What steps govt should take for MSMEs in tourism to thrive in 2023 | The Financial Express

What steps govt should take for MSMEs in tourism to thrive in 2023

Ease of doing business for MSMEs: “With both government and industry acknowledging the importance and contribution of small businesses to tourism, in 2023 we foresee widespread tech adoption, and the launch of MSME-friendly policies and schemes which will strengthen the sector.”

Taiwan, Taiwan economy, Taiwan travel, travellers to get money in Taiwan, taiwan travel policy, Taiwan travel money, lifestyle
This popular tourist destination is offering visitors perks worth $165 each

By Anwar Shirpurwala

Ease of doing business for MSMEs: It is no secret that tourism is vital to India’s economic growth and development, more so as the country has enormous possibilities in this sector and has something to offer to everyone. India’s travel market was estimated at $75 billion in FY20 and the total contribution of travel and tourism to the country’s GDP was about 5.8 per cent. The tourism ministry has been proactively supporting the industry in rebuilding India’s tourism sector to make it more inclusive, resilient and sustainable post-Covid.

State governments are not far behind and have been playing their role to the hilt by innovating in policy making by launching new tourism policies, according to industry status and promoting niche tourism products. Having states showing hunger and competitiveness by coming up with attractive policies to get more investments only augurs well for India’s overall tourism sector.

However, considering India’s vastness and diversity, we are yet to realise our true potential in tourism. Although we have 40 UNESCO World Heritage Sites, we are yet unable to get the desired numbers of international visitors that smaller countries like Hong Kong, Dubai, and Vietnam get.

Also read: CHATT sets up a secretariat to strengthen MSMEs in tourism and hospitality sector

Since the pandemic, offbeat destinations have become a preferred choice for even domestic travellers in order to avoid crowded places. However due to factors like lack of infrastructure, low digital penetration clubbed with poor marketing capability of small businesses like homestays, BnBs, individual lodge owners and micro-entrepreneurs that mostly operate in these places, are not able to promote themselves as such tourist footfall remains low.

Non-availability of resources, cash crunch, and poor infrastructure, are other key impediments to the growth of these businesses that fear compliance owing to factors like lack of understanding on the policy front, government schemes, taxation etc. Bringing them into the formal sector is important to help them tide over these issues. For this, it is imperative to develop online tools and digital platforms to collate and spread information on key compliances, policy instruments, schemes, and benefits that can be availed upon formalisation.

While there are various government policies and schemes to address issues faced by the industry, implementation of the same has not been up to the mark. This calls for a systems approach for developing tourism through the integration of resources and stakeholders thereby undertaking various plans and programs viz., district-level tourism development with the participation of local industry representatives, influencers, youth as well as non-governmental organisations; cluster development program to provide common facilities for micro and small businesses to share amongst themselves; creating programs and projects towards awareness on policies, implementation of rules pertaining to waste management.

Also read: Govt needs to chart out a district-level strategy for hospitality and tourism MSMEs: CHATT

Building robust infrastructure, proper management, information sharing and developing new tourist attractions are certain ways to counter the challenge of overtourism during peak holiday seasons. Moreover, exposing small businesses to newer technologies through partnerships, adopting global best tech practices and generating opportunities for companies to develop hospitality, tourism and travel sector-specific tech solutions will go a long way in supporting the hospitality and tourism SMBs.

This, aligned with five broad missions focussed on green tourism, digital tourism, skilling, destination management organisations and MSMEs under the proposed New National Tourism Policy will get the ball rolling especially for hospitality, tourism and travel SMEs to make a transition from the informal to the formal sector, which is a very long process and requires strategic action plans to implement and monitor government policies.

India’s G20 presidency presents a huge opportunity for India to showcase our rich biodiversity, cultural diversity, heritage and the plethora of tourism offerings to travel buffs the world over. The Government of India’s conscious decision to hold about 200 meetings planned across 55 locations out of the metros as part of the country’s G20 presidency in 2023 will give every state and region a chance to get represented. With thousands of delegates expected to attend these meetings, it is but natural that it is going to give a huge fillip to the hospitality, tourism and travel sector, especially in destinations that are lesser known.

Subscribe to Financial Express SME (FE Aspire) newsletter now: Your weekly dose of news, views, and updates from the world of micro, small, and medium enterprises 

All in all, the tourism and travel industry remains bolstered by a recovery in domestic tourist footfall as well as the G20 presidency and India will be able to sustain this momentum going into the new year. With both government and industry acknowledging the importance and contribution of small businesses to tourism, in 2023 we foresee widespread tech adoption, and the launch of MSME-friendly policies and schemes which will strengthen the sector and help make their operations more efficient.

Anwar Shirpurwala is the Secretary General of the Confederation of Hospitality, Technology and Tourism Industry (CHATT). Views expressed are the author’s own.

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.

First published on: 14-01-2023 at 11:00 IST