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Tourism, hospitality will reap the benefits of government steps in 2015

Till November this year, the number of foreign tourist arrivals has gone up by 7.1% to 65.8 lakh; decision to extend e-visa facility for tourists from 43 countries, including the US, Australia, Israel and Japan is viewed as a significant move

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The coming year could be one of cheer for the Indian travel and hospitality industry that has been facing the rough weather for long. Government measures like extension of tourist visa on arrival (VoA), electronic travel authorisation (ETA), lifting restrictions on gaps for re-entry are all likely to trigger an uptake in 2015.

This time around, more properties and destinations have recorded higher bookings as compared to what it was last year. According to a few industry experts, both leisure and corporate travels this year have been on the higher side since July and is expected to see a 15% growth year-on-year.

Sanjay Bhasin, CEO, Goibibo.com, said, "As we are nearing year-end and people are preparing for their last vacation this year, hotel transactions have witnessed a 120% growth over previous month giving the segment a significant boost. Flight bookings have also increased by 40% over last month and going by the increased traction, December seems to be a very promising month for Goibibo."

Till November this year, as per the provisional data released by the ministry of tourism, the number of foreign tourist arrivals has gone up by 7.1% to 65.8 lakh. The decision to extend e-visa facility for tourists from 43 countries, including the US, Australia, Israel and Japan is viewed as a significant move to boost foreign tourist arrivals in the country. Earlier, the scheme was only used to operate for 12 countries. This will allow tourists to come into India within 30 days from the date of approval of ETA which will be valid for 30 days-stay from the arrival date.

Nine international airports such as Bengaluru, Chennai, Kochi, Delhi, Goa, Hyderabad, Kolkata, Mumbai and Thiruvananthapuram have been allowed under this scheme.

During November, a total of 2,968 VoAs were issued under this scheme as compared to 1,824 VoAs during the month of November 2013, registering a growth of 62.7%. During January- November this year, a total number of 24,963 VoAs were issued as compared to 17,594 VoAs during corresponding period of 2013, registering a growth of 41.9%.

The Goa airport at Dabolim has issued 357 VoA within ten days of the commencement of this facility. Goa Tourism is expecting a surge in foreign tourist arrivals from 12% at present to 15% with the launch of the VoA facility.

Rakshit Desai, managing director, India, FCm Travel Solutions and Flight Shop, said, "The year 2014 will go down in history as the year of two very different halves for the travel and tourism industry. While travel sentiment was on a relatively low note in the first half with the industry struggling to achieve any growth, the second half was a revelation with general sentiment turning given greater political certainty. From July, the travel industry has clocked double digit growth every month. Both business and leisure travel by Indian travellers is on the upswing and up nearly 15% year on year."

While the economy is picking-up steam on the back of investor confidence, the Indian consumer is also looking at travel as an important component of the household budget. The idea of one annual vacation is now gradually giving way to multiple short-haul plans dotting the calendar, as Indian travellers seek more experiential and unique vacation options. With technology becoming a transformative force for the industry, there are expectations from an evolving customer-base around more efficient, customized and experiential services.

Kartick Maheshwari, associate partner, Khaitan & Co said, "The worst is behind us. The new year is likely to see some upside for the hospitality industry with some properties more likely to see good occupancy rate."

Achin Khanna, managing director, HVS, a hospitality consultancy firm, recently had said, "More realistically speaking, in the next 8-9 months we can see signs of revival. There is an upside on occupancy but rates have not improved and I will not be surprised if the rates remain in distress for another one-and-a half year."

Though average occupancy is more likely to increase, average room rate is still likely to be under pressure. "The average occupancy is likely to touch 60% by this fiscal-end. Unless the occupancy reaches around 70% level, hoteliers will restrain from increasing room rates," Khanna had said.

Raj Rana, chief executive officer (South Asia), Carlson Rezidor Hotel Group, said, "This 2014 has seen occupancy grew by two points which is heartening. Because in the face of the tremendous supply, for occupancy to finally start showing green shoots is very appealing which indicates that there is light at the end of the tunnel. Overall average rate is still under pressure. And average rate will still be under pressure in 2015 though occupancy will start improving."

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