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Kerala records a loss of 33 ,683 crores in tourism and allied industries post Covid 19 backlash

  • Abhish K. Bose,Kottayam

An apparent decrease in the inflow of both domestic and foreign tourists to the state was conspicuous in the statistics of the Kerala government and according to the estimates a loss of thirty three thousand six hundred and eighty three crore was suffered in the tourism and allied sectors in the state in 2020 in comparison with the 2019 statistics.

According to the estimates of the state government the total earnings in the tourism and allied sectors in the state for 2020 is 11, 335.96 crore rupees compared to the 45, 019 crore rupees in 2019.   The statistics point towards   a loss of 33, 683.73 rupees compared to 2019. The statistics was provided by the  Research wing of the state government.

In 2020 beginning there was a heavy inflow of the domestic tourists to the state and the domestic tourist inflow recorded a 13 percent increase in the month of January compared to that of 2019 January.  However, that increase underwent a substantial reduction in the month of February which recorded a drastic reduction to 3. 62 percent. This was most probably due to the scourge of Covid 19 struck by the middle of February and it further recorded a dismal -55.9percent in the month of March.  By the month of April it recorded a severe negative downside to -99.79 which is an unprecedented downfall.  By the month of May it was -99.59 and by June it reached -97. 82 percentage. In July it was – 97.18, August -95.37, September -91.39, October -86.8, November 80.09, and December -75.34.  In 2020 as a whole the downside caused as low as -72. 86 though it recorded a slight improvement in the last months.

The inflow of foreign tourists to the state in the month of 2020 January recorded an 8.6 percent increase in the month of January. However, in the succeeding months owing to pandemic inflicted scenario there was a receding tendency in the tourist inflow resulting in almost s state of paralysis. Beginning in the month of February  with a -15. 2 it went for downward spiral by -70. 8 in March, -99.2  April, -99.9, May, -99.9 in June, -99.8 in July, -99.5 August, -99.35 in September, -98.89 in October, -98.21 in November, and -98.36 in December. In 2020 the total foreign tourist inflow represents a massive decrease of -71.36 percent compared to 2019.

Though the state anticipated the continuation of the growth rate in 2020 the Covid 19 outbreak reported in China by 2020 January, and the World Health Organisation (WHO) had declared  Covid 19 as a Pandemic on March 11th which barred travel across the world spoiled the tourists inflow to Kerala. The above statistics are substantiating the downside.

The tourism industry of the state was passing through a crisis as a number of institutions in the hospitality industry have shut down due to the impact of the Covid 19 pandemic forcing them to ask their employees to go for leave and freezing their operations till the scenario has improved.

The tourism industry in the state was going through a stalemate after the Nipah virus outbreak and the deluge of 2018 which had affected the sector. The Covid 19 struck the tourism prospects of the state when in the preceding years there was growth in the inflow of tourists.  The inflow of the tourists had substantially increased in 2019. That is an increase of 17.2 percent regarding the inflow of the tourists in 2019 compared to that of 2018.  The growth rates of the foreign and domestic tourists have 8.5 percent and 17.8 percent respectively.    George Scaria, the Managing Director of the Kerala Vouages private limited, a tour operating company said the crisis is severe and he blamed the government for not resuscitating the industry.  “Even banks are not giving the loans guaranteed by the central government and we have been denied a loan.  The banks have blacklisted the hospitality industry and are not providing any loans”, he added.   He said a bank had denied him the loan under the central government promoted Guaranteed Emergency Credit Line( GECL) to help the small businesses in the MSME sector so as to overcome the Covid 19 by maintaining that the hospitality industry is in the negative list.

In a bid to lift the tourism sector the Planning Board  in its recommendations last year said that a consortium of banks and other financial institutions should be constituted so as to make the availability of the shortage of money.  The Planning Board recommends the state government to demand the central government for constituting a fund for not sacking the laborers in the tourism and hospitality sector.  The Planning Board demands that there should be stipulations to the line that those who should be the beneficiaries should not terminate the employees.    It also demanded the central government to give a relaxation for the interests rates taken by the small scale organisations.

Efforts should be made to rejuvenate the sector after the time of the travel restrictions are over as part of the strategy of the middle level period, the state Planning board says.  Another recommendation of the Planning Board is that the government should start special projects so as to help develop the markets of tour operators,  hotels, and resorts.  The recommendations also includes the postponement of the building taxes that was to be given by the local self governments by the first half of the 2020 – 21 for six months, and the reduction in road tax  for the transport operators approved by the state government for six months.  The electricity tarrifs of the Kerala State Electricity Board ( KSEB) should be postponed for six months.  The Planning Board estimates that if the total revenue of the tourism sector is 45,000 crores then the sector may suffer a loss of 20,000 crores as a result of the current stalemate.

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