Tourism season faces impact of cash crunch; domestic tourism hit by 65 pct in India: ASSOCHAM

With shortage of cash dampening consumer confidence, the ongoing tourism season is witnessing a significant dent with not much enthusiasm for Christmas and New Year holidays at some of the popular destinations which are reporting at least 65 percent drop in bookings, barring Goa that is catching up of late, an ASSOCHAM survey has noted.

Even though the tourism season begins around October-November, it picks up around Christmas and the New Year, with tourists making beeline to popular destinations in Rajasthan, Madhya Pradesh, Uttar Pradesh, Ahemdabad, Uttarakhand, Goa, Kerala while some enthusiasts too head for the hills for snowfall, reveals the associated chamber of commerce and industry of India (ASSOCHAM).

According to the findings, travel trade has reported around 40-45 percent drop in bookings for international tourists while business for the domestic travelers has gone down by well over 65 per cent. There is also slowdown in the number of bookings from the international tourists, considering November, December and January being the peak season of international tourists' inflow.

The drop in bookings has also resulted in lowering of the rates for hotels and airlines tickets to the extent of 30-35 percent as compared to similar months of the previous year, adds the findings.

While the travel trade including airlines, hotels and railways have mostly shifted to online bookings, the impact is seen largely because of erosion in the consumer confidence as most of the self employed people have been witnessing a sharp decline in earnings while professionals employed in the organized sector too have been affected psychologically by the 'scarcity syndrome', said D S Rawat, Secretary General ASSOCHAM.

This year, the prospects of this peak season look subdued as fallout of the demonetisation drive. According to the industry insiders, a staggering fall of about 60-65 percent in domestic bookings and around 40-45 percent fall in international bookings has brought the travel and tourism and hospitality industry to standstill, according to an ASSOCHAM latest assessment.

The flow of tourists coming under organized packages and groups has not been affected, but many of those who do not plan their stay in advance have cancelled their trips. The tourists visiting the state, especially foreigners, also complain of difficulties in getting their currency exchanged.

The currency crisis has hit the tourism season hard. The number of travelers in organized trips has not been affected much because their hotels and taxis are booked in advance. The occupancy of hotel rooms have come down and the impact is also visible on taxi operators, small vendors and others, reveals the ASSOCHAM findings.