So it’s back. Another crisis that will directly impact the Hospitality and Tourism Sector. But this is not the first time!! In my lifetime in the Hospitality Industry in India, it happened in 1994 as an aftermath of the Mumbai blasts. It happened due to the plague in Surat. The incident of 9/11 in New York was a defining moment on a global scale.
The Corona virus is Global on a much larger scale. Its effects as an epidemic shall remain till a cure is found. Its impact will however, be longer lasting. Both economic and social.
On the economic front we are all experiencing the complete loss of business and closure of hotels with no indication of when normalcy will resume. To my mind, the following may happen:
1. Once lockdown is over and travel is permitted, only essential business travel will take place.
2. Smaller meetings and Seminars will be curtailed both as a cost cutting measure and due to its replacement by “on line “ meetings.
3. Large Conferences, unless absolutely critical, will be postponed or cancelled, as a cost cutting measure.
4. Foreign essential business travellers to India will not be inclined to take brief side trips to iconic tourist spots such as Agra, Jaipur, Ellora etc. This was a significant tourism contribution.
5. Western traffic to India will reduce drastically due to it being long haul and they will not be inclined to travel to the East, the origin of the virus.
6. “Work From Home” culture will impact travel.
7. Travel confidence shall only be restored once a preventive or curative medicine is finally developed, which I hear could be around November 2020
The hospitality industry will thus recover very slowly and in stages. It may take more than a year post elimination of the virus to reach previous year levels. This will lead to tumultuous upheavals in the industry due to its severe financial impact and pressure on working capital. There could be several sales of assets, slump in revenues and consequent pressures on brands.
One thing for sure, apart from re-energising the National Green Tribunal and Pollution Control Board, the Government is likely to re-define health, hygiene and sanitation norms and enforce them with renewed vigour. So, hospitality service providers who have compromised on space, planning and implementation of proper hygiene and sanitation norms, shall have a lot to worry about.
The challenge, of course, shall be the un-organised sector, but looking at the present mood of the government, concrete steps will be taken.
To my mind the silver lining in the sky is our huge domestic tourism potential. Once travel confidence is restored, the great opportunities I see are in:
1. Encouraging mid-market and upmarket domestic travel as against outbound. We have lovely destinations all over the country and those should be promoted. Kashmir comes straight to my mind. It was THE Desination among the elite before the Far Eastern and European destinations took over. The un-tapped North East of India is also a great destination
One suggestion would be to give a tax rebate on domestic family holiday travel. This will encourage domestic travel, generate revenues, without any real cost to the government.
2. The current scenario provides us a great opportunity to promote Wellness Tourism which is India’s inherent knowledge of Meditation, Yoga, Ayurveda, Spirituality, Vast knowledge of Astrology as a Science based on Astronomy and its impact on our environment and us. And promotion of India’s huge repertoire of vegetarian cuisines. There has been a worldwide resurgence of interest in all this in the past few weeks
3. Once travel confidence is restored, hopefully around October or November, the third great market to tap is to encourage Destination Weddings, Weddings and Weddings, to fill up the empty convention spaces!!
One thing for sure. India will, as always, SURELY BOUNCE BACK