long gestation period. A ma)or constraint being #aced by the hotel industry in addition to the high cost and limited availability o# land is the procurement or multiple

clearances=approvals re<uired #rom 4entral and State .overnment agencies #or hotel pro)ects. >arying #rom state to state" in some cases as many as &2 clearances=approvals are re<uired #or hotel pro)ects. A :ospitality /evelopment and 0romotion ?oard has been set up at central level. The main #unction o# the ?oard will be to monitor and #acilitate clearances=approvals #or hotel pro)ects both at central and state government levels. The ?oard will be a single window #or receiving applications #or various clearances" approving=clearing hotel pro)ects in a time bound manner" and reviewing hotel pro)ect policies to encourage the growth o# hotel=hospitality in#rastructure in the country. State .overnments have also been re<uested to set up similar boards under the 4hairmanship o# their 4hie# Secretaries. So #ar @i$oram" @anipur" and @aharashtra have set such boards. -ther measures in this sector could include rationali$ing the #ees #or entry to monuments and using the #ees #or their maintenanceA #ocusing on sa#ety o# touristsA and promoting wellness tourism. The emerged picture o# tourism potential and related employment coupled with the identi#ication o# gaps in planning" provision" positioning and mar!eting o# tourism point towards the re<uisite interventions at macro as well as micro level. @acro interventions are related with macro economic policy #ramewor! in which tourism industry operates in the country. -n the other hand" micro interventions are related with spatial planning" e##icient provision and mar!eting o# tourist destinations. Above observations coupled with timely and e##icient implementation o# programs and plans outlined in the tourism policies o# respective States can cataly$e the growth o# tourism industry in the country resulting in creation o# more tourism related )obs. ?esides above" some additional measures are re<uired to improve the air and sur#ace connectivity o# all these destinations. 7urther" the issues related with environment and #ragility o# eco-systems needs special attention. Special attention is also re<uired #or increasing the employment o# women in the tourism industry. Employers should set up programs and schemes encouraging women to move into non-traditional occupations" invest in womenBs training" appoint them in managerial positions" and re-appoint them a#ter years o# diminished involvement due to #amily responsibilities. To sum up" %ndian tourism has vast potential #or generating employment and earning large sums o# #oreign exchange besides giving a #illip to the countryBs overall economic and social development. @uch has been achieved by way o# increasing air seat capacity" increasing trains and railway connectivity to important tourist destinations" #our-laning o# roads connecting important tourist centers and increasing availability o# accommodation by adding heritage hotels to the hotel industry and encouraging paying guest accommodations. ?ut much more remains to be done. Since tourism is a multi-dimensional activity" and basically a service industry" it would be necessary that all wings o# the 4entral and State governments" private sector and voluntary organi$ations become active partners in the endeavor to attain sustainable growth in tourism i# %ndia is to become a world player in the tourist industry.