The tourism growth story

India's growth story is real and here to stay says Homi Aibara, partner, Mahajan & Aibara. By Neeti Mehra

Homi Aibara Partner, Mahajan & Aibara

India's blistering growth is testament to its progressive policies. The economic spurt has had a beneficial effect on tourism too. Says Homi Aibara, partner, Mahajan & Aibara, " The growth drivers that have given a boost to tourism are economic growth, along with an increase in air seat capacity and IT and real estate development."

But is India's growth story a mere hype or reality? Aibara avers, "It is reality. The hype is created by many overly ambitious premature announcements of hotel projects."

He says that even though there is a huge need for additional room supply, there is a bunching effect in several locations in the country, with development concentrated in certain areas.

On the flip side to growth are perennial bottlenecks. Apart from infrastructure shortcomings, tourism is impacted by a cumbersome visa process. To solve the former, private-public partnerships (PPP) are being explored, and he feels that PPP will have a bigger impact if land for development of tourism infrastructure is provided by the government. "We have woken up late," Aibara points out of what's brewing in South-East Asia, "China's hotel industry has seen significantly greater development than we have seen in India. China, Thailand, Malaysia, and even Indonesia are ahead of the curve compared with India."

About Mahajan & Aibara

Mahajan & Aibara was established in 1979 and currently employs approximately 100 professionals from varied disciplines. The firm is accredited by the Inter-Institutional Committee of the Financial Institutions as Industrial Consultants and its partners are members of the Institute of Chartered Accountants as well as the Institute of Management Consultants of India. The company provides Management Consultancy Services in hospitality, leisure , travel, tourism and retail practice. Mahajan & Aibara's offices are located in South Mumbai and has associated firms in Chennai, Delhi and Pune.

Aibara believes

The leading hotel development is the business hotels mushrooming in the IT/ITES sector. "Bangalore, Pune , Chennai, Kolkata and Gurgaon have the greatest development potential. However, these locations now have substantial room supply in the pipeline," he adds. While most locations will show growth in RevPars and occupancies for the next year, there might be a dip in Bangalore and Pune with the new supply he feels.

Speaking on stimulating leisure tourism in the country, Aibara believes a difference can be made by introducing measures such as visa on arrival, improved infrastructure, an increase in room supply in resort locations, apart from other steps. " Casino licenses, more practical CRZ/ CZM regulations, opening of new areas with airports in areas such as Hampi, Badami, Sindhudurg, etc will give an impetus to leisure tourism in the country,"he emphasises.

According to him, going wired is the way ahead. " Dynamic pricing, internet penetration, greater automation and efficiency are the trends in the hospitality segment,"he says. On the development side, he sees each segment on an equitable growth track.

What should the industry look forward to in the future? "Fractional ownership, sale and rent back and similar schemes are already being formulated for many projects both in cities and the recreational and leisure segment," he says.

The Indian traveller is becoming more wealthy and discerning, he says. And for the Indian globe-trotter who will evaluate the Indian hospitality industry on a global platform, Aibara believes that "Exposure is great education!"