According to details provided by the government in Parliament, the tourism economy shrunk by nearly 43% in the first quarter of 2020-21. It has resulted in the loss of an estimated 14.5 million jobs. As the COVID-19 pandemic and subsequent lockdown decimated the sector, which directly employed 34.8 million people the year before.
In the second and third quarters of 2020-21, the situation improved slightly.
“A study was conducted by National Council of Applied Economic Research (NCAER). The study shows the overall economic slowdown during 2020-21, tourism economy or tourism direct gross value added (TDGVA) saw a fall of 42.8 percent in Q1; 15.5 percent in Q2; and 1.1 percent in Q3,” Tourism Minister G Kishan Reddy said in a written reply to a question in Rajya Sabha on Tuesday.
He further stated that as a result of a significant drop in tourist arrivals and hence tourism expenditure during the pandemic. TDGVA is expected to drop by as high as 93.3 percent in the first quarter of 2020-21 compared to the same quarter the previous year.
The Indian Association of Tour Operators (IATO) spoke with Union Finance Minister Nirmala Sitharaman in her office on Friday. They urged her to boost the SEIS duty credit scrips ratio to 10%.
The IATO delegation that met with the Finance Minister was led by President Rajiv Mehra and immediate past President Pronab Sarkar.
Another topic discussed was the imposition of tax collection at source (TCS) on the sale of overseas tour packages. It was requested that TCS not be applied to non-resident foreign citizens/tourists/foreign tour operators located outside India. The ones who purchase tour packages through Indian tour operators for destinations outside India are specified clearly.
