IATO urges govt to set up tourism board; seeks ₹1,000 cr budget allocation

Business Standard

5 days ago

The Indian Association of Tour Operators (IATO), a key body representing domestic tour operators, said on Monday that it has urged Prime Minister Narendra Modi to establish an India Tourism Board, along with a budgetary allocation of ₹1,000 crore under the Incredible India Campaign, to attract more foreign tourists.
According to IATO, India is still not seeing the same number of foreign tourist arrivals (FTAs) as it did before the Covid-19 pandemic in 2019.
"While the importance of inbound tourism as a precious foreign exchange earner and soft diplomacy tool cannot be over-emphasised, India as a destination with such raw and natural beauty is performing way below its potential," the association noted.
Immediate action needed to boost inbound tourism
IATO said that the upcoming tourist season is only a few months away, making it the right time to introduce such measures.
"To step up, IATO has written to the PM, where it has urged immediate budgetary allocation of ₹1,000 crore under Incredible India Campaign and formation of India Tourism Board under the PM's leadership with the specific objective of increasing FTAs," the statement added.
IATO President Ravi Gosain highlighted that unlike global trade, which is currently affected by tariff wars and geopolitical issues, tourism exports are free from such challenges.
"Unlike goods, India's tourism export (i.e. foreign tourists spending in India), which is non-tariff based, brings direct foreign exchange earnings into the country. This positions inbound tourism as a stable, sustainable, and immediate contributor to India's current account with valuable foreign exchange, and employment generation and balances forex trade deficit. Yet, regretfully the country is lagging in its effort to attract foreign tourists," he stated.
To support the growth of foreign tourism, IATO has also recommended easier visa processes, which includes expanding the e-visa facility, faster approvals for group tourist visas and considering visa fee waivers for selected countries.
"Further we need to incentivise international airlines and air charters to improve air connectivity to key tourism circuits, especially in tier-2 and tier-3 destinations," Gosain said.
India's tourism industry: Outlook
According to India Brand Equity Foundation (IBEF), India's tourism and hospitality sector is expected to yield revenue exceeding ₹5,12,356 crore ($59 billion) by 2028. Additionally, the number of Foreign Tourist Arrivals (FTAs) is projected to reach 30.5 million by that year.
India's Union Budget 2025-26 has allocated ₹2,541.06 crore ($291.07 million) to boost its tourism sector, focusing on upgrading infrastructure, developing skills, and making travel easier. The key initiatives include developing 50 major tourist destinations, providing MUDRA loans for homestays, improving connectivity, and expanding e-visa services.
Travel and tourism are among the largest industries in India, contributing approximately $ 199.6 billion to the nation's gross domestic product.
According to India's Tourism Minister, the country's tourism industry is projected to grow at a Compound Annual Growth Rate (CAGR) of 20% over the next few decades, fuelled by the expanding middle-income group and rising disposable incomes.
India's geographical diversity and rich cultural variety offer unique experiences, making it one of the top countries in terms of international tourism expenditure.