Tourism can be the Key Driver for Indian Economy: Amitabh Kant

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One thing that really comes across is that in every speech of the Prime Minister, he emphasizes the importance and the significant of tourism and how tourism can be the biggest driver of growth.

Even this budget spoke about tourism, because I think everybody in the government really believes that tourism can be a big driver of growth. And globally, if you look at tourism, it is actually a $5 trillion economy. A $5 trillion economy with India’s share at about less than 2%. So less than 2% share to my mind is very dismal, and it’s needs to be very substantially increased. And if you look at the pre-pandemic level, the total arrival in Thailand was 40 million, in Malaysia was close to 28 million. India now 10, 10.8 or 10.9 million tourists.

I am not a great believer in just the volume. I am a great believer in per capita earnings. And I don’t believe in the numbers game, actually. But if you look at tourism, I think from a perspective of a political lens, the politician only understands one thing. And that is how many jobs has the tourism sector created? And I and you know, tourism has a huge multiplier impact for every direct job that you create, you create seven indirect jobs. But I think somehow the tourism industry has failed to tell the politician that we are a big creator of jobs.

If you look at employment, Thailand creates close to about 20 million jobs. Malaysia creates close to about 15 million jobs from tourism sector. We create about 7.3 million jobs. But I think it’ll be worthwhile for the tourism industry to have a target of creating, of telling the political system across the centre and the states that if you give attention to tourism, we will create 25 million jobs by 2030. And it is a do-able target. If you put this target before the political system, that 25 million jobs will be created by the tourism sector, that it will have a huge impact on the minds of the political system, and they will do everything possible for tourism. And to my mind, that’s the only language which would be understood and that I think you should push at the state level.

Second, is that you know, when I was in the tourism sector, we had a huge challenge of not having clean sheets, clean bathrooms in tier 2 and tier 3 cities, et cetera. But I think India has been through a huge radical transformation in the last eight to nine years. We are now the fifth largest economy in the world. By 2027 end, will be the third largest economy in the world. We are heading to be a $10 trillion economy by 2030, and by 2047, by the time we become a hundred years old as an independent country, maybe a $35 trillion economy.

And if you look at the last eight to ten years, there’s some remarkable things that have happened in this country. We made close to about 40 million houses in India. It is like making a house for every single person living in Australia.

We provided 110 million toilets and that’s like providing a toilet with everyone living in Germany. That’s the size of the population of Germany. And we provided 253 million piped water connections, which is like providing a pipe water connection to everybody, every single citizen of Brazil. That’s the size, the scale of India, what India has done. But India has also, in the last 10 years, actually built about close to 77 to 78,000 kilometres of road. So, it’s provided accessibility to everyone. And it’s built close to about a close to about 70 to 75 airports in India. So, it is provided tier two and tier three cities with accessibility, with airports which never existed. Now you’ll have clean bathrooms, you’ll have a huge focus on Swatchh Bharat, you’ll have road connectivity, airport connectivity to all these areas which never existed in India.

And actually, we should not worry too much about the outlay, which has been provided to the ministry of tourism, because tourism is a multi-dimensional sector. If roads come up, if you know, you have airports coming up, tourism will automatically grow. And that’s why if India grows, tourism will grow. And to my mind, the multiplier impact of what has been done in India in terms of infrastructure creation will be enormous in the years to come. But one of the key things that’s happened is that the impact of G20 has been enormous. If you’ve had about 120,000 people coming in as the participants with G20, they’ve all gone back as brand ambassadors of India. We did not do the G20 in one city or two cities, but we spread it out over close 220 odd meetings in over 60 cities of India.

So in all these cities, we improved the drainage, the sewage, the solid waste, the roads, the lakes, all of them were cleaned up. So, the infrastructure redoing, redesigning redevelopment has been enormous of this impact of this G20. And I think that will have a long-term spinoff in, in terms of tourism.

But my view is that there are four or five key areas which are important. And I think first and foremost, I really think that enhancing the quality of tourism infrastructure and creating experiences in states is very important. And it’s very significant. And to my mind, rather than looking at the whole country, because India is a very large country, it’s bigger than 24 countries of Europe plus another 30,000 kilometres.

So, if you look at India as a whole, you’ll never be able to make an impact. But my view is that the hospitality industry should really challenge all the states and union territories over here and really pick up five key states where there’s huge tourism potential. You you have many, many associations, all of them should get together and challenge all the states and union territories of India and say that these are five states of union territories, where we are going to work for the next two, three years and really work in good private public partnership and transform them. And we will really make them world class destination in terms of their circuits, in terms of their destination. Because I believe that tourism is essentially a private sector activity, from the point of arrival to the point of departure.

If you are able to select five states and make them top class and challenge these states, really throw a challenge to these states that we are going to work to create world class museums. The states should do their bit, you do your bit and really make them really top class that might be so really if you are able to create a huge spinoff. If you can make states compete with each other for tourism, then you’ll see a huge spinoff in subsequent years.

Second is my belief that actually one area where India has really lagged behind is the meetings, incentives, convention and exhibitions market; it’s a 500 billion market. Now, when I was in the tourism sector, one of the challenges was that there was no world class facility. There was no world class infrastructure.

Look at both Yashobhoomi and the Bharat Mandapam. And I have seen all the top convention centres around the world, because I’ve got it designed and I’ve got it executed, this one at Dwarka. India never had these kinds of infrastructure facilities. Now you are dealing with a 500 billion market. India share is less than 1%. And in my mind for an industry which claims itself to be really dynamic, really vibrant, really energetic. If you’re not able to capture a major chunk of that market, it is a shame. And what we should really challenge the world is that not a single exhibition or convention will be held anywhere else in the world other than India because we have the best in the world now.

The third big ticket thing to my mind is being that at a point of time when Indian civil aviation sector was weak, we gave away a lot of our bilateral rights to international carriers. And in the process since we gave away a lot of bilateral rights, we allowed many other airports to become hubs. And they became global hubs.

They are very big opportunities for the hospitality sector, for retail sector. They become very big drivers of those destinations. And that’s how Dubai grew, that’s how Qatar is growing. It’s now time for us because India’s never had great airports. Now with Mumbai, with Bangalore and Hyderabad it is important that we review these bilateral rights and really make our airports, the global hubs for direct operation from here to the rest of the world. We should really reposition India as global hub airports, which will ensure a huge amount of tourist inflow.

And therefore, there is a need for all of you to lobby and position for Indian airports to become global hubs.

And my belief is that there is, there is a very clear need. While the domestic market has been revived, it’s been lively and vibrant. The foreign tourists need to grow in large numbers because they bring in value. And there is a need for a very lively, very vibrant, very dynamic and a highly digital version of the Incredible India campaign and  that should penetrate every single market. And this is critical because foreign tourists are critical for India, and we need to do that. Leisure tourism is important because they bring in high value and there is a need for this market to grow.

The last point, why is it necessary to make tourism an industry? It is needed because when you treat a sector as a commercial sector, the power tariffs are much higher than the industry tariffs, much higher. The interest rates are higher, and it is necessary that tourism is treated as an industry. And your day-to-day operations then tend to get impacted. And my view on that is very clear that all states must treat every activity, every sector of the tourism industry, as an industry. I think 11 states have done it, but they have not extended, many of them have not extended the benefits. They treated us as industry, but have not extended the benefits of what they give to the industry, to the tourism sector.

And I think we need to really work hard and really push the governments at the state level, centre also needs to put it as an industry because that will help.

So, my belief is very strongly that it is an important industry because it’s a very major job creator. And pushing it as an industry will really help both at the state and central level. And to my mind you should work with states, you should work very closely with states which declare as an industry and provide all the benefits.

So, I am a very clear believer in tourism. I’m a very clear believer that the multi-dimensional impact of tourism is like no other. The Prime Minister is a great believer in tourism. He believes that this is a sector which has a huge impact on jobs. He believes that it can give you a huge amount of growth, and he believes that it can have a huge amount of equitable spread across many sectors. Because when you impact tourism, you are having an impact on livelihoods. You are having an impact on craftsmen. You are having an impact on the cuisine sector of India, many, many other sectors of India.

And therefore, I really think that we together with the government, we all need to work together to make tourism grow and expand and become the key sector. And I’m a believer that for India to grow, it needs to fire on manufacturing. It needs to fire on services, it needs to fire on agriculture, productivity. But more than anything else, it needs to grow and expand at rates of about 25% plus year after year, year after year for the next decade or so in the tourism sector. And this, to my mind, is very, very doable considering the very small share that we have in the global tourism market. And if we do this for the next decade or so, we truly transform the lives of many citizens of India, provide vast segments of jobs in India.


Amitabh Kant is presently India’s Sherpa to G20 group, during a year when India holds its presidency. Kant is formerly a secretary in the Government of India, former CEO of Niti Ayog, and creator of globally acclaimed campaigns like ‘Incredible India’ for the Ministry of Tourism.

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