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ECONOMIC AND SOCIAL COMMISSION FOR ASIA AND THE PACIFIC

UNITED NATIONSNew York. 1992

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A study on the economic impact of tourism in India was undertaken in response to therequest of the Government of India with financial assistance from the Government of Japan. Thereport was prepared by Mr. G. Aaveendran and Mr. M.A. Saluja, Consultants.

The views expressed in the report are those of the authors and do not necessarily reflectthose of the United Nations. The designations employed and the presentation of the material in thispublication do not imply the expression of any opinion whatsoever on the part of the Secretariat of theUnited Nations concerning the legal status of any country, territory, city or area, or of its authorities,or concerning the delimitation of its frontiers or boundaries.

This document has been issued without formal editing.

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CONTENTS

NO.CHAPTERS

INTRODUCTIONPOLICY AND PLANNING 5I

INTERNATIONAL TOURIST ARRIVALS IN INDIA.. 15II25TOURISM RECEIPTS.V

DOMESTIC TOURISM IN INDIA 33INCOME AND EMPLOYMENT EFFECTS OF TOURISM 41IMEASUREMENT OF INDIRECT AND INDUCED IMPACTS OF TOURISM 69II

83OLICY RECOMMENDATIONSANNEXURES

89NPUT-OUTPUT COEFFICIENT MATRIX (61x61)OF INDIAN ECONOMY (1983-84)LEONTIEF INVERSE MATRIX FOR 60 SECTORS OPEN MODEL 105ILEONTIEF INVERSE MATRIX FOR 61 SECTORS CLOSED MODELII

SCHEDULES

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CHAPTER I

INTRODUCTIONObjectives of the StudyTourism is essentially an expression of natural human instinct for experience, education and

entertainment. The motivations for tourism also include social, religious and business interests. Theeconomic consequences of this phenomenon are wide ranging and capable of influencing the developmentprocess of several nations. Many of the developing countries have, however. not been able to takeadvantage of it in full measure due to a variety of reasons including lack of information on the significanceof tourism in the economy. particularly with regard to its contribution to national income. employment andtax revenue. As a result, tourism is not given the required priority in the national development plans of thesecountries.

Recognizing the need for having a systematic approach to resolve the situation, the Economicand Social Commission for Asia and the Pacific (ESCAP) developed guidelines for the application of input-output techniques for determining the impact of tourism in any country. A number of case studies were alsosponsored by the ESCAP to assist its member countries including India to undertake objective evaluationsby using the guidelines. The basic objective of this study is to obtain a set of statistical indicators whichwould describe the significance of tourism in the Indian economy. The specific components of the studyinter -alia include the following:-

i)ii)iii)iv)v)

Review of trends in international tourist traffic to India.Study of the profile of foreign tourists visiting India.Study of expenditure pattern of foreign tourists.Review of dimensions of domestic tourism.Estimation of direct impacts of tourism on national income, employment, government revenueand balance of payment.Estimation of indirect impacts and multiplier effect.

Methodology and Data SourcesThe study essentially involved a systematic analysis of historical data on tourism development in

India, an assessment of the profiles of foreign and domestic tourists and the application of input-outputanalysis on their expenditure pattern. The time series data on tourism were available from variouspublications of Department of Tourism and Planning Commission. The profiles of tourists and thecharacteristic features of their demand were obtained from foreign and domestic tourist surveys. The Input-Output Transactions Table (IOTT) of Indian economy was available from the Central Statistical Organiza-tion (CSO) for the year 1983-84. The published 1-0 tables contained 60 sectors including hotels andrestaurants.

The first step in the study was to compile all the available data on Indian economy and tourism fromvarious sources including population censuses, economic censuses, enterprise surveys, etc., andestablishment of their comparability with the 1-0 tables. The significance of hotels and restaurants in theIndian economy was also studied separately to establish a relationship between tourist expenditures andthe value of output of the sector.

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The Reserve Bank of India (RBI) compiles the estimates of foreign exchange earnings from tourismas a part of balance of payment statistics. The latest estimate available from the RBI was for the year 1988-89. Provisional estimates worked out by the Department of Tourism on the basis of foreign tourist arrivalsand average expenditure per tourist were available for the later years. There was a problem 9fcomparability in the RBI estimates as the method of estimation was partly revised during 1983-84. Someadjustments were, therefore, made in the estimates to make them comparable over the years.

There is no regular mechanism for estimating the expenditure of domestic tourists on a year to yearbasis. Though a survey of domestic tourists conducted during 1981-82 provided some estimates of totalexpenditure, it was considered to be less reliable due to partial coverage of the tourist centres. Theestimate for 1983-84 was, therefore, derived indirectly by using the results of Enterprise Survey 1983-84on hotels and restaurants.

The profile and expenditure pattern of foreign tourists were available from surveys being conductedin India almost once in five years. The latest survey was conducted during 1988-89. A new approach calledSplit Sampling Technique was used for the first time in the 1988-89 survey. The technique essentiallyinvolved the use of different sub-samples for collecting information on items relating to different aspects.In fact, the various items of information were grouped into three different categories. The first group ofitems related to demographic variables, motivational aspects and places of visit in India. All theclassificatory variables and those with large variances were included in this group. The second groupsrelated to the expenditure pattern and the third group to perceptions and evaluation of tourism infrastruc-ture.

The first and second groups of variables were included in one schedule and those in the first and thirdgroups were included in another schedule. These two schedules were used alternately for interviewing thetourists.

A Survey of tourists at their places of stay was also undertaken to validate the results of the exitpoint survey and for assessing the expenditure pattern of the tourists in detail. The schedules used for thesurvey are annexed at the end of the report (Schedules I to III).

In general, a stratified two-stage sampling design was adopted forthe exit point surveys. In the firststage, random periods of time during the survey year were selected for each of the exit points. In thesecond stage, tourists leaving the country through the exit points during the sample periods were selectedsystematically for interviewing. In the case of major international airports at Bombay, Calcutta, New Delhiand Madras, the fifty two weeks of the year were divided into 13 periods of four consecutive weeks each.During each of the four weeks period, the four airports were surveyed for a week each in a random order.Tourists were selected from all the international flights departing from the airport during the selectedweek. The sampling fraction was variable depending on the volume of traffic. At the other exit points, thesurvey was conducted less frequently and the time periods were selected carefully to cover both lean andpeak tourist seasons.

A stratified multistage sampling scheme was adopted for the survey of tourists in the accommoda-tion units. Each of the cities of Bombay, Calcutta, Delhi, Madras, Goa and Varanasi constituted a stratumand the accommodation units in these cities were classified into luxury, moderate and economy classes toform three substrata. The luxury class included five star and deluxe hotels while three star and four starhotels constituted moderate class and all other hotels formed the economy class. The first stage unit oftime periods for the survey were selected as the two days following the period of survey in the respectiveairports. The required number of accommodation establishments were then selected from each substra-tum by using simple random sampling. All the foreign tourists who were staying in the selected hotelsduring the previous night were then listed and a random sample was selected for the purpose of the survey.The total sample size for the survey was fixed as 5,000 tourists and they were allocated over various strataon the basis of the percentage of tourists spending at least a night in those cities. They were furtherdistributed over various substrata on the basis of the pattern of use of accommodation units by the foreigntourists.

The expenditure data were, then, collected from the selected tourists for the previous day andfor the period since the arrival in the country...

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The profile and expenditure pattern of domestic tourists were obtained from two surveys conductedduring 1981-82. The first survey covering 55 centres was conducted as a part of the study on EmploymentPotential of Tourism in India and the second survey was a Pilot Study on Domestic Tourism , covering 22centres. In both the surveys, the centres were selected purposively to coverthe tourists of different incomeclasses, purposes and interests. The sample size was fixed apriori and distributed among different centreson the basis of their importance.

The patterns of expenditure revealed by the foreign and domestic tourist surveys were furtheradjusted to conform to 1-0 tables by using transport and trade margins estimated by the Central StatisticalOrganization (CSO). The adjusted expenditure vectors were used for deriving direct, indirect and inducedimpacts in the economy in terms of income, employment and tax revenue.

The impact analysis was carried out by using both open and closed 1-0 models. In the closedmodel, the private consumption expenditure was taken as the last column and the sector-wise value addedfigures were taken as the last row. The computation of inverse matrices and their multiplication withexpenditure vectors were carried out by using standard software packages in personal computers. Theresults thus obtained were used to evaluate the significance of tourism in comparison to other sectors ofthe economy.1.3 Problems and Limitations

Tourism is a composite industry consisting of several segments whose products and services arebeing used both by the local population and tourists. Some of these segments like travel agents, touroperators,

tourist transport operators, guide services, etc., still do not find a place in the statistical systemof the country and as such no worthwhile information is available about them. An attempt was, therefore,made to collect statistical information about this sector through a survey (Schedule IV annexed). Even inthe case of sectors for which data are available on a regular basis it was not possible to quantify the servicesprovided to tourists separately. The validation of the estimates of tourist expenditure from the performancedata of industries was, therefore, not feasible.

There were serious problems in the comparability of data available from population censuses,economic censuses, follow-up surveys and other regular surveys due to differences in concepts, definitionsand methodology. The employment data were also not available according to the classification of sectorsfollowed in the 1-0 tables. The estimation of employment coefficients became difficult because of thesedata problems and it introduced a kind of upward bias in some of the sectors.

A major difficulty in the completion of the study was the non-availability of data on the use ofimported raw materials by various sectors. As a result, it has not been possible to estimate the additionalimport requirements in the economy due to tourist expenditure.

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CHAPTER II

TOURISM POLICY AND PLANNING

Tourism as an Instrument of Economic Development.1The development process in the history of nations is basically a set of human activities. These

activities invariably relate to the physical and phsycological needs of people at any given point of time. Ingeneral, the basic human instincts, his social and economic needs and desire for materialistic comforts arethe main factors which activate the development process.

It is a basic human instinct to travel and experience the diversities of life. This universalphenomenon cuts across all artificial barriers and boundaries of nations. The motivations of travel are,however, varied and diverse. Many nomadic tribes travelled across the vast lands of earth in search of foodand wealth in the pre-historic age. There were also many conquerors who went across the countries inquest of new treasures. With the onset of civilization, the motivations of travel also assumed new forms.The community of business travellers, explorers and pleasure seekers emerged as new group of tourists.Technological advances in the twentieth century opened up new horizons for travel. The distancesbetween different countries of the world reduced due to advances in the fields of aviation and communi-cation. Better transport facilities and comforts also became an inducement for travel.

The post world war period witnessed spectacular economic growth in many countries and as aconsequence the disposable income of people increased substantially. This increased purchasing power,coupled with more leisure time and paid holidays as well as changes in consumer demand for non-materialgoods induced a boom in tourist movements across the world. Over a short span of time, tourism emergedas one of the most significant economic and social activities of the world. It soon becamA a vital instrumentfor economic growth and social change in several countries.

Recognition of Tourism in India.2The recognition of tourism as an instrument of economic and social development has been rather

late in most of the developing countries including India. It was only during 1946, the importance of tourismwas first recognized in India when a Committee under the Chairmanship of Sir John Sargeant wasappointed to advise the Government on the development of tourism. The Government of India took noteof tourism phenomenon and its economic implications only thereafter and led to the establishment of a 'TouristTraffic Branch' in 1949 in the Ministry of Transport. In 1952, the Government of India opened a tourist oriiceat New York and began a close relationship between the Department of Tourism and Air India in promotingtourist traffic to India. In 1955, the Air India established a Tourism Cell in their headquarters at Bombayand a Government of India Tourist Office was opened at London. Another significant development duringthe period was the expansion of the Tourism Section in the Ministry of Transport into a full-fledgedDirectorate of Tourism in 1958 .

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2.3 Second Five Year Plan (1956-61)Tourism became a constituent of national development plan during Second Five Year Plan (1956-61) with an allocation of As. 33.63 million including As. 17.84 million in the State sector. The emphasis

during this plan was mainly on providing accommodation, transport and recreational facilities at importanttourist centres, especially those situated in far off places. Broadly, the development schemes taken upduring the Plan could be classified into three categories viz (a) schemes for the development of facilitiesat a limited number of places visited largely by the foreign tourists and wholly financed by the CentralGovernment, (b) schemes intended to provide facilities for domestic tourists at centres visited both byforeign and domestic tourists and financed both by Central and State Governments in the ratio of 50:50and (c) schemes which were wholly financed and executed by the State Governments for the developmentof centres of regional and local importance. The allocation and expenditure on those schemes during thePlan period are given in table 2.1.

TABLE 2.1ALLOCATION AND EXPENDITURE FOR TOURISM SCHEMES DURING

SECOND FIVE YEAR PLAN(Rs. in million)

Category Central Sector State Sector Total

8.357.44

abc

3.754.94

8.3514.8810.40

3.759.888.50

-7.44

10.40-4.948.50

TOTAL 15.79 8.69 17.84 13.44 33.63 22.132.4 Third Five Year Plan (1961-66)

The tourism development programmes for the Third Five Year Plan (1961-66) were also largelyconcentrated on the provision of facilities like accommodation and transport except for a major scheme forthe establishment of a Winter Sports Complex at Gulmarg in Jammu and Kashmir State. The Plan periodthus witnessed the beginning of an era for the development of activities connected with tourism,particularly adventure tourism. The total plan allocation was As. 80 million including As. 45 million in theState sector. The categorywise allocation and expenditure during the Plan period are given in table 2.2.

TABLE 2.2ALLOCATION AND EXPENDITURE FOR TOURISM SCI+EMES DURING

THIRD FIVE YEAR PLAN(Rs. in million)

Category Central Sector State Sector TotalAllocation Expenditure Allocation Expenditure Allocation Expenditure

29.205.80

abc

9.744.77

29.2011.6039.20

9.749.54

31.76

-5.80

39.20

-4.77

31.76TOTAL 35.00 14.51 45.00 36.53 80.00 51.04

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There were also a number of other significant developments during the Plan period which couldbe regarded as land marks in the evolutionary history of Indian tourism. A committee under theChairmanship of Shri L .K. Jha, the then Secretary, Department of Economic Affairs was set up by theGovernment in 1962 to suggest ways and means for increasing the flow of tourist traffic to India. The termsof reference of the committee included the following:-

(i) assess the requirements of tourism in respect of hotel accommodation and transportarrangements and suggest necessary measures for the speedy provision and improvementof these facilities;

(ii) examine the existing rules and procedures regarding visas, customs and other formalitieswith a view to facilitate entry and exit of tourists;(iii) recommend necessary reorganization of publicity programmes and other steps required tobring about the desired expansion of traffic; and(iv) suggest measures necessary to ensure that the foreign exchange earned from tourism andresulting from its expansion is protected against leakages.

The committee in its report submitted to the Government in 1963 , made several recommendationscovering almost all aspects of tourism development in the country including travel formalities, airport andtransport facilities, hotels, publicity and promotion, shopping and entertainment facilities, development oftourist centres and training of personnel for tourism. By and large, these recommendations were acceptedand implemented by the Government.

One of the recommendations of Jha Committee was to set up a Corporation which could take oversome of the functions of the Department of Tourism such as publicity and promotion abroad. The IndiaTourism Development Corporation (ITDC) was thus established in 1966 to develop infrastructure andpromote India as a tourist d'estination.

In the aviation sector, the Government agreed in 1965 to allow tourist charters by non-scheduledcarriers to come to India. The total number of such charters were, however, limited to 50 per year.Annual Plans (1966-69).5The basic approach towards tourism development and the commitment of the Government

continued to be the same during the Annual Plans from 1966 to 1969. The allocation and expenditureduring these three Plan years are given in table 2.3.

TABLE 2.3ALLOCATION AND EXPENDITURE FOR TOURISM SCHEMES DURING

ANNUAL PLANS FROM 1966 TO 1969in million)

Category Totalentral Sector State SectorExpenditu re Allocation Expenditure Allocation Expenditurellocation

6.933.44

16.7516.2436.99

6.936.88

27.8616.75

8.12abc

-8.12

36.99

-3.44

27.86TOTAL 10.37 45.11 31.30 69.98 41.674.87

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TABLE 2.5ALLOCATION AND EXPENDITURE FOR TOURISM SCHEMES

DURING FIFTH FIVE YEAR PLAN(As. in million)

Central Sector(a)(b)State Sector

DepartmentITDG 179.69127.90285.23142.51115.73291.37

TOTAL 592.82 549.61

TABLE 2.6ALLOCATION AND EXPENDITURE FOR TOURISM SCHEMES

DURING ANNUAL PLANS FROM 1978 TO 1980 (As. in million)Sector Allocation Expenditure

Central Sector(a)(b)State Sector

DepartmentITDC 56.97127.32267.6635.26127.80213.25

TOTAL 451.95 376.31

2.9 Sixth Five Year Plan (1980-85)The Sixth Plan (1980-85) spelt out the objectives of investment in the tourism sector as (i)

optimisation of the use of existing capacity, and (ii) to increase substantially the tourist accommodation inthe public and private sectors. The outlay provided forthe sector during the Plan period was As. 1,799.60million including As. 1,129.60 million in the State sector. The emphasis in the programmes of Departmentof Tourism was on the development of selected beaches, mountain resorts, wild life and cultural tourism,training and overseas promotion. The loan assistance scheme to hotels was converted into interestsubsidy scheme through Industrial Finance Corporation of India. In the case of ITDC, the expenditure wasincreased to As. 534.72 million beyond the original allocation, mainly for large scale capacity expansionand equity participation in the joint venture projects with State Governments. An important developmentduring the Plan was the establishment of Indian Institute of Tourism and Travel Management (IITTM) in1983 as an apex institution for tourism education. The categorywise allocation and expenditure during thePlan period are given in table 2.7.

TABLE 2.7ALLOCATION AND EXPENDITURE FOR TOURISM SCHEMES

DURING SIXTH FIVE YEAR PLAN(As. in million)

Central Sector(a)(b)State Sector

DepartmentITDC 211.13534.721,143.63

TOTAL 1,799.60 1,889.48

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250.00420.001,129.60

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2.10 Tourism Policy 1982By the beginning of Sixth Plan, tourism emerged as an important segment of Indian economy

contributing substantially to foreign exchange earnings, employment generation and backward areadevelopment. The Government, thus came out with a written policy on tourism in the year 1982. Theendeavour of the Government in the field of tourism was clearly spelt out in the Policy as stated below:-

The many attractions of India hold virtually an unlimited potential for tourism development.The endeavour, therefore, will be to convert this vast potential into reality through well-planned, well-defined and fully integrated national programmes of tourism development.

The objectives of the tourism development programmes were further spelt out as :(i) It becomes a unifying force nationally and internationally fostering better understanding

through travel.(ii) It helps to preserve, retain and enrich our world view and life style, our cultural expressions

and heritage in all its manifestations. The prosperity that tourism brings must cause accretionand strength rather than damage to our social and cultural values and depletion of our naturalresources. In tourism, India must present itself on its own terms -not as an echo or imitationof other countries, other cultures and other lifestyles.

(iii) It brings socio-economic benefits to the community and the State in terms of employmentopportunities, income generation, revenue generation for the States, foreign exchangeearnings and, in general, causes human habitat improvement.

(iv) It gives a direction and opportunity to the youth of the country both through international anddomestic tourism to understand the aspirations and viewpoints of others and thus to bringabout a greater national integration and cohesion.

(v) It also offers opportunities to the youth of the country not only for employment but also fortaking up activities of nation building character like sports, adventure and the like. Thus asa programme for the moulding of the youth of the country, tourism is of inestimable value.

The policy also specified the responsibility for tourism development as a common endeavour. Itstated; While broadly the promotion of international tourism would be mainly the responsibility of theCentral Sector, and that of domestic tourism primarily of the State Sector, the Centre would playacoordinating role supplementing the State effort wherever necessary. Further, tourism developmentcannot solely be the responsibility of the Government. It has to be a common endeavour of all the agenciesvitally concerned with its development at Central and State levels, of public sector undertakings and theprivate sector, of airlines, railways and communication systems, municipal and local bodies andeducational and cultural organizations. This combined effort would be directed towards achieving acomprehensi

well-rounded and integrated development enabling tourism to make a positive andeffective contribution to the economic growth of the country .

The policy also laid down a plan of action to maximize the benefits of tourism. The developmentof tourism infrastructure was proposed to be taken up in a 5 to 10 year perspective based on a travel-circuit concept. It was intended to achieve intensive development of selected centres, dispel the tendencyof concentration in a few urban centres, encourage the diversification of tourist attractions and openingup economically backward areas which hold many tourist attractions. To involve the youth of the countryin national integration and make tourism a vehicle for achieving this objective, youth hostel activities weregiven significant importance. In order to augment tourism facilities for the lower middle class and the poorersections of the society, cheap accommodation in the form of 'Oharamshalas' , Sarais', etc., were proposedto be provided. Marketing strategies were required to be adopted to broaden the tourist base in existingmarkets, explore new tourist markets and promote and facilitate intra-regional travel, particularly fromneighbouring countries. M-anpower development and training were also to be given due weightage toensure efficient service and effective management of tourist facilities. The tourism development in SixthPlan was thus supported by a well documented national policy which became the basis for all theGovernment initiatives.

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Seventh Five Year Plan (1985-90)The Seventh Five Year Plan (1985-90) recognized tourism as a priority sector and sought to

provide the most needed support facilities for its sustained growth. The sector was accorded the status ofan industry and its development was included as a plan objective for the first time in the planning process.The objectives of the tourism plan were stated as (i) redefining of the role of public and private sectors toensure private investment in developing tourism and to direct public sector investment mainly on thedevelopment of support infrastructure, and (ii) exploiting tourism potential to support local handicrafts andother creative arts to promote national integration. The thrust areas of tourism planning were designatedas follows:-

Development of selected tourist centres/circuits which are popular with the tourists instead ofspreading limited resources thinly over a large number of circuits.Diversification of tourism to India from the traditional sight seeing tours to the more rapidlygrowing holiday tourism market within the framework of country's milieu with a consciousattention to the aesthetic, environmental and socio-cultural implications of tourism projects.Development of non-traditonal areas such as trekking, winter sports, wild life tourism, etc.Promotion of India as a unique place of cultural tourism destination and to utilise tourism asa major force in support of conservation of national heritage.Exploration of new tourist markets particularly in the Middle East and East Asian countrieswho have cultural affinity with India and launching of a programme of Discover Your Rootsand vigorous marketing of conference and convention traffic.Launching of a national image building and marketing plan in key markets by pooling theresources of various public and private agencies instead of independent and disjointed effortsundertaken by those organizations to project a better image of the country.Provision of inexpensive but clean accommodation at different places of tourist interest.Consolidation of operations rather than expansion, and improvement in the service efficiencyof public sector corporations in the tourism sector.Streamlining of facilitation procedures for passengers at the airports so that formalities andtime taken to complete them are minimal.

In line with the priority assigned for the sector, the Plan outlay for tourism promotion was alsoincreased during Seventh Plan. The total allocation was kept at As. 3,261.50 million including As. 1,874.70million in the State sector. The sectorwise allocation and expenditure are given in table 2.8.

TABLE 2.8ALLOCATION AND EXPENDITURE FOR TOURISM SCHEMES

DURING SEVENTH FIVE YEAR PLAN(As. in million)

Sector Allocation ExpenditureCentral Sector

(a) I(b) I

State SectorDepartmentITDG 986.80400.00

1,874.701,511.70488.702,369.50

TOTAL 3,261.50 4,369.90

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The major schemes for tourism development in the Central Sector included Integrated develop-ment of Budhist Pilgrimage centres, construction of inexpensive accommodation units like Yatrikas andYatriniwases at different places to meet the demand of budget tourists, provision of wayside facilities forhighway tourism, development of beach and hill resorts, adventure tourism and watersports, promotion offairs and festivals, etc.. Considerable step up was also made in the outlay for overseas publicity andmarketing. In the case of ITOC, the Plan envisaged sustained efforts to improve the profitability of itsexisting hotels through different measures including improvement in the occupancy ratio. ITOC was alsoassigned the task of constructing hotels of 3-star category as joint venture projects with State Govern-ments.

Study on Tourism Policy (1987)In recognition of its increased importance, the Lok Sabha Secretariat of Indian Parliament made astudy on the Tourism Policy of Government of India in 1987. The study recognized tourism as a catalyst

to economic growth, a melting pot of different cultures and a vital force for world peace.National Committee on Tourism (1986-88)A significant development during Seventh Plan period was the constitution of a National Committee

on Tourism (NCT) by the Government to evaluate the economic and social relevance of international anddomestic tourism of India, define the roles of Central Ministries, State Government. Public and PrivateInstitutions and recommend proposals for drawing up a long term plan for promoting the growth of tourismon desired lines. The specific terms of reference of the Committee were the following:-

Evaluate the economic and social relevance of international and domestic tourism in India.Define the tourism product, its present and future variation, keeping in view the market needsand demands.Determine the requirements of a balanced, integrated infrastructure and facilitationmeasures to achieve the maximum consumer satisfaction.Develop a planned market strategy based on scientific research and consistent with on-goingresponses of the market needs through a realistic communication strategy.Determine and define the role of the Central Ministries, State Governments, Public andPrivate institutions in the promotion of tourism and suggest a mechanism for monitoring theperformance of these agencies against the well defined economic yardstick.Assess the manpower needs for development of tourism sector and to recommend appropriatetraining programmes for manpower development.Recommend organizational and institutional measures to systematise long term planing forthe tourism sector 9n a sound technical and economic basis.

The Committee in its report submitted to the Government in 1988 highlighted the significance oftourism in the Indian context and made several recommendations which mainly included a package ofincentives for attracting private investment in the tourism sector, suggestions for organizationalrestructuring of Central and State institutions and measures for meeting the manpower requirements of thesector. This report soon became the basis of tourism policy and planning in India. The major initiatives thatfollowed were (i) establishment of a Tourism Finance Corporation (TFCI) in 1989, (ii) provision of a numberof fiscal and financial incentives for investment in tourism sector, (iii) liberalisation of air charter policy, (iv)streamlining and simplification of travel formalities, (v) improvement of facillitation services at the airports,(vi) diversification of tourism resources, and (vii) expansion and improvement of training facilities in the fieldof tourism.

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2.14 Annual Plans (1990-92)The Annual Plans 1990-91 and 1991-91 were virtually the continuation of the policies and

programmes initiated during Seventh Plan except that the Plan allocations were substantially increasedand infrastructural development schemes were given added importance. The Plan outlay and expenditureduring the year 1990-91 and the allocation and anticipated expenditure for 1991-92 are given in table 2.9.

TABLE 2.9ALLOCATION AND EXPENDITURE FOR TOURISM SCHEMES DURING

ANNUAL PLANS 1990-91 AND 1991-92(As. in million)

Central Sector(a) Department(b) ITDCState Sector

675.00155.00644.30

577.7089.10648.04

740.00160.00844.60

701.5098.00805.50

TOTAL 1,474.30 1,314.84 1,744.60 1,605.00

(*): Anticipated

2.15 An OverviewIn the context of India, tourism was not even considered as an economic activity till independence

in 1947. It also did not find a place in the constitution of India, though some of its components werespecifically mentioned in the schedules indicating the allocation of business between Central and StateGovernments. The realisation of tourism as an economic force was first expressed in the appointmentof Sargeant Committee, and the report of the committee clearly spelt out the significance of tourism ina national perspective. It led to the establishment the Tourist Traffic Branch in the Ministry of Transportin 1949. The First Five Year Plan of the country, however, did not take note of the tourism phenomenonand the sector remained without a separate plan allocation. Tourism became a constituent of planningprocess in the Second Five Year Plan with a small allocation of As. 33.63 million. The sector receivedincreasingly greater attention over successive five year plans and the real breakthrough was achievedduring Sixth and Seventh Plans. Tourism was also accorded the status of an industry during Seventh Planperiod.

The plan-wise allocations and expenditures are summarized in table 2.10.

TABLE 2.10PLAN ALLOCATIONS AND EXPENDITURES FOR TOURISM OVER

SUCCESSIVE PLAN PERIODS(As. in million)

Second Plan(1956-61)Third Plan(1961-66)Annual Plans(1966-69)Four1h Plan(1969-74)

15.79 8.69 17.84 13.44 33.63 22.132. 35.00 14.51 45.00 36.53 80.00 51.04

24.87 10.37 45.11 31.30 69.98 41.674. 348.08 250.53 110.80 163.18 458.88 413.71

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(As. In million)51.No.

Plan Central Sector State Sector TotalAllocation Expenditure Expenditure Allocationllocation Expenditure

5. Fifth Plan(1974-78)Annual Plans(1978-80)Sixth Plan(1980-85)Seventh Plan(1985-90)Annual Plan(1990-91 )Annual Plan(1991-92)

307.59 258.24 285.23 291.37 592.82 549.616. 184.29 163.06 267.66 213.25 451.95 366.657. 670.00 745.85 1.799.60.129.60 1,143.63 1.889.48

1,874.70. 1,386.80 2,000.40 2.369.50 3,261.50 4,369.901.474.30. 830.00 666.80 644.30 648.04

799.50 805.50 1.744.600. 900.00 644.60 1.605.00

Source: Planning Commission

The tourism policy was evolved over a period of several years since 1949 and the inputs providedby various committees and working groups were incorporated in the policy document of 1982. India alsohad the previlege of learning from the experiences of other nations while formulating its tourism policy.In essence, the Government of India has adopted a progressive attitude towards tourism with adequatesafeguards to protect the ecology, environment and socio-cultural systems of the country. Tourism hasnow been recognized as an important segment of Indian economy with considerable potential fordevelopment.

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CHAPTER IIIINTERNATIONAL TOURIST ARRIVALS IN INDIA

3.1 Growth in Tourist ArrivalsAccording to the definition followed in India "an international tourist is a person visiting India on a

foreign passport, staying at least twenty-four hours in the country and the purpose of whose journey canbe classified under one of the following:i) leisure (recreation, holiday, health, study, religion and sport).ii) Business, family, mission, meeting.Nationals of Nepal entering India through land routes and the visitors arriving through Indo-Bhutanborder are not included in the foreign tourist arrival statistics.Though international tourists have been visiting India since ancient times, a count of such visitorswas first taken only during 1951, and on the basis of the same, the country received 16,829 tourists during

that year. Over a period of nine years since then, the visitors to India exceeded 123 thousands per yearby registering an annual rate of growth of about 24.7 per cent. The next decade from 1960 to 1970,however, witnessed a low rate of growth of about 8.6 per cent per year and arrivals exceeded 280thousands by 1970. The tourist arrivals received a greater momentum during the decade from 1970 to 1980and by 1976 the arrivals reached half a million. It thus took about 25 years since 1951 for the tourist arrivalsto reach at least a moderate level and by 1980 it went upto over 800 thousands. The average annual rateof growth during the decade was about 11 per cent. The period from 1980 to 1990 registered widefluctuations in growth rates which ranged fro n -5.6 per cent to 29.1 per cent. While the growth during theperiod from 1980 to 85 was almost negligible, the year 1986 registered a remarkable growth of 29.1per cent over the previous year. The arrivals also exceeded one million for the first time during that year.It, thus, took only ten years since 1976 for the arrivals to get doubled and cross the one million mark. Thetempo in growth was maintained till 1 989 with annual increases varying from 6.5 per cent to 7.8 per cent.The year 1990, however, recorded a decline of 0.5 per cent in tourist arrivals due to various national andinternational developments including the Persian Gulf crisis. The average rate of growth during the decadewas,

thus, only 5.2 per cent. Over a period of about four decades from 1951 to 1990, the growth rateachieved was 11.9 per cent per annum.As compared to an average annual rate of growth of 7.3 per cent in world tourist arrivals, the growthof tourism in India has been faster since 1951. The comparative growth rates during different decades are

given in table 3.1.TABLE 3.1

COMPARATIVE GROWTH RATES IN TOURIST TRAFFIC TO INDIA ANDWORLD TOURIST ARRIVALS OVER THE DECADES

Sl.No. Annual Growth RateIndian Arrivals World Arrivals1950-19601960-19701970-19801980-1990

24.78.611.05.2

10.68.76.04.2

3.4.

Sources; 1.2.

India Tourist StatisticsTourism Trends Worldwide and in Europe 1950-90 by World Tourism Organization (WTO)

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Though, there has been a phenomenal increase in the tourist arrivals over the years, the share ofIndia in the world tourism still continues to be around 0.3 per cent. A comparison of world tourist arrivalswith Indian tourism is given in table 3.2

TABLE 3.2COMPARISON OF WORLD TOURIST ARRIVALS WITH INDIAN TOURISM(Excluding the nationals of Pakistan and Bangladesh)

Year World TouristArrivals Tourist Arrivalsin India % Share of

MillionNumber Index1960=100 MillionNumber Index1960=100 India

1960197019801981198219831984198519861987198819891990

69.3159.7284.8288.8286.8284.2312.4322.7330.5356.8381.9414.2429.3

100.0230.4411.0416.7413.8410.1450.8465.6476.9514.9551.1597.7619.5

0.120.280.800.850.860.880.840.841.081.161.241.341.33

100.0228.1650.0693.1698.8718.7678.7679.9877.4945.41007.31086.31080.4

0.180.180.280.290.300.310.270.260.320.330.320.320.31

Sources: 1.2.

India Tourist StatisticsTourism Trends Worldwide and in Europe 1950-90 by World Tourism Organization (WTO)

The nationals of Pakistan and Bangladesh were not included in the tourist arrival statistics till 1980due to difficulties in collecting the data from a large number of land check posts. The arrivals from thesecountries were also subject to large fluctuations due to a variety of reasons. All types of analysis of foreigntourist arrivals in India, therefore, exclude these nationals. However, for providing a total picture, thecomparative figures including the nationals of Pakistan and Bangladesh are given in table 3.3.

TABLE 3.3COMPARISON OF WORLD TOURIST ARRIVALS WITH INDIAN TOURISM(Including the nationals of Pakistan and Bangladesh)

Year World TouristArrivals Tourist Arrivalsin India

% Share of

1981198219831984198519861987198819891990

100.099.398.4

108.2111.7114.4123.5132.2143.4148.6

100.0100.7102.093.398.5

113.4116.0124.3135.7133.4

0.440.450.460.440.390.440.410.420.420.40

Sources: 1.2. India Tourist StatisticsTourismTrends Worldwide and in Europe 1950-90 by World Tourism Organization (WTO)

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3.2 Tourist Generating Markets of IndiaThe primary tourist generating markets of India are West Europe and North America. These two

regions taken together accounted for about 55.6 per cent of the total arrivals during 1990. Individually, theshare of West Europe, has been increasing steadily over the years. It went up from 37.7 per cent in 1970to 43 per cent in 1990. The major countries in West Europe contributing to the Indian tourism are the United.Kingdom of Great Britain and Northern Ireland, France and the Federal Republic of Germany. While theshare of the United Kingdom increased from 15.4 per cent in 1970 to 17.7 per cent in 1990, the share ofthe other two countries remained almost static over the years. The United Kingdom is, in fact, the top touristgenerating country for India today.

The United States of America was on the top of all the countries till 1973. However, the share ofthis country declined steadily over the years and became 9.4 per cent in 1990 as compared to 20.9per cent in 1970.

West Asia with 8.5 per cent of the arrivals is another region which has emerged as an importanttourist market for India, though its contribution to the world arrivals is relatively insignificant. Over theyears,the share of this region in the total tourist traffic to India improved from 4.3 per cent in 1970 to 10.8

per cent in 1986. It, however, declined to 8.5 per cent in 1990 due to economic and political situationprevailing in that region.

Among the Asian countries, outside the South-Asia region, Japan and Australia are the two majorcontributors to Indian tourism. While the share of Japan was about 4.4 per cent during 1990, it was about2.8 per cent in the case of Australia.

A comparative analysis of tourist arrivals in Indian from different regions and important countries,excluding the nationals of Pakistan and Bangladesh is given in table 3.4.

TABLE 3.4YEARWISE TOURIST ARRIVALS FROM MAJOR MARKETS

United Kingdom

Federal Rep. of GermanyRest of West EuropeEast EuropeWest AsiaSouth-East Asia

United StatesCanadaAustraliaRest of the world

TOTAL

43,212(15.4)16,832(6.0)16,279(5.9)29,103(10.4)6,501(2.3)

12,170(4.3)20,009(7.1)9,432(3.4)

58,793(20.9)7,026(2.5)

11,901(4.2)49,563(17.6)

102,483(12.8)58,682(7.3)54,736(6.8)

101,931(12.7)20,362(2.5)38,801(4.8)78,106(9.8)30,575(3.9)78,608(9.8)23,783(3.0)22,630(2.8)

189,453(2:1.8)

119,544(14,3)

44,091(5,3)44,790(5.4)96,983(11.6)28,774(3.4)90,820(10.8)54,663(6.5)30,573(3.6)95,920(11.5)29,022(3.5)22,045(2.6)

179,681(21.5)

229,496(17.2)78,001(5.8)78,431(5.9)

186.443(13.9)59,624(4.5)

121,792(9.1)82,767(6.2)58,707(4.4)

134,314(10.0)40,306(3.0)30,443(2.3)

236,908(17.7)

235,151(17.7)79,496(6.0)70,346(5.3)

187,464(14.1)55,083(4.1)

112,383(8.5)87,911(6.6)59,122(4.4)

125,303(9.4)41,046(3.1)30,076(2.3)

246,569(18.5)

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3.3 Seasonality in Tourist ArrivalsThere is a high degree of seasonality in the foreign tourist traffic to India. The winter months ofOctober to December constitute the peak tourist season followed by the first quarter, January to March.

The summer months of April to June are the lean season with the lowest number of tourist arrivals. On thebasis of the tourist arrival figures for the last 10 years, the quarterly indices of seasonality have beenworked out and given in table 3.5.

TABLE 3.5aUARTERL Y INDICES OF SEASONALITY IN FOREIGN TOURIST ARRIVALS

1.2.3.4.

January-MarchApril-JuneJuly-SeptemberOctober-December

108.677.095.2119.2

3.4 Purpose of VisitHoliday and sightseeing is predominantly the main purpose of visit of foreign tourists visiting Indiaand the percentage of such tourists has been increasing continuously over the years. However, the

percentage of business tourists to India is on the decline. The distribution of tourists according to mainpurpose of visit during 1986 and 1990 are given in table 3.6.

TABLE 3.6DISTRIBUTION OF TOURISTS ACCORDING TO MAIN PURPOSE OF VISIT

81. No. Purpose 1986 1990Number Per cent Number Per cent613,262248,270110,03652,97313,773

1,96039,776

56.823.010.24.91.30.23.6

962,884227,421

74,47734,579

5,3202,660

22,609

72.417.1

5.62.60.40.21.7

2.3.4.5.6.7.

Holiday and sight-seeingBusinessVisiting friends and relativesStudyConference and missionCultural and socia functionOthersTotal 1,080,050 100.0 1,329,950 100.0

The results of foreign tourist surveys conducted during 1982-83 and 1988-89 also confirm thesteady increase in the percentage of pleasure tourists visiting India. While the pleasure tourists constituted43.0 per cent during 1982-83,it increased to 57.9 per cent by 1988-89. The comparative estimates aregiven in table 3.7.

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TABLE 3.7COMPARATIVE ESTIMATES OF TOURISTS ACCORDING TO MAIN

PURPOSE OF VISIT AS REVEALED BY SURVEYS

81. No. Purpose of visit Percentage of tourists1982-83 survey 1988-89 survey57.922.47.34.33.0

5.1

43.025.211.24.63.112.9

, .2.3.4.5.6.

PleasureBusinessVisiting friends and relatives (VFR)StudyPilgrimageOthers

100.0 100.0Sources: 1.2. Foreign Tourist Survey 1982-83Foreign Tourist Survey 1988-89

The percentage of pleasure tourists is the highest in the younger age group below 30 years andthat of business tourists is the largest in the middle age group of 31-50 years. The distribution of touristsaccording to age and purpose of visit as per 1988-89 survey is given in table 3.8.

TABLE 3.8PERCENTAGE DISTRIBUTION OF TOURISTS BY AGE AND

MAIN PURPOSE OF VISITAge Group1.No. Purpose of visit

Above 50elow 3156.618.17.10.64.2

13.4

65.414.04.6

10.23.91.9

53.628.29.01.52.35.4

1.2.3.4.5.6.

PleasureBusinessVisiting friends and relativesStudyPilgrimageOthers

100.0otal 100.0 100.0Source: Foreign Tourist Survey 1988-89

The pleasure tourists constitute the largest percentage in the case of France and Eastern Europeand the lowest in the case of Asian countries. The largest share of business tourists come to India fromJapan and other Asian countries. The percentage distribution of tourists by nationality and main purposeof visit according to 1988-89 survey is given in table 3.9.

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TABLE 3.9PERCENTAGE DISTRIBUTION OF TOURISTS BY NATIONALITY AND

MAIN PURPOSE OF VISITRegion Country Purpose of Visit

Pleasure Business Study Pilgrim Others Total63.474.063.967.471.640.744.148.359.964.967.541.7

24.817.223.518.717.127.527.932.817.821.824.025.0

5.71.84.43.88.7

15.79.23.13.93.75.4

13.2

1.82.83.34.70.05.73.94.45.02.21.68.8

1.11.83.11.70.91.43.46.2

10.42.71.03.1

3.22.41.83.76.79.0

11.55.23.04.70.58.2

100.0100.0100.0100.0100.0100.0100.0100.0100.0100.0100.0100.0

United KingdomFranceFederal Rep. of GermanyRest of West EuropeEast EuropeWest AsiaSouth-East AsiaJapanUnited StatesCanadaAustraliaRest of the world

TOTAL 57.9 22.4 7.3 4.3 3.0 5.1 100.0Source: Foreign Tourist Survey 1988.89

3.5 Distribution of Tourists by SexThe percentage of female tourists visiting India has always been low, though there is a gradual

increase in the recent past. The highest percentage of female visitors to India are fro:n Europe and theUnited States of America. The distribution of foreign tourists according to nationality and sex as per 1988-89 survey is given in table 3.10.

TABLE 10PERCENTAGE DISTRIBUTION OF FOREIGN TOURISTS

BY NATIONALITY AND SEXNationalityCountry/Region

Percentage TotalMale Female11.54.04.3

10.14.26.25.43.26.92.12.1

12.8

2.51.75.41.01.50.90.73.11.10.33.4

17.16.56.0

15.55.27.76.33.9

10.03.22.4

16.2

United KingdomFranceFederal Rep. of GermanyRest of West EuropeEast EuropeWest AsiaSouth-East AsiaJapanUnited StatesCanadaAustraliaRest of the world

72.8 27.2 100.0Source: Foreign Tourist Survey 1988-89

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3.6 Age-V'/ise Distribution of TouristsPredominantly the international tourists visiting India are in the economically active age-group of25 to 54 years. They constituted about 71.4 per cent of the total arrivals during 1989. Of the remainingtourists,18.3 per cent were below the age of 24 and 10.3 percent were above the age of 54. The highest

percentage of elder tourists are from South-East Asia followed by Japan. The percentage distribution oftourists according to age and nationality during 1989 is given in table 3.11.

TABLE 3.11DISTRIBUTION OF TOURISTS ACCORDING TO NATIONALITY AND AGE

Age-GroupsationalityCountry/Region 3.24 25.34 35.44 45.54 55+United Kingdom 21.1 25.0 25.7 16.2 12.0France 11.9 28.0 30.6 16.8 12.7Federal Rep. of Germany 10.9 28.7 29.5 21.6 9.3Rest of West Europe 11.1 32.9 30.5 17.0 8.5East Europe 8.3 33.4 36.4 16.7 5.2West Asia 22.3 32.6 22.7 14.0 8.4South-East Asia 17.5 26.7 26.1 14.4 15.3Japan 14.0 26.3 29.6 16.8 13.3United States 26.3 18.4 26.5 17.1 11.7Canada 20.3 26.1 26.6 16.2 10.8Australia 20.1 30.8 24.3 14.2 10.6Rest of the world 20.0 27.6 26.5 15.4 10.5Total 18.3 28.4 27.1 15.9 10.3

Source: India Tourist Statistics 19893.7 Distribution of Tourists by Occupation

The largest percentage (29.3%) of tourists visiting India are workers in production. sales andservice sectors. Scientists and technicians constitute 19.3 per cent, entrepreneurs and proprietors 10.7per cent and government administrators 7.6 per cent. The percentage of students visiting India are about15.4 per cent and house wives 8.0 per cent. The distribution of tourists according to occupation andnationality during 1989 is given in table 3.12.

TABLE 3.12DISTRIBUTION OF TOURISTS ACCORDING TO NATIONALITY AND OCCUPATION

NationalityCountryRegionWorkers Scientists

techniciansStudents Entrepreneurs House

Proprietors wivesGovt.Administors

Others

9.14.85.14.12.87.2

12.16.56.96.95.8

13.9

9.111.710.310.212.5

1.55.713.1'5.96.56.34.5

12.314.211.010.25.33.710.9

10.911.810.114.56.5

23.624.825.632.430.754.030.223.818.832.329.728.2

20.426.928.825.236.33.513.523.025.018.323.19.0

16.610.010.49.46.219.914.412.323.317.413.619.1

8.7.18.:8.6.

10.13..10..8..8.7.18..

United KingdomFranceFederal Rep. of GermanyRest of West EuropeEast EuropeWest AsiaSouth-East AsiaJapanUnited StatesCanadaAustraliaRest of the world

10.7 8.0 7.6 9.7otal 29.3 19.3 15.4Source: India Tourist Statistics 1989

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3.8 Distribution of Tourists by IncomeAccording to the foreign tourist survey 1988-89, about 38.3 per cent of the foreign tourists visitingIndia were in the lower income bracket with an annual income of As. 200,000 and less. The middle income

group with an annual income of As. 200,000 to 400,000 constituted about 41.4 per cent. The remaining20.3 per cent were in the income group of over 400,000 rupees. It is obvious from the survey that a largepercentage of foreign tourists visiting India are budget tourists with low levels of income. The distributionof tourists by nationality and income is given in table 3.13.

TABLE 3.13PERCENTAGE DISTRIBUTION OF TOURISTS BY INCOME AND NATIONALITY

Country/Region ANNUAL INCOME (As.' 000)Less than 201 201-400 Above 400

38.636.534.534.629.240.436.936.935.035.439.649.0

40.840.845.147.644.338.840.139.348.642.639.231.3

22.720.417.826.520.823.023.816.422.021.219.4

United KingdomFranceFederal Rep. of GermanyRest of West EuropeEast EuropeWest AsiaSouth-East AsiaJapanUnited StatesCanadaAustraliaRest of the worldTotal 38.3 41.3 20.4

Source: Foreign Tourist Survey 1988-893.9 Repeat Visits

Of the tourists who visited India during 1988-89, about 41.8 per cent were repeat visitors. Nearly13.8 per cent of them had visited India more than 4 times earlier. The largest percentage of such touristswere from West Asia and South-East Asia. The distribution of tourists by nationality and number of visitsis given in table 3.14.

TABLE 3.14PERCENTAGE DISTRIBUTION OF TOURIST BY NATIONALITY AND

NUMBER OF VISITSCountry/Region Number of Visits

1 2 4 5+ Total63.262.862.365.062.753.849.053.965.471.070.047.1

13.718.017.310.919.313.619.025.716.313.48.323.2

4.26.07.95.83.54.07.05.15.53.811.47.3

5.14.61.53.83.34.27.92.83.22.02.57.2

13.8.11.14.11.24.17.12.9.9.7.15.

100.0100.0100.0100.0100,0100.0100,0100,0100.0100.0100.0100.0

United KingdomFranceFederal Rep. of GermanyRest of West EuropeEast EuropeWest AsiaSouth-East AsiaJapanUnited StatesCanadaAustraliaRest of the worldTotal 58.2 16.5 5.7 5.8 13.8 100.0

Source: Foreign Tourist Survey 1988-89

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3.10 Duration of Stay ,According to the survey, the average duration of stay of foreign tourists in India was 28.4 days. Anotable feature, however, is that about 30 per cent of the tourists stay in India for more than 120 days. The

largest percentage of these tourists are from the United Kingdom and rest of the world which includemostly Asian countries. This is probably because these tourists visit a large number of centres in thecountry. Over 53 per cent of Australian tourists spent 22 to 30 days and another 35 per cent stay for 31to 60 days in India. In the case of American and German tourists about 25 to 27 per cent stay in India for22 to 30 days and almost equal percentage stay for more than 120 days. The distribution of tourists bynationality and duration of stay is given in table 3.15.

TABLE 3.15PERCENTAGE DISTRIBUTION OF TOURISTS BY NATIONALITY AND

DURATION OF STAYCountry/Region Upto7 days 8 to14

days15 to20days

21 to30days

31 to60days

61 to120days

Above120days

4.51.15.12.21.34.20.28.53.71.92.40.3

8.59.310.57.31.217.70.68.69.012.54.33.5

10.511.514.318.116.418.516.417.09.819.93.510.4

20.426.627.220.533.521.531.718.825.624.253.417.7

10.224.114.320.629.920.636.818.422.817.535.112.9

0.47.83.03.14.03.35.52.53.52.00.05.4

45.519.625.628.213.714.28.826.225.622.01.343.8

United KingdomFranceFederal Rep. of GermanyRest of West EuropeEast EuropeWest AsiaSouth-East AsiaJapanUnited StatesCanadaAustraliaRest of the worldTotal 2.4 8.3 13.4 23.5 19.0 3.6 29.8

Source: Foreign Tourist Survey 1988.893.11 Evaluation of Tourist Facilities in India

One of the objectives of the foreign tourist survey 1988-89 was to evaluate the quality of varioustourism facilities and attractions in India. While the history and culture of India, friendliness of people,safety and service facilities in hotels received a high rating, the travel facilities in general received poorrating. The factors which received high (very good or good), average and poor rating along with thepercentage of tourists recording the same are given in table 3.16.

TABLE 3.16RATINGS OF TOURIST FACilITIES AND ATTRACTIONS

High Average PoorAirports (32.20) IntercityAir travel (31.70)IntercityBus travel (29.90)Intercity axi travel (25.20)IntercityRail travel (23.20)Entertainment (19.50)Local travel (18.70)Guide service (18.10)

History and Culture (74.80)Friendliness of people (64.80)Service/facilities in hotels (61.70)Safety (61.50)Climate (61.40)Hospitality in hotels (60.05)Tourist attractions (56.80)Communication (55.40)Tariff of hotels (52.90)Over all cost (46.30)Variety of food (41.40)Food in hotels (36.60)

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3.12 The Main Features and Some IssuesInternational tourism in India is characterised by moderate growth rates, high seasonality, longduration of stay, a high percentage of repeat visitors, increasing proportion of holiday sectors and low

income tourists. There is a declining trend in the case of United States and an increasing trend in the caseof United Kingdom with regard to the percentage share of touristsfr-om1hese countries. India has not beenable to penetrate into the holiday markets of West Asia, South-East Asia, Japan and United States. TheWest Asian tourists are generally repeat visitors with a strong business motivation. The visiting tourists aregenerally satisfied with most of the tourist facilities in India except transport services, entertainment andguide services. The issues that emerge from the analysis are (i) ineffectiveness of tourism promotion andmarketing efforts, (ii) infrastructural inadequacies and absence of an integrated approach in the tourismdevelopment programmes, (iii) lack of enterprise on the part of the travel industry to promote newgeneration tourists, and (iv) low percentage of high income tourists in the visitor arrivals.

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CHRPTER IVINTERNATIONAL TOURISM RECEIPTS

4.1 World Tourism ReceiptsTravel and tourism is the world's largest industry today in terms of its total turnover. According toa study carried out by Wharton Econometric Forecasting Associates for the World Travel and Tourism

Council, the gross output of travel and tourism industry amounted to $US 2,450 billion during 1989. Aboutone-twelfth of this turnover was on account of international tourists. While tourism receipts, in general,create wealth and employment in the tourist receiving regions, international tourist expenditure enters intothe balance of payment accounts of individual countries and is of major significance to them. The estimatedworld tourism receipts during 1990 were $US 249 billion.4.2 Estimation of Tourism Receipts in India

The estimates of tourism earnings in India are compiled by the Reserve Bank of India (RBI) as apart of balance of payment statistics. The ba$ic data used for the purpose are the returns furnished by the'authorized dealers' of foreign exchange. All foreign exchange transactions of Rs. 10,000 and above arecategorised as classified receipts and the authorized dealers provide information for each such transactionabout the nationality of the beneficiary, currency and purpose. However, in the case of transactions belowRs. 10,000, the figures are clubbed together and reported as unclassified receipts. These unclassifiedreceipts are apportioned according to purpose and country through a survey of unclassified receipts carriedout by the RBI every year. The official estimates of RBI are, however, generally available with a time lagof about two years. Quick estimates are, therefor worked out by the Department of Tourism on the basisof tourist arrivals and estimated average expenditure per tourist derived from foreign tourist surveys dulyadjusted for price changes.

4.3 Growth in Tourism ReceiptsOver the years, there has been a phenomenal increase in foreign exchange earnings from tourismin India. In about three decades from 1960-61 to 1990-91, tourism earnings went up from As. 0.15 billionto As. 24.44 billion, registering an annual rate of growth of about 18.5 per cent. The rate of growth in worldtourism receipts was only 12.7 per cent during the same period. However, the growth rates in successivedecades varied significantly and the growth in world tourism receipts was more in all of them except thedecade from 1970-71 to 1980-81. The comparative figures are given in table 4.1. It could be seen fromthe table that the growth rates in tourism earnings do not conform to rates of growth in tourist arrivals.

TABLE 4.1COMPARATIVE GROWTH RATES IN TOURISM RECEIPTS

81. No. Decade Average Annual Growth RateTourism Earnings

in India World TourismReceipts12.3.4.

1950-11960-11970-11980-1

7.99.0

41.47.7

12.610.019.19.3

Notes: (1)(2)(3)

Estimates of tourism earnings in India refer to the corresponding financial year.Growth rate in the case of India for the first decade is for a period of nine years from 1951 to 1960.Estimate of tourism earning for 1990 is provisional.

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Over the period from 1960 to 1990, the tourism earnings of India grew nearly 163 times ascompared to a growth of over 36 times in world tourism receipts during the same period. The comparativefiguresare given in table 4.2.

TABLE 4.2COMPARATIVE ESTIMATES OF TOURISM RECEIPTS IN INDIA AND THE WORLD

YearReceipts(Rs. billion) Index Receipts($US billion) Index

1960197019801981198219831984198519861987198819891990

100240

777370877533816790139860

1071312373136931637316293

6.8717.90102.37104.3198.6398.40

109.83116.16139.23170.46196.52209.42249.30

100261

14901518143614321599169120272481286030483629

P: Provisional

Though the earnings in rupee terms show an impressive growth over the years, it has remainedalmost stagnant during the last ten years in dollar terms. The maximum growth has been during the periodfrom 1970 to 1980. Growth in tourism receipts is expected to be a function of growth in tourist arrivals asper the following equation:(Growth in tourism receipts) = (Growth in tourist arrivals) x (Rise in average expenditure per tourist)

However, it has been noticed that the tourism receipt in dollar terms has declined even when therehas been an increase in tourist arrivals. The obvious conclusion is that the average expenditure per touristin dollar terms has declined substantially to negate even the increase in tourist arrivals. The possiblereasons for such a phenomenon are:

i)ii)iii)

high rate of devaluation of rupee in the recent past;rise in the proportion of budget tourists;leakage of money into black market due to the existence of a premium for foreign currency;and

iv) errors in estimation.It is evidently true that the devaluation of rupee against dollar has been at a faster rate than the

increase in tourism earnings in rupee terms as given in table 4.3. It is also possible that the shift in thecomposition of tourists towards holiday and charter tourists is adversely affecting the average yield pertourist.Money changing facilities were not easily available in India particularly in small cities and/or afterbanking hours. Therefore, the foreign tourists must have been tempted to encash their currency fromunauthorized sources leading to leakage of foreign exchange. With a view to minimise such leakages thehotels and restaurants holding restricted money changing licenses have been recently made eligible toprovide money changing facilities to tourists. Travel agents and tour operators can also provide moneychanging facility to a limited extent. Some other measures taken by the Government to increase foreignexchange earnings include fixation of dollar fares by Indian Airlines and hotels and de-regulation of hoteltariff.

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TABLE 4.3TOURISM EARNINGS IN RUPEE AND DOLLAR TERMS

Average"Exchangerate per $

Tourism Earnings (Million)" IndexRupees Index Dollarsear Index

1980-811981-821982-831983-841984-851985-861986-871987-881988-891989-901990-91

11,66310,63011,30012,25013,52214,79416,06618,56120,53824,560(P)24,440(P)

1009197

105116102138159176211210

1,4751,1851,1691,1851,1371,2091,2571,4311,4181,4751,362

10080798077828597961092

7.9088.9689.666

10.34011.88912.23512.77812.96614.48616.64917.943

100113122131150155162164183210227

.Source(P)

Economic Survey 1990-91Provisional

As a result of stagnation/decline in tourism earnings in dollar terms, the percentage share of Indiain the world tourism receipts has gone down to 0.55 per cent during 1990. The comparative figures aregiven in table 4.4.

TABLE 4.4SHARE OF INDIA IN THE WORLD TOURISM RECEIPTS

Year TourismEarnings(millionRupees)

AverageExchangeRate perDollar

TourismEarnings(million $)

WorldTourismReceipts(million $)

PercentageShareofIndia

1960197019801981198219831984198519861987198819891990

153364

11,66310,63011,30012,25013,52214,79416,06618,56120,53824,56024,440

4.7607.5007.9088.9689.66610.340

11.88912.23512.77812.96614.48616.64917.943

32.148.5

1,474.81,185.31,169.01,184.71,137.41,209.21,257.31,431.51,417.81,475.21,362.1

6,86717,900

102,372104,30998,63498,395

109,832116,158139,234170,456196,521209,416249,300

0.470.271.441.141.181.201.041.040.900.840.720.700.55

Sources: (1) India Tourist Statistics(2) Economic Survey 1990-91

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In dollar terms, the total invisible earnings and tourism receipts show almost similar pattern. Bothincreased substantially during the period 1970-71 to 1980-81, and stagnated during 1980's. However, inthe case of commodity exports there has been a substantial increase during the previous decade. Thismust have been perhaps due to the fact that the pricing mechanism in the case of exports would have takencare of the impact of devaluation of rupee to a greater extent than in the case of invisible earnings. Thecomparative figures are given in table 4,7.

TABLE 4.7COMPARISON OF TOURISM RECEIPTS WITH TOTAL MERCHANDISE EXPORTS

AND INVISIBLE EARNINGS IN DOLLAR TERMS($US million)

Year Export Earnings Invisible Earnings Tourism Earnings1960-611970-711980-811981-821982-831983-841984-851985-861986-871987-881988-891989-901990-91

1,324.61,872.78,316.38,658.89,452.89,834.110,059.49,462.710,420.112,645.914,257.116,955.2

18,128.1

546.0661.57,448.65,921.45,847.06,220.66,933.46,436.76,475.47,156.17,544.97,498.2N.A.

32.148.51,474.81,185.31,169.01,184.71,137.41,209.21,257.31,431.51,417.81,475.01,362.0

Source: Economic Survey 1990-914.6 Tourism Receipts as Compared to Major Items of Export

The major items of export of the country at present are (i) Gems and jewellery, (ii) Readymadegarments, and (iii) Leather and leather products. Export earnings from (i) agricultural products, (ii)machinery, transport equipment and metal products, and (iii) chemicals and allied products are also high.However, these are not considered for comparison as each one of them constitute several products. Thecomparative figures are given in table 4.8. It could be seen that tourism earnings were next only to theexport earnings from gem and jewellery and readymade garments till 1989-90, though it became lower thanthe export value of leather and leather products also during 1990-91.

TABLE 4.8TOURISM RECEIPTS AND MAJOR ITEMS OF EXPORT

(As. million)Year Gem &

Jewellery ReadymadeGarments Leather &LeatherProducts

TourismReceipts

1960-61 10 10 280 1531970-71 448 294 802 3641980-81 6,184 5,503 3,897 11,6631981-82 8,115 6,412 4,248 10,6301982.83 10,148 5,908 4,146 11,3001983-84 12,941 7,256 4,925 12,2501984-85 12,371 9,533 7,241 13,5221985-86 15,207 10,670 7,699 14,7941986.87 20,740 13,310 9,220 16,0661987-88 26,130 18,180 12,510 18,5611988-89 43,920 20,991 15,223 20,5381989-90(P) 52,955 32,242 19,509 24,5601990-91(P) 52,100 40,424 25,539 24,440.

Source: Economic Survey 1987-88 and 1990-91(P): Provisional

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An important factor to be noted is that gems and jewellery exports depend heavily on the importsof pearls and precious stones. During the year 1990-91, these imports amounted to As. 37,323 millionagainst a total export value of As. 52,100. Thus the net retention ratio in the case of gems and jewellerywas only about 28 per cent. In the case of ready made garments, the value of imports of different varietiesof fibres during 1989-90 was about As. 2,610 million. These imports, however, related to the total exportof textiles valued at As. 67,975 million. The leakages due to import in the case of readymade garments isthus about 4 per cent, giving a net retention ratio of about 96 per cent. "A Comparative Study of Incentivesfor Invisible Earnings through Tourism" conducted by the Indian Institute of Foreign Trade in the year 1985,estimated that the foreign exchange outflow on account of tourism would be about 7 per cent. In the caseof leather and leather products also the import requirement of dyeing, tanning and colouring materialsconstitute about 7.5 per cent of the value of exports. Thus, in terms of net foreign exchange earnings,tourism used to be on the top as compared to various export items. However, it has been pulled down tothe second position by readymade garments during 1988-89 and to third position by leather and leatherproducts during 1990-91.

4.7 Expenditure Pattern of TouristsAccording to the 'Foreign Tourist Survey 1988-89', the average expenditure of non-package

tourists excluding the nationals of Pakistan and Bangladesh was As. 17,770 during that year. The foreignexchange available to Pakistan nationals to visit India is $US 45 and the same in the case of Bangladeshnationals is $US180 per tourist.

The average expenditure per tourist was the highest in the case of Australia. followed by theFederal Republic of Germany, France, Japan and United States and was the least in the case of UnitedKingdom. The average duration of stay was the largest in the case of Asian tourists including South-Ea~.tAsia and East European tourists except Japanese nationals. The comparative figures are given in table4.9.

TABLE 4.9ESTIMATED AVERAGE DURATION OF STAY AND PER CAPITA

EXPENDITURE OF FOREIGN TOURISTS (1988-1989)(Non-package tourists)

TotalExpenditureper Tourist(in As.)

Expenditureper Day perTourist(in As.)

Nationality(Country/Region) Av(\rageDuration ofStay(in days)

25.7731.5324.3232.1438.9321.1736.2120.7328.9828.9227.9843.92

13,64120,15921,07518,90414,31817,68712,38119,02719,00119,31422,04219,932

529639866588367835341917655667787453

United KingdomFranceFederal Rep. of GermanyRest Of West EuropeEastern EuropeWest AsiaSouth-East AsiaJapanUnited StatesCanadaAustraliaRest of the worldAll Nationalities 17,770 5711.11

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The findings of the 1988-89 survey are at variance with the results of 1982-83 survey. Accordingto the earlier survey, the West Asian tourists were the highest spenders in India followed by the visitorsfrom United States of America. However, in terms of average expenditure per day per tourist, Japanesenationals took second position after West Asia. These changes are more likely to be because of the shiftsin the composition of tourists from these countries. The comparative figures as per 1982-83 survey aregiven in table 4.10. TABLE 4.10

ESTIMATED AVERAGE DURATION OF STAY AND PER CAPITAEXPENDITURE OF FOREIGN TOURISTS (1982-1983)

(Non-package tourists)TotalExpenditureper Tourist(in As.)

Expenditureper Day perTourist(in As.)

Nationality(Country/Region)AverageDuration ofStay(in days)

26.8627.7225.3831.2140.1023.5630.2115.3223.7526.3528.7635.62

8,1206,7417,6937,0018,290

12,0823,7197,5509,2078,2728,1007,869

302243303224207r;1~

388314282221

United KingdomFranceFederal Rep. of GennanyRest Of West EuropeEastern EuropeWest AsiaSouth-East AsiaJapanUnited StatesCanadaAustraliaRest of the world

27.55 8,008 291The expenditure pattern of international tourists on various items of consumption also appears to

have changed to some extent froni 1982-83 to 1988-89. While the expenditure on food and accommoda-tion has come down from about 54 per cent in 1982-83 to about 49 per cent in 1988-89,the expenditureon entertainment has gone up from 2.6 per cent to 9.3 per cent. The expenditure on shopping also showedsubstantial reduction from about 25 per cent in 1982-83 to 15.6 per cent in 1988-89. These differer.cesmay be due to the structural changes that have taken place in the tourism industry between 1982 and 89.There has been a definite improvement in the tourist recreational facilities in the country during the period.This must have perhaps resulted in a larger share of expenditure on entertainment by the foreign tourists.Simultaneouthe percentage of business tourists visiting the country has come down resulting in adecline in the expenditure on shopping. The pattern of expenditure of tourists during 1988-89 and 1982-83 by nationality are given in tables 4.11 and 4.12.

TABLE 4.11EXPENDITURE PATTERN OF TOURISTS BY NATIONALITY -1988-1989

Percentage ExpenditureNationality Accommodation Food Entertainment Shopping Internal Others(Country/Region) Drinks TravelUnited Kingdom 33.81 17.70 8.70 15.26 20.02 4.51France 32.44 21.06 10.03 13.92 18.64 3.91Federal Rep. of Germany 30.35 16.67 10.60 14.86 22.84 4.68Rest Of West Europe 30.94 19.81 10.56 13.54 20.63 4.52Eastern Europe 29.87 20.39 9.91 18.27 15.59 5.97West Asia 33.42 17.07 7.73 15.72 20.89 5.17South-East Asia 32.34 15.21 7.02 18.28 18.81 8.34Japan 25.24 20.30 9.61 18.13 13.79 12.93United States 28.63 19.80 10.53 15.59 18.09 7.36Canada 33.91 16.64 7.97 17.26 17.89 6.33Australia 33.02 15.35 9.98 13.58 19.60 8.47Rest of the world 29.51 18.13 8.54 15.46 19.40 8.96All Nationalities 30.71 18.53 9.29 15.63 19.06 6.78

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TABLE 4.12EXPENDITURE PATTERN OF TOURISTS BY NATIONALITY-1982-1983

Nationality(Country/Region)

35.33.34.34.35.32.27.43.33.30.27.30.

20.8721.4621.2222.8323.4419.7716.1921.0518.2820.5619.1321.85

2.881.231.261.572.414.872.131.691.491.272.493.41

22.23.25.22.25.23.29.19.29.27.30.27.

15.4717.5613.9215.7712.129.08

14.8513.1814.0215.7015.4113.06

3.153.142.892.961.459.54

10.251.384.075.194.303.95

United KingdomFranceFederal Rep. of GemlanyRest Of West EuropeEastern EuropeWest AsiaSouth East AsiaJapanUnited StatesCanadaAustraliaRest of the worldAll Nationalities 33.45 20.50 2.61 13.63 4.97

4.8 Main Findings and Some IssuesTourism has already become a major source of foreign exchange earnings for the country and its

capacity to bridge the gap in the balance of payments account has been well recognized. The rate of growthin tourism earnings has been the highest (41.4 per cent) during the decade 1970-80 and it then reducedto 7.7 per cent in the last decade. Tourism receipts in dollar terms, however, remained stagnant over thelast ten years, though in rupee terms it increased by about 110 per cent. The high rate of devaluation ofrupee has been one of the reasons for such a stagnation.

There have been structural changes in the tourist expenditure pattern and demand characteristicsduring the last few years. These changes also would have contributed to the low rate of receipts per touristin dollar terms. The issue before the Government is, therefore, the choice of a strategy and/or action planfor accelerating the growth of tourism earnings in dollar terms. The options available are (i) intensivepromotion in the tourist generating markets to increase the volume of tourist traffic to India, (ii) price outthe budget tourists and increase the yield per tourist, (iii) encourage the tourists to spend more in India byproviding better facilities including entertainment and recreational avenues, (iv) concentrate marketingefforts on selected high spending tourist regions, and (v) prevent the leakage of tourism earnings into blackmarket. Each of these options have to be carefully considered while formulating a strategy and futuredevelopment plans as the choice of a wrong option could lead to disastrous results. Obviously, the existinginfrastructural support and investment priorities would become the key elements in the choice of thestrategy. The structural adjustments initiated by the present Government in the ~ndian economy and theprevailing foreign exchange crisis are also important factors requiring attention. In the given scenario, thebest choice, perhaps, would be an optimum combination of all the available options. The diversificationprocess initiated by the Government during the Visit India Year could become successful if it is supportedby proper upgradation of tourist facilities, better quality control and effective marketing in selectedcountries.

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CHAPTER V

DOMESTIC TOURISM IN INDIAEvolution of Domestic TourismTravel for pilgrimage and learning has been an integral part of Indian culture, ever since thebeginning of its civilization. Several centres of learning and religious worship thus developed allover thecountry since ancient times. This gave further impetus to the mass movement of people from one placeto another. Development of traditional industries and trade created another stream of travellers. Several

trading routes were established and traders started frequenting the centres of trade from distant places.The ancient rulers gave due recognition to these travellers and created many wayside facilities like inns,sarais,

dharamshalas and caravans for their benefit. These formed the tourism infrastructure of India inthose days. Thus, India has been experiencing massive movement of domestic tourists for severalcenturies.

A few centuries ago the Moghul rulers introduced pleasure tourism by building luxurious palacesand enchanting gardens in places of natural scenic attraction. It was, however, during the period of Britishrule in India, that domestic tourism received a new direction and meaning. The establishment of railwaysand export/import houses at port towns introduced qualitative and quantitative changes in the Indianbusiness tourism. In addition, the construction of circuit houses, dak bungalows and forest lodgesprovided the infrastructure for leisure and wild life tourism. Several hill stations were also developed duringthe period which became the core of Indian leisure tourism. The emergence of a large 'urban middle class'coupled with better transport and communication facilities has created a new class of holiday and leisuretourists in the contemporary India.

5.2 Dimensions of Domestic TourismAlthough. the importance of domestic tourism has been recognized by the country, reliablestatistical information on its volume and growth is lacking. In fact, a precise definition of dom~stic tourist

was attempted only during 1977. According to the definition, a domestic tourist is "a p'3rson who travelswithin the country to a place other than his usual place of residence and stays at hotels or in dharamshalaslsarais/musa

etc., for a duration of not less than 24 hours or one night andfor not more than six months at a time for any of the purposes of (a) Pleasure, (b) Pilgrimage, religious andsocial functions, (c) Business, conferences and meetings, and (d) Study and health.

A pilot study on domestic tourism was commissioned by the Government in 1981 to estimate thevolume of domestic tourist movements in the country. The study covered 22 centres selected purposivelyto include the entire spectrum of tourists. The selected centres included 3 metropolitan cities, 3 businesscentres,

7 hill stations and beach resorts, 3 historical cities and 6 pilgrim places. Based on the results ofthissurvey, the number of domestic tourists during 1981 was estimated to be 14 million.

In a report titled "Indian Tourism: Performance and Potential 1981-91", the Indian Institute of PublicOpinion (IIPO) conjectured that the volume of domestic tourist traffic in India during 1986 would be in therange of 134 to 164 million including about 120-150 million pilgrim tourists.

The astronomical dimensions of domestic travel in India can also be seen from air and rail transportstatistics. The Indian Railways carry about ten million people per day and the Indian Airlines carry aboutten million passengers per year. The passenger statistics of Indian Airlines and Indian Railways since 1985are given in table 5.1. These figures are indicative of the gigantic nature of Indian domestic tourismalthough most of them may not be tourist as per definition.

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TABLE 5.1NUMBER OF PASSENGERS CARRIED BY INDIAN AIRLINES

AND RAILWAYS(Million Nos.)

Year Domestic Foreign Total1985-861986-871987-881988-891989-90

9.649.359.919.559.41

0.490.520.530.560.44

10.139.87

10.4410.119.85

3,4333,5803,7923,5003,653

As per the figures compiled by the Department of Tourism based on the reports received from theState Governments, the total number of domestic tourist visits in the accommodation establishmentsduring 1990 were about 62.38 million. Though these figures suffer from the problems of comparability andcoverage,

there has been a steady growth of about 21.4 per cent per annum in the domestic tourist visitsduring the period from 1987-1990. These figures are given in table 5.2.

TABLE 5.2NUMBER OF DOMESTIC TOURIST VISITS

Year Number1987198819891990

34,816,64938,337,47450,588,85062,319,113

5.3 The Structure of Domestic TourismAccording to the pilot study on domestic tourism, the motivations of travel for the domestic touristswere:-

(56,(21,(13,

(2,(2,(2,(1,

(i) leisure(ii) Business(iii) Pilgrimage(iv) Education(v) Health(vi) Social functions(vii) Others

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,8,3,5

,6,026

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Demographically, 67.2 per cent of the tourists were males and 32.8 per cent were females. While16.3 per cent of the tourists were aged below 12 years, 38.1 per cent were in the age group of 13 to 29 yearsand 40.3 per cent were aged between 30 and 55 years. The remaining 5.3 per cent were above the ageof 55. A large proportion of about 63.8 per cent travelled with family while 17.5 per cent travelled alone.The remaining 18.7 per cent travelled with friends. The occupational distribution of the3e tourists was asgiven below:

(i) Business(ii) Profession(iii) Service(iv) Agriculture(v) Students(vi) Others

The major tourist generating regions in the country were the industrially developed states ofMaharashtra, West Bengal, Uttar Pradesh and Gujarat besides the Union Territory of Delhi. They sharedamong themselves about 50 per cent of the total domestic tourists. The four metropolitan cities of Bombay,Calcutta, Delhi and Madras alone generated about 25 per cent of the tourists. It clearly indicates that thegrowth of tourism essentially depends upon the industrial and business prosperity.

About one-third of the domestic tourists belonged to the middle income group. The averagehousehold income of these tourists was in the range of Rs. 10,001 to Rs. 20,000. The lower income groupin the range of Rs. 6,001 to Rs. 10,000 constituted about 20.4 per cent. These two categories takentogether thus accounted for about 53 per cent of the total tourists. The pattern was almost the same in alltypes of tourist centres except that the higher income groups mostly visited tourist resorts, business centresand metropolitan cities. It clearly indicates that domestic tourism in India is a mass movement and not anelite activity. The distribution of tourists according to their annual household income is given in table 5.3.

TABLE 5.3DISTRIBUTION OF TOURISTS ACCORDING TO ANNUALHOUSEHOLD INCOME

AnnualHHD IncomeRange (Rs.)

Percentage of touristsMetro-cities BusinessCeritres HillStations

& BeachResorts

HistoricalSites PilgrimCentres All Places

1.2.3.4.5.6.elow 6,0006,001 to 10,000

10,001 to 20,00020,001 to 30,00030,000 to 50,000Above 50,000

7.516.127.823.117.08.5

2.125.330.615.816.89.4

3.712.525.823.819.614.6

2.423.152.119.02.80.6

6.531.332.320.6

5.93.4

4.920.432.621.512.87.8

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The average length of stay of domestic tourists in their places of visit was estimated from the pilotstudy as 5.4 days. A similar survey of domestic tourists was conducted in 55 centres during 1980-81 asa part of the study on "Employment Potential of Tourism in India". By combining the results of both studies,the average length of stay of domestic tourists was estimated as 5.6 days. Both the surveys revealed thatthe domestic tourists tended to stay more at metropolitan cities than at historical places and pilgrim centres.It was a clear indication that the duration of stay of domestic tourists was influenced by the availability oftourist facilities. The estimates of length of stay in different types of centres as revealed by the Pilot Studyand the pooled data are given in table 5.4.

TABLE 5.4ESTIMATED AVERAGE LENGTH OF STAY OF DOMESTIC TOURISTS

Average Length of StayType of CentreAs per PilotStudy As per PooledData

7.64.36.02.84.4

7.94.56.22.94.5

2.3.4.5.

Metropolitan citiesBusiness centresHill stations and beach resortsHistorical sitesPilgrim centresAll Centres 5.6.4

5.4 The Expenditure Pattern of Domestic TouristsAccording to the pilot study, the average per capita expenditure of domestic tourists per day was

As. 76.60 for all the centres taken together. However, there were large variations from centre to centre.lngeneral, the average expenditure of a tourist per day was high at the metropolitan cities (As. 116.0) andwas extremely low at historical sites (As. 33.50) and pilgrim centres (As. 24.90). These estimates weresignificantly lower than those obtained by the survey on "Employment Potential of Tourism in India". Asper this survey, the average expenditure per tourist per day was As. 126 including intercity travel exlJensesof As. 46.52. The pilot study on domestic tourism did not include the intercity travel expenses. Further,there were differences in the methods of data collection followed in both the surveys. Whi