Economic slowdow and CAA stir hit holiday plans - India Today

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Economic slowdow and CAA stir hit holiday plans - India Today

Economic slowdow and CAA stir hit holiday plans - India Today

Posted: 26 Dec 2019 12:00 AM PST

The economic slowdown and the countrywide protests against the Citizenship (Amendment) Act are taking a toll on the domestic travel and tourism sector in this high-octane Christmas-New Year period.

Travel-related bookings have gone down between 5 and 40 per cent across the country with metros like Delhi and Bengaluru being affected the most, industry estimates show. There is a huge rise in cancellations for immediate travel. For instance, the current unrest in the North-East has led to 20-23 per cent drop in monthon-month bookings. Similarly, bookings in December for travel to Delhi have fallen by 38 per cent over the previous year, says travel aggregator Ixigo.

The impact on demand has been felt in both business and leisure segments. While macroeconomic factors affect business destinations, leisure destinations show a greater sensitivity to factors like terror attacks, civil unrest, health-related travel warnings, etc. For the past couple of months, corporates have cut back on work-related travel spends and deferred travel schedules.

According to some estimates, an average corporate traveller takes over 150 flights in a year. Due to slowdown, this number has come down drastically as the focus is to consolidate travel and plan in advance.

Leisure travellers, on the other hand, are rescheduling or shelving their travel plans largely on account of unrest caused by CAA.

"We are in constant touch with all our customers to assist with requests to defer their travel to the affected destinations, as also to offer optional destinations while working with our partners and suppliers, including airlines, to assist travellers with cancellations and refunds," says Rajeev Kale, president and country head (holiday, MICE, Visa) at Thomas Cook (India).

"With the ongoing situation, we have noticed customers rescheduling their trips to North-Eastern states. They are opting for domestic destinations like Kerala and Andaman instead. With customer safety being a top priority, we are providing alternative measures and further rescheduling their vacations," says Daniel D'souza, president and country head (leisure) at SOTC Travel.

The North-East, which picked up amongst the domestic tourists in the recent years due to hidden treasures like Tawang (in Arunachal Pradesh), Mawlynnong Village (in Meghalaya) and Kanchendzonga National Park (in Sikkim), seems to have taken a severe beating.

"Christmas and New Year are the most-awaited festive period. But the ongoing protests all over India against the new citizenship law have put all the metro cities in turmoil. Several countries like USA, UK, Canada, Australia, France, Russia, UAE and Singapore have issued travel advisories to their citizens advising them to avoid non-essential travel to India and especially to the affected areas," said Shahnawaz Zafar, country manager, sales, United Travels and Tours Pvt Ltd, Singapore. He operates from Delhi.

"This has led to trip cancellations from inbound as well as domestic tourists causing a huge loss to travel industry partners," he said.

It is also surprising that in a peak tourist season, the country's largest airline IndiGo has announced flash sales where it's giving out one million domestic tickets at Rs 899 and international tickets at Rs 2,999 for travel between January and April next year. In October, IndiGo's CEO Ronojoy Dutta had said that flash sales are an indicator of weakness in the market.

If general slowdown was not enough, the current unrest has only aggravated the situation for domestic travellers. The weak sentiments are reflected in the air passenger numbers which have dropped considerably over the past year. The 11-month passenger growth stands at 3.86% as compared to 19.21% in the corresponding period last year.

"The foreign tourist arrivals (FTAs) are quite slow in 2019. Though domestic tourist visits are slow but comparatively better than the FTAs. This is on account of overall weak domestic economy as well as slowdown in major global markets like US, UK and Europe," says Darshini Kansara, deputy manager (industry research) at CARE Ratings.

Between January and November this year, tourism ministry data shows that FTAs have registered growth of 3.2%, which is marginally higher than 2% in 2018. Domestic travellers, and as a subset leisure travellers, are the biggest spenders for the travel and tourism market accounting for 87% of the overall sector economy.

"Outrage on street has created more fear and uncertainty after economic slowdown. This is the peak session for tourism but over 30 per cent domestic tourists have canceled tour packages as they do not want to face hindrance like road jams and violence," said BN Lal, a Gurugrambased travel operator.

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