Nobody Loves A Good War

The confusion over the "hijacking" of a Mumbai-Delhi flight last week in the Capital could perhaps be the last nail in the ailing Indian travel industry's coffin. Already crippled by the impact of the wtc attacks, it was hoping for some "sops" from the government to ward off these difficult days. What it got instead was a scary four-hour hijacking farce that could well make a few thousand more families postpone their holidays.

The threat of a US attack on Afghanistan couldn't have come at a worse time. Says a tour operator: "Most Americans think Afghanistan is just five miles north of Delhi. So they are cancelling all their plans to visit India." A major chunk of the annual 2.6 million inbound tourists are Americans. Seventy per cent of the group cancellations after September 11 thus, have originated from the US, with Europe accounting for the rest. In actual terms, the loss to the industry has been unprecedented. Empty rooms and blank booking sheets are ominously staring at hoteliers in this high season of October-March. While the Taj and Oberoi group of hotels paint an optimistic picture when they estimate a mere 10-12 per

cent cancellations, travel agents put this figure much higher. Says a travel agent: "Five-star hotels in the metros are the most affected. Otherwise, why are they willing to adjust rates at any cost? Some of them are even offering rupee rates to foreigners."

Traditionally, the winter months have played host to the highest-spending visitors from abroad, with Kerala, Goa and Rajasthan hogging the bulk of them. Because domestic tourism in India is largely restricted to the summer months and the Dussehra week in September-October, Indians have never really been the target of any hotel or travel agent during the peak season. But the winter of 2001 is different. Now the domestic traveller is being wooed to fill in the vacuum left by the foreigners—with delicious discounts, staggered payments, and a host of freebies.

Says Rakesh Lamba of Prakriti Travels: "At least Indians know that India is safe. The pressure therefore is almost wholly on domestic tourism to make the season work." Adds travel consultant Rabindra Seth: "The industry has no choice but to look inwards because both inbound and outbound travel is low. Now it is the turn of the Indians to be wooed. Hotels are offering up to 35 per cent discounts on rack rates, compared to the 20 per cent in earlier months."

Just how has it changed the life of the domestic and inbound traveller? Take Goa, for instance, which plays host to a number of chartered tourist groups every October. But this year it has seen many cancellations, including all the charters from the Scandinavian countries. In an attempt to fill up the slots, a number of summer packages originally slated to end in September have been extended by a month. These packages, which earlier included free stay and food coupons with the price of a return air ticket, now have added attractions—together with the free stay, a tourist visiting Goa, depending on the package he has chosen, will get all meals, airport transfers, city tours, boat cruises plus a fourth night with breakfast complimentary on a three-night package!

Some agencies feel the bonanza will last only till October. Goa hoteliers are still hopeful that the charters for November and the Christmas-New Year period will work out—they have now raised prices, though marginally, over October. But the fact is that rooms are available in Goa even during the Christmas week."We are now getting confirmation of rooms that were earlier wait-listed for the year-end," says Major Yadav, Wanderlust Travels. This was unheard of a couple of years ago—even a former tourism secretary was asked by a five-star property in Goa to pay in advance.

In Rajasthan, the other most-favoured and this year the most-affected destination, hotel prices have gone up since October 1—major hotel chains in popular destinations like Jaipur, Jodhpur and Udaipur have already hiked their package rates. Travel agents are finding it difficult to sell these packages and feel hotels might be forced either to reduce prices or pack in freebies soon to tackle the low occupancy levels.

"The travel trade has to be creative—they must come up with new and innovative ideas of selling rooms and holidays," says a travel consultant who has even suggested to some hotels that they sell weekend packages to corporates as Diwali gifts for their employees. But even here, there's bad news for the travel industry—a recent government notification has made these taxable!

Even as travel agents are renegotiating advance bookings in the metros and demanding discounts of up to 50 per cent, the new leisure packages for the season are depending more on the add-ons. Says Sita Travels' Arjun Sharma: "The prices may not drop but the value additions will surely go up. The free upgrade or the gala dinner is now being added liberally."

In a bid to attract the domestic traveller, even some smaller destinations in Rajasthan have come up with competitive packages. A new resort in Pushkar offers a two-night package for Rs 6,666 which includes a camel safari, a visit to the dargah in Ajmer, and a free extra night. A travel agent claims that the price of this package has remained unchanged from last year, but the freebies have only doubled since then.

At 170-million heads now, domestic tourism in the country is growing at a handsome rate of 16 per cent a year. Travel agents and hotels depending only on this sector don't see any great reduction in business, a 5 to 6 per cent drop at the most. But those completely dependent on outbound or inbound tourism are now either trying to grab a slice of this domestic pie or hunting for new destinations to catch or promote.

Even outbound travel plans have been given a fresh coat of paint. Since Indians are shying away from crossing the border, agents are offering special packages for Bangkok and Australia—even trying to kill two birds by combining a free stay in a domestic resort with an international ticket. And those dependent on traffic from Europe and the US are now looking at South East Asia. Says Stic Travels' Subhash Goyal: "In Asia, there are about 27 million Buddhists and we can easily get at least 1.5 million of them to come to India to do the Buddhist circuit, if we try."

All these freebies are expected to take a heavy toll of the industry. As a result, it's lobbying with the government for a number of measures that will send more Indians out of home. Like the speedy implementation of the visa-on-arrival scheme, bringing back the leave travel allowance (ltc) scheme for central government employees (abolished in the Union Budget for a year) to give a boost to domestic travel, and a reduction in luxury tax among others. The government has made a small beginning by reducing the entrance fee to all monuments by 50 per cent.

More important, the industry feels, is that the government should help its efforts to sell India as a safe destination, and ask its agencies abroad to do the same, and not scare people more.Grumbles Major Yadav: "In Australia, the Indian High Commission issued a travel advisory that tourists should not go to Jaisalmer because being close to the border could be dangerous. We have taken this up with the government."

But for now, clutching at every straw, the industry wants the government to promise that even if it can't do it any good, it shouldn't do more harm. Especially now, since the operators these days also have to convince tourists that hijacking scares don't happen ever so often in our country!