REEMA LOKESH – Mumbai
The Indian Rupee is at its record low vis-à-vis the US Dollar and like any other industry this does not speak well especially for the outbound tourism sector. Industry entrepreneurs have expressed caution and concern on the Rupee-Dollar dynamics, with some facing the heat already and few who are predicting a rather tough time ahead for outbound tourism business. The demand supply rule has resulted in some correction in airfares as well. Speaking to Express TravelWorld Manoj Gursahani, chairman, Travelmartindia.com said, “The Rupee breaching the 60 mark is already having a huge impact on outbound travel, as most of the airlines have seats available. Also the cumulative costs for the family will go up significantly and in view of this, those going for leisure tours will postpone their trip for a future date and some might even opt for a domestic holidays.” Some tour operators have already witnessed a dip in bookings to destinations- Dubai, Bangkok, London, Paris, Italy and Switzerland.
Jaal Shah, group managing director, Travel Designer India added, “The Rupee has depreciated from 11 per cent to eight per cent when we compare it to February-March 2013. This reflects that there is a huge volatility making it difficult to predict the future. It seems that this is going to worsen as we see Rupee being looked at 61.50 to 62 against a Dollar.”
However Shah also feels that this development should benefit the inbound business. He mentioned, “This should help get good business for the inbound sector where international travellers are getting good value for what they intend to spend on, making their travel budgets cheaper by 10 per cent.”
While few other tour operators are of the opinion that as the Dollar gets stronger, people will plan their holidays and travel better and prudently. Subhash Motwani, director, Compact travels feels, “Even though there has been a significant drop in the Rupee, we have not seen any cancellation or postponement of trip from our clients. According to me, the depreciation in the Rupee rate could hover around 62 from now what it is at 60. However travellers will not stop travelling but will now plan their holidays much more in advance. There will be a change in destination preference and the kind of experience associated to it and the number of length of stay will also reduce from 12 days to eight days. The family segment will be affected by the depreciating Rupee rate.”
However a report from PhoCusWright –Asia Pacific states that despite facing a myriad of challenges from within and outside the travel industry, India remains among the fastest growing travel markets in the Asia Pacific region. Although the country’s slowing economy, depreciating Rupee, and ailing airline industry burden the travel market, gross bookings will march ahead by double digits through 2015, when they will reach US$28.8 billion.
Online travel in India continues to outpace the total travel market, with online gross bookings projected to reach US$12.5 billion in 2015, up 80 per cent over 2012.
(With inputs from Sayoni Bhaduri and Kahini Chakraborty)