Draft Report of the High Level Group on Services Sector

3.5 Integrated Infrastructure Development of Tourist Sites

Schemes for the development of infrastructure at tourist sites have been undertaken under the Five year Plans and some good results have been obtained. But the funds have been spread thinly and the schemes have not been integrated with plans for the beautification of the urban surroundings of the sites. Several cities with tourist interest have been included in the 63 cities identified as mission cities under the Jawaharlal Nehru Urban Renewal Mission (JNNURM), but the priority in the Mission is for schemes for water supply, sewerage, drainage and solid waste management. In order to improve the competitiveness of heritage tourism in India the Group recommends that funds should be earmarked from the provisions for JNNURM for the beautification of the urban surroundings of the heritage sites in these cities.
The Group’s attention was drawn to the enactment of the Kerala Tourism (Conservation and Preservation of Areas) Act, 2005, which provides for the declaration by the State Government of any area, which has or is likely to have importance from the point of view of tourism, as ‘Special Tourism Zone’ for the conservation, preservation and integrated development of such an area. The Act envisages the constitution of a Tourism Conservation and Preservation Committee, with the main function to prepare sustainable tourism development plans including guidelines to regulate developmental activities in the area and powers to give directions to the local authority for the implementation of such plans and guidelines. The Group was of the view that other State Governments with tourism activity should consider enacting a similar law so that planned development of tourist areas at the initiative of State Tourism Departments could be undertaken with the participation of local authorities.
3.6 Beach Tourism

Beaches are one of the most important destinations for the affluent tourists from the Northern hemisphere. India has a coastline of 6000 kms but beach tourism is not well developed, Goa being the only international beach destination in the country. One factor, which affects the competitiveness of beach tourism in India, is the stringent coastal regulations zone requirements (CRZ), under which a hotel cannot be built within 200 metres of the coast. Such a restriction does not exist in any successful beach destination in the world. In 1992 the Ministry of Environment and Forests (MOEF) had issued orders for relaxation of the requirement so as to enable hotels to be built between 200 and 100 metres of the beach. The Hon’ble Supreme Court also issued a direction asking the Government to identify the stretches on the coastline on which beaches could be developed and report back to them. Although 15 years have elapsed this work has not been completed, as the MOEF has got involved in the task of comprehensive revision of the CRZ Regulations.

To improve India’s competitiveness in beach tourism the Group recommends that a decision be taken quickly on hotel construction on beaches according to the prevailing practice in other countries. The sensitive areas could be clearly defined and one or two long stretches of the coastline, particularly on the west coast, could be opened up for development of tourism.

3.7 Conference Tourism

Meetings, incentives, conferences and exhibitions (MICE) is another area of tourism in which India lacks in competitiveness because of lack of world class conference centre apart from Delhi’s Vigyan Bhawan, which is normally reserved for Government conferences. It is estimated that about 500 large annual conferences are held in India by domestic organisations alone. This has the potential to give India a competitive edge, as the conference centre would have assured business for a large number of days in the year. But what needs to be done is to facilitate the establishment of four or five large convention centres in the country. So far a large facility has been built in Hyderabad and another conference centre is proposed to be taken up in Dwarka in Delhi. In order to have more convention centres it would be necessary for the States to facilitate the allocation of land and for the Central Government to give such centres infrastructure status under Section 80- 1A of the Income Tax Act, so that they can have tax benefits.

3.8 Entertainment for tourists

Whether it is heritage tourism or beach tourism, the foreign tourists as well as domestic leisure travellers want some form of entertainment, particularly in the evening. For this purpose consideration needs to be given to allowing casinos to operate in certain locations. Though the subject has remained a taboo in the country it has to be borne in mind that casinos will not only increase the competitiveness of tourism destinations in the country but also have the potential to generate substantial revenues for the State Governments, just as lotteries have done for some of them. Casinos are the mainstay of the economies of tourist destinations such as Las Vegas, Monte Carlo and Macau. Singapore too has allowed the establishment of two casinos in its territory.
For heritage sites sound and light shows are a favourite form of entertainment. Such shows are being held by the State Tourism Departments in some tourist destinations but they are of poor quality. It is necessary to hold such shows at a larger number of major historical sites and substantially improve their quality.
3.9 Tourist Clusters

In the affluent countries there is flow of tourists out of the cities not only during holidays and almost every weekend, weather permitting. The weekend tourists, particularly those with children, normally go out short distances to resorts and tourist destinations, such as mountains, lakes and beaches. But they also go to man made attractions and clusters of attractions such as Santosa Island Resort in Singapore.

The rapid increase in disposable income in the upper middle class in India presents a big opportunity for development of tourism in the country. The Group recommends the creation of tourism clusters of areas between 100 and 500 acres within a distance of 150 kms for the cities for the setting up of a cluster of facilities and attractions for tourism. They may have hotels, restaurants, spas, theme parks like Appu Ghar in Delhi and Essel World in Mumbai, and attractions such as skating rinks, lakes with boating and sailing facilities, golf courses, tennis courts, and indoor games. Although the clientele of tourist clusters will primarily be domestic, they will also serve to increase the attractiveness of traditional tourist destinations for international tourists. The entire development, including the acquisition of land, will have to be undertaken by the private sector, but as an incentive they will need to be given infrastructure status under Section 80- 1A of the Income Tax Act.