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Worldwide Hospitality and Tourism Themes

Hospitality, tourism and economic growth in India


Vinnie Jauhari,
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Vinnie Jauhari, (2009) "Hospitality, tourism and economic growth in India", Worldwide Hospitality and
Tourism Themes, Vol. 1 Issue: 1, pp.7-11, https://doi.org/10.1108/17554210910949832
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Economic
Hospitality, tourism growth in India
and economic growth in India
Vinnie Jauhari
HP Labs Open Innovation Office, Hewlett-Packard India, Gurgaon, India 7
Abstract
Purpose – The objective of this paper is to provide a backdrop to the Worldwide Hospitality and
Tourism Themes (WHATT) theme issue on developments in hospitality and tourism in India and its
contribution to economic growth.
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Design/methodology/approach – The paper narrates the growth potential of tourism in India and
provides a perspective on the conduct of a roundtable discussion about economic growth.
Findings – The paper discusses the potential that tourism holds for India and its economic growth.
It also captures the essence of the roundtable which was conducted in 2008 to capture practitioners
perspectives.
Originality/value – This paper relates the growth of hospitality and tourism in India to the
country’s overall economic growth. The paper provides academic and practitioner perspectives on
some key issues.
Keywords Hospitality management, Tourism, Economic growth, Employees, India
Paper type Viewpoint

Tourism in India
The travel and tourism sector creates more jobs per million rupees of investment than
any other sector of the India economy (Tenth Five Year Plan 2002-2007, Government
of India). The evidence suggests that there is a significant role for tourism in
achieving the nation’s socio – economic objectives. The role envisaged for the private
sector in fact led to a process of disinvestment in 18 hotels by the India Tourism
Development Corporation. The contribution of the state has been seen as more
strategic in terms of infrastructure development, planning of broad development
strategies and in relation to fiscal and monetary incentives to catalyse private sector
investment. The Tenth Five Year Plan 2002-2007 notes: “In India for every
international tourist, there are 80 domestic tourists.” The World Travel & Tourism
Council (WTTC) has identified India as one of the world’s foremost tourist growth
centres in the coming decade. India is expected to achieve the fastest rate of growth,
with the total amount of economic activity likely to be generated by travel and
tourism predicted at 9.7 percent over the next ten years. As per the WTTC, the
Department of Tourism, Government of India estimates that tourism exports account
for 9.5 percent of India’s total exports and the number of people employed in the travel
and tourism segment is 25 million people. This has implications for the contribution
that the tourism sector in India is capable of. Worldwide Hospitality and Tourism
In order to realize its potential in tourism, India needs to provide internationally Themes
Vol. 1 No. 1, 2009
benchmarked tourist products and destinations to compete with other countries. pp. 7-11
India offers enormous advantages for those who are seeking a vibrant destination. q Emerald Group Publishing Limited
1755-4217
They include: DOI 10.1108/17554210910949832
WHATT .
A rich cultural heritage and one of the earliest civilizations, seedbed of so many
1,1 different religions, it offers a very rich cultural experience.
.
A diversity of languages, food and habits provide a very distinct experience as
one moves from one state to another.
.
A very varied topography with a range of experiences by the seaside and in the
mountains, deserts and plains.
8 .
Year round sunshine.
.
Increasing foreign direct investment and huge business opportunity for expansion.
The majority of the population in the working age group is young and can
contribute to the economy’s growth for a long time to come. This should yield a
significant opportunity for the growth of tourism and hospitality businesses not
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only as a consumer of these services but also as potential workforce.


.
English as a common language which facilitates ease of communication both
within India and it helps the nation to relate with foreign visitors too.
.
“Hospitality” as an integral ingredient of Indian culture and hotels – especially
the large branded Indian hotels provide a royal experience for the guest.
.
Indigenous health treatment options through yoga, meditation, ayurveda and
also advanced healthcare systems are available in India at much lower costs as
compared to other countries.

Despite all its natural and cultural advantages, there are plenty of challenges which
India faces in terms of developing hospitality and tourism so that it can contribute to
India’s economic growth. These have been recognized and acknowledged in numerous
government reports.
For instance, the Tenth Five Year document (2002-2007) of the Government of India
clearly identifies the following key issues that need to be addressed:
.
lack of private investment in tourism on account of insufficient legislative
support, policy integration and the taxation system;
.
infrastructure is a deterrent as modern airports, public transport and sanitation
facilities are needed at all tourist destinations;
.
the packaging of a destination experience is important so as to guarantee an
impeccable guest experience;
.
there is a need for better and more consistent training so as to enhance skill levels
in hospitality and tourism;
.
there are gaps in the marketing strategy of India as a tourist destination and in
its implementation;
.
the foreign visitor visa procedures are too complex;
.
there are some concerns in relation to the long-term sustainability of tourism
development, especially relating to the involvement of local communities,
addressing undeveloped but high potential destinations for tourism and the
conservation of natural resources; and
.
there is a growing threat from terrorism and from natural disasters associated
with climate change due to imbalances in the ecosystem.
Practitioner and academic roundtable dialogue Economic
This issue of Worldwide Hospitality and Tourism Themes (WHATT) aims to address a growth in India
key strategic question: what contribution will hospitality and tourism make in securing
sustainable economic growth in India? This issue is addressed in collaboration with
industry practitioners.
Based on inputs from academics and from hospitality and tourism experts, a
number of key issues were identified. The issued discussed closely relate to the Indian 9
Government’s analysis of tourism.
The key issues raised by industry experts were:
.
Infrastructure investments – transport, sanitation, water, electricity. There is
much investment required in building roads not only in metros but across rural
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districts and to religious places so as to attract a significant number of tourists.


.
Hotel and restaurant segment – growth avenues and strategies such as
franchising – support and related challenges. There is a need for robust growth
and sustainable brand strategies. There is also a need to achieve economies of
scale and standardization of the brand experience by the domestic hotel chains.
As franchising has been adopted as a route for growth, this helps in sustaining
the focus on industry enhancement. The cultural factors and building of trust in
relationships with local communities is also a key issue.
.
Education. Education plays a key role in driving growth in any sector.
Hospitality education in India has largely been focused on operations rather than
on developing management skills. This helps in terms of skill development and
in creating an employable workforce but for the majority, it may result in
restricted career growth.
.
Workforce practices. The culture of an industry drives innovation. The ability to
attract and retain talent makes a significant difference and the hospitality and
tourism industry faces many challenges in this area.
.
Destination management. Visiting any city or destination yields an overall
impression which is not easily compartmentalized. India’s infrastructure,
monuments, transport, IT, connectivity, hygiene and sanitation are all
contributors to this impression. So there is a significant infrastructure
challenge to be addressed if tourism destinations are to appeal to foreign
visitors, packaged appropriately and managed effectively.
.
Marketing efforts. Marketing investments are important in order to create and
make a meaningful difference to the nation’s image. Here, the deployment of
online marketing channels are likely to make a significant contribution in the
future.
.
Management of crisis situations. The growing threat of terrorism is worrying.
The recent explosions in Pakistan at the Marriott Hotel and the very recent
terrorist attacks on leading hotel chains in India – Taj and Oberoi properties in
Mumbai are a case in point. These incidents indicate the vulnerability of
hospitality firms in terms of dealing with crisis situations.
WHATT Approach to the roundtable discussion
1,1 In order to explore these aspects of hospitality and tourism development in India a
roundtable discussion was organized in November 2008 under the aegis of the Institute
for International Management and Technology. After identifying the key themes,
questions were identified in each of the areas which were discussed in the roundtable.
These are outlined as follows:
10 (1) General sector related aspects:
.
What contributions will hospitality and tourism make in securing
sustainable economic growth in India? What are the key elements in this
sector that can drive the growth?
.
What are the key challenges that need to be addressed?
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(2) Hotels – budget segment and franchising:


.
What are the most sustainable models for entrepreneurship in the hotel
sector in India?
.
How feasible is franchising as a development option?
. What are the key challenges in terms of choosing and managing franchisees?
(3) Education and workforce issues:
.
Is the current education infrastructure sufficient?
.
What are the educational gaps that need to be addressed?
. What are the workforce issues that are most important to industry?
.
What are the gaps that need to be addressed from a workforce perspective –
from entry level to management level?
(4) Destination management:
.
What aspects of destination management need to be addressed?
.
What are the key challenges in India for enhancing and managing the image
of India’s tourist destinations?
.
Where and what are the success stories that India can learn from?
(5) Web-based communication methods of marketing:
.
What online methods of communication are likely in future? How will
prospective customers interact?
.
What impact will web-based marketing have on the growth of tourism and
its suppliers?
(6) Crisis management:
.
Which aspects of crisis management need most attention?
.
What kind of strategies should hospitality firms adopt to deal with the crisis
situations arising from financial downturns, acts of terrorism and natural
disasters?

There are six articles in this thematic issue that relate to the key questions identified above.
In terms of a response to these questions, the article authors have incorporated the views of
practitioners and aspects of the roundtable discussion in their analysis. In this way, the Economic
issue blends secondary research and commentary with practitioners perspectives.
In this respect, the findings and conclusions from each article address the main
growth in India
topics discussed (workforce issues, destination management, aspects of franchising,
marketing of budget hotels chains through online channels, sustainable tourism) and
they mainly validate the points arising from practitioners inputs.
11
Outcomes of the roundtable
A rich medley of sub-themes emerged from the roundtable discussion. These related to:
.
the status of hospitality and tourism in terms of government budget allocations
and its implementation plan for tourism development;
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.
the processes for setting-up hotels and the series of licenses required, along with
procedures;
.
shortages of manpower at all levels;
.
the status of the hospitality curriculum;
.
the nature of training and the pedagogy adopted for training people;
.
high levels of attrition in the workforce;
.
leadership planning and training;
.
competencies and capabilities for large-scale expansion and project
management;
.
the legal framework for managing growth through franchising;
.
franchising as a promising option for growth;
.
hospitality and tourism as a key contributor to India’s growth and employment
potential;
.
the marketing of India’s main tourist destinations;
.
the pressing need to invest in world class infrastructure;
.
the management of crises and investments in training so as to protect assets and
guests;
.
the deployment of online channels for marketing – an increasing priority; and
.
matching the delivery process with expectations raised via the government’s
“Incredible India” tourism marketing campaign.

Detailed solutions and discussion are documented in the theme issue’s concluding
article. The proposed solutions were very much in keeping with the main findings of
review conducted by the theme issue’s team of researchers and writers.

Corresponding author
Vinnie Jauhari can be contacted at: vinnie.jauhari@hp.com

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This article has been cited by:

1. Ramphul Ohlan. 2017. The relationship between tourism, financial development and economic growth
in India. Future Business Journal 3:1, 9-22. [Crossref]
2. Shashi Shekhar Mishra, Vishal Bansal. 2017. Role of source-destination proximity in international
inbound tourist arrival: empirical evidences from India. Asia Pacific Journal of Tourism Research 22:5,
540-553. [Crossref]
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