Niche Tourism

(A growth Factor of Service Industry in India)

A Service sector is one of the important parts of Indian economic development. Indias service
sector contributes to about 61 per cent of the countrys gross domestic product (GDP), 35 per
cent of employment, a quarter of the total trade, and over half of the foreign investment inflows.
Its contribution to the Indian economy is particularly significant, with regard to employment
potential and impact on national income. This sector covers a wide range of activities, such as
transportation, tourism, communication, trading, finances, real estate and health, among others.
The services industry provides massive business prospects to investors. Without the sectors
capacity to generate revenue, it would be difficult for the Indian economy.
The Indian tourism and hospitality industry has emerged as one of the key industries driving
growth of the service sector in India. Indian tourism industry is thriving due to an increase in
foreign tourist arrivals and greater number of Indians travelling to domestic destinations than
before. In the past few years the real growth has come from within the domestic sector as around
30 million Indians travel within the country in a year. Strong growth in per capita income, rising
young population coupled with changing lifestyles are leading to greater expenditure on leisure
services. Hotels are an important component of the tourism product. They contribute in the
overall tourism experience through the standards of facilities and services offered by them. The
fortunes of the hospitality industry have always been linked to the prospects of the tourism
industry and tourism is the foremost demand driver of the industry. Travel & tourisms
contribution to capital investment is projected to grow at 6.5 per cent per annual during 20132023, above the global average of five per cent. The tourism policy of Government of India aims
at speedy implementation of tourism projects, development of integrated tourism circuits, special
capacity building in the hospitality sector and new marketing strategies.

Trends in contribution of tourism to service sector

Trends in the growth rate of service sector, growth rate of tourism and hotel industry and the
relative share of this sector in the service sector show that the share has increased continuously
and according to the latest estimates this sector is contributing 25 percent to the service sector.

Trends in Tourism contribution to service sectors

Source: Central Statistical Office (CSO)

A Service sector has grown at a growth rate of 5.5 percent in 2000-01 and at 6.5 in 2012-13. The
trend in tourism contribution to service sectors has increased substantially from 2000-01 to 201213. It increased from 14.6 to 25.1 %. This includes trade, hotels, and restaurants.

Present scenario of tourism industry

Tourism can play an important and effective role in achieving the growth with equity objectives
which we have set for ourselves. Government of India recognized tourism sector as one of the
important contributors to employment generation and economic growth.
India has a diverse portfolio of niche tourism products cruises, adventure, medical, wellness,
sports, MICE, eco-tourism, film, rural and religious tourism. India is the 16th most visited
country in the world, with a share of 1.56% in the worlds tourism receipts. India offers
geographical diversity, attractive beaches, 30 World Heritage Sites and 25 bio-geographic zones.
Tourism and hospitality, a key sector of the Indian economy, plays a key role in the growth of
Brand India. Globally, tourism ranks fifth as an export category after fuels, chemicals, food and
automotive products.
Indias travel and tourism economy is poised to grow 7.5% in 2015 over last year, exceeding the
6.9% growth that the global forum has predicted for the South Asian region.

As per planning commission an investment of Rs. 10 Lakhs creates 78 jobs in tourism sector
while same generates just 18 jobs in the manufacturing and 45 in the agriculture sector.
In 2014, the industry contributed Rs7.64 trillion and 36.7 million jobs to the Indian economy. By
the end of 2015, the travel and tourism sector will contribute Rs 8.22 trillion or 7% of Indias
gross domestic product (GDP) and 37.4 million jobsalmost 9% of total employment. There
will be 43 million jobs in travel and tourism sector in India by 2022. In total, nearly 266 million
jobs were supported by Travel & Tourism in 2013 - 1 in 11 of all jobs in the world.
Almost 750000 people in India are employed in hotels within India. Around 1 lakh people are
employed in motels on highways. The Employment in hotel industry is forecasted to increase to
2.8-3.5 million by 2020.80% of the manpower in employed in key hotel functions such as F&B,
front office and housekeeping. Most of them are young and less than 40 years of age.

Requirement Supply Gap in Tourism Sector

Source: http://www.tourism.gov.in/writereaddata/Uploaded/ImpDoc/020220120146055.pdf

Over all contribution of Indias travel and tourism sector to the overall economy is 6.7% of GDP,
against a global average of 9.8%

Inbound tourism in 2014 reached 7.46 million. Number of Domestic Tourist Visits to all
states/UTs were-1145 million in 2013 showing a growth rate of 9.6% over the previous year.

Future prospects of Indian tourism industry

According to the latest Tourism Satellite Accounting (TSA) research, released by the World
Travel and Tourism Council (WTTC)
a) The demand for travel and tourism in India is expected to grow by 8.2 per cent between 2010
and 2020 and will place India at the third position in the world.
b) According to WTTC forecasts, travel and tourism has the potential to contribute 46 million
jobs to the Indian economy by 2025.
c) The total contribution of Travel & Tourism to GDP is forecast to rise by 7.0% pa to
INR13,983.0bn by 2024 (6.8% of GDP).
d) The report forecasts India to get capital investment worth INR 3,981.3billion in the travel and
tourism sector in 2024.

Developing Niche Tourism Segments in India

With this scope of development in travel and tourism in India there is a need to develop new
segments of tourism Industry and there by development of Infrastructure and at the same time
preparing manpower resources to cater to the growing niche market of tourism Industry or in a
broader term that of service industry.
When developing new markets for Inbound Tourism, there is also a need to develop new
products or offerings i.e. developing niche segments. While stressing on the conventional
tourism products of heritage and culture, there have been concerted efforts on the part of Indian
states to develop Niche Tourism products and destinations around youth tourism, cinematic
tourism, rural tourism and health wellness and medical Tourism.

Health and Wellness Tourism:

India could be number one for growth globally in the wellness tourism sector in the next five
years, clocking over 20 per cent gains annually through 2017.
Wellness tourism is a USD 439 billion industry worldwide within the USD 3.2 trillion global
tourism industry, representing 14 per cent of all tourism spending. India's total wellness market
to surpass USD 18 billion in the next four years. Luxury Wellness Tourism segment is estimated
to grow nearly 50 per cent faster than global tourism by 2017.

Medical Tourism:
Many of the research shows the medical treatment cost in India is low by an average of 40 to
60%, when compared to western standards. This is the cost of full package which includes
accommodation, cost of treatment and accessibility (international).
As the popular slogan that goes around in the industry says, India offers First World treatment at
Third World prices. India produces almost 28,000 to 30,000 doctors and nurses each year and is
known worldwide for its competent and qualified professionals in this field.
India was one of the first countries to recognize the potential of medical tourism. From the year
2009 to 2011 the number of medical tourists in India has grown by 30%. It is estimated that by the
end of year 2015, India will receive nearly half a Million medical tourists annually.
The medical tourism market in India is projected to hit US$ 3.9 billion mark this year having
grown at a compounded annual growth rate (CAGR) of 27 per cent over the last three years,
according to a joint report by FICCI and KPMG. Also, inflow of medical tourists is expected to
cross 320 million by 2015 compared with 85 million in 2012. The tourism industry is also started
with E-visa scheme which is expected to double the tourist inflow to India.
It is utmost important at this stage to strengthen and recognize the super specialty hospitals
providing medical facilities and medical tourism facilities by service providers.
Youth Tourism: Indian youth is the largest market of a cross section of travel consumption,
ranging from Eco to the luxury of hiring flights for school students. There has been a marked
increase in youth travelers as compared to youth tourists around the world. The youth now wants
to explore, to see the world. Young independent travelers tend to travel more frequently and for
longer periods. Mumbai alone has seen an increase of 25% each year for the past 5 years in terms
of youth travelers. More than ten thousand students travel each year during their summer
vacations. According to the World Bank, by 2020, 34% of Indian population will be the youth.
By 2030, the average age of youth in India will be 29years as compared to the 37 in China and

USA and 45 in West Europe and Japan. India is and will continue to be the youngest country in
the world in the coming decades. Consequently, the number of students and youth travelers are
expected to increase exponentially. More than any other market segment, youth and student
travellers are leading with innovation and paving the way for responsible tourism.
Cinematic Tourism: The Indian Cinematic industry is one of the fastest growing sectors in the
country today and has grown from INR112 billion in 2012 to INR126 billion in 2013,
representing a growth rate of 13%. Over the years, the industrys revenues have grown
significantly and the projected size of the industry is estimated to reach INR220 billion by 2018.
The Indian Cinema industry is one of the largest producers of cinematographic films in the world
with an annual certification of 1,966 films during FY1314 .Furthermore, Indias favourable
regulatory environment and reforms such as 100% Foreign Direct Investment under the
automatic route has made the Indian Cinema market more attractive for international corporates,
bringing in significant investments.
161 million TV households, 94,067 newspapers (12,511 dailies), close to 2000 multiplexes, 214
million internet users In 2013 the Indian Media & Entertainment (M&E) industry registered a
growth of 11.8 per cent over 2012 and touched INR 918 billon. Overall, the industry is expected
to register a CAGR of 14.2 percent to touch INR 1785.8 billion by 2018.
The Television sector is projected to command half of the entertainment pie by 2015 as it is
estimated to grow at a robust 14.5% cumulatively over the next five years, from an estimated Rs.
30,650 crore in 2010 to Rs. 60,250 crore by 2015. The print sector is projected to grow by 9.6%
over the period 2011-15, reaching Rs. 28,200 crore in 2015 from the present Rs. 17,870 crore in
2010. Radio sector is projected to grow at a CAGR of 19.2% over 2011-15, reaching Rs. 2,600
crore in 2015. The total internet user base in India grew to approximately 214 million by end of
the year with almost 130 million going online using mobile devices.

Rural Tourism: Tourism growth potential can be harnessed as a strategy for Rural
Development. The development of a strong platform around the concept of Rural Tourism is
definitely useful for a country like India, where almost 74% of the population resides in its 7
million villages. Across the world the trends of industrialization and development have had an
urban centric approach. Alongside, the stresses of urban lifestyles have led to a counter
urbanization syndrome. This has led to growing interest in the rural areas. At the same time this
trend of urbanization has led to falling income levels, lesser job opportunities in the total areas
leading to an urbanization syndrome in the rural areas. Rural Tourism is one of the few activities
which can provide a solution to these problems. Besides, there are other factors which are
shifting the trend towards rural tourism like increasing levels of awareness, growing interest in
heritage and culture and improved accessibility, and environmental consciousness. In the
developed countries, this has resulted in a new style of tourism of visiting village settings to
experience and live a relaxed and healthy lifestyle. This concept has taken the shape of a formal
kind of Rural Tourism. It showcase rural life, art, culture and heritage at rural locations and in
villages, which have core competence in art & craft, handloom, and textiles as also an asset base

in the natural environment. The intention is to benefit the local community economically and
socially as well as enable interaction between tourists and local population for a mutually
enriching experience. So far, 153 rural tourism projects in 28 States/Union Territories have been
sanctioned by the Ministry of Tourism including 36 rural sites where UNDP has supported for
capacity building. Rural Tourism has a multiple forms of tourism in itself as it components
Components of Rural Tourism:

Heritage and Culture (Ethnic Tourism)

Learning and Education from natural environment about rural life style, art and culture
(Eco
Tourism)
Scenic value (Nature Tourism)
Religious value (Pilgrim Tourism)
Adventure/Sports based activities (Adventure Tourism)
Rural/Agrarian life style (Farm Tourism/Agritourism)
Rural Cuisine
Orchard Tourism

Thus promoting rural tourism in one or the other manner can ultimately help new forms of
tourism to grow in India.

RECOMMENDATION by ICSI
Cinematic Tourism

Cinematic Tourism to be promoted as a niche tourism product both nationally and

internationally through strong marketing and promotional strategies.

Conferences and Expos: Annual event, conference, expo, cinematic tourism Awards and
honours, Indian Cinematic Festival to be promoted globally.

Central compendium for cinematic tourism including government officials, Bollywood

person, Trade expert, Trade association member, conducting annual meetings, Cinema
shooting permissions and facilitation services through single channel. This body should
have branches in all states of India.

Incredible India campaign to promote Cinematic Tourism.

Media and Entertainment -To be part of Vocational training, 11 and 12 th onward at school
level and other Capacity Building and Skill Development Programmes by ministry of
Tourism, Govt. of India

Inviting NRIs to invest in cinematic tourism projects in India

List and directories should be made of important tourist destinations for Cinema
shootings for Hollywood. These directories apart from having list of locations, can have
Important Addresses/Contact Details-Technical people, the list of shops to hire equipment
for shooting, costume hiring ,ornament hiring ,set decoration, generators, crains etc. with
address, their tariff and rates.

Ministry of Tourism, Govt. of India to facilitate FAM (Familiarisation Trips) through

state tourism departments for production houses, to and from India and abroad.

Ministry of Tourism in collaboration with state tourism departments to develop a

separate brochure, other promotional literature material themed on Cinematic Tourism.

Cinematic Shooting Locations: Each state to choose 9-10 best locations in their state for
Media Entertainment Industry (Film, Tele serials, Ad Films shootings and events)

Development of Cinematic Tourism infrastructure at these Identified places.

(Accomodation, accessibility and local governance )

Each State to have a strong, updated single window clearance system under the super
Vision of one Nodal Office, for all production houses coming in India for film.

Talent bank of the state (dance groups, artists, theater artist etc.) should be acknowledge
and encouraged by state government by conducting talent hunt shows.

Talent Hunt at school and college level all over the country.

Cinematic Art Gallery/Cinematic Souvenirs Gallery at different places in the state.

Increase number of guides, linguist guides (viz. French /Spanish /Russian/German

/Chinese /Korean /Thai etc.) by conducting guide training programmes on regular basis.

Medical tourism

Medical Tourism to be promoted as a niche tourism product both nationally and

internationally through strong marketing and promotional strategies.

Enhanced participation of stakeholders in road shows and international fairs/overseas

events.
Approval of Medical Tourism Service Facilitators by Ministry of Tourism Government of
India.
Conference in key markets to forge networking with Global Health Insurance companies
and Referral points.

Coordinating implementation of guidelines for Accreditation of Wellness Centers across

India.
Ministry of tourism to give national awards to Medical Tourism facilitators and super
specialty hospitals through annual conference.
Special tourist information Centre in the premises of Super specialty hospital.
Trade experts /Medical tourism facilitator list should on the website of Ministry of
Tourism.
Bring in maximum number of service providers under MOT, GOI recognition through
publicity, road shows, travel marts etc.
Grant of approval / recognition to medical service providers within a prescribed time
frame and ensure prompt settlement of their claims/grievances.
Ministry of Tourism to recognise at national level local traditional health care practices of
respective states with the help of state government to be provided to the tourist coming
for health tourism and naturopathy.

Youth Tourism

Ministry of Tourism needs to evolve policies and programmes that lead to creation of
strong HRD infrastructure for the tourism sector. This requires, besides creating physical
infrastructure, well-planned syllabus reviewed at regular intervals, good remuneration to
attract and retain quality faculty/ trainers, generating opportunities for faculty to enhance
in their capabilities, close interaction with industry for maintaining the right balance
between theory and contemporary industry practices.
Ministry of tourism to launch Campaign/appeal and promote youth tourism at national
level.
Campaign to be run on national level in different parts of India Identifying selective cities
in each region of our country with special emphasis on North east
Organising various activities of Tourism quiz contests, Tourism awareness Talks, Tourism
essay and slogan writing competitions, conferences in different regions of India for
promotion of youth tourism, exhibiting youth talent for promotion of Indian Tourism,
Communication Idol contest for selecting the youth who could anchor and give their
voice for promotion of youth tourism.
Involving media entertainment industry-celebrities from promotion of youth tourism
Motivational cum awareness talk for tourism and vocational education in +2 schools and
college.
States/UT to organize Swatch Bharat campaign/awareness camps, involving youth to
participate.
Industry-students interface for skills development and capacity building through
workshops/events/seminars sponsored by Ministry of Tourism, state department, and
conducted by ICSI in collaboration with trade associations.

State/UT government to generate the data of schools and colleges and making a
schedule/planner to give talk/seminars/workshops for whole year in each state.

Rural Tourism:

Incredible India campaign to promote Rural and Heritage Tourism.

States to identify 4-5 villages having prospects to be developed for rural heritage tourism

Ministry of Tourism, government of India to recognise these as National Rural Heritage

village.

On the patterns of Chokhi Dhani these village then can promote their local and regional
cuisine, folk dance, folk songs, and handicraft.

Ministry of Tourism, Govt. of India can ask for a proposal of forming rural circuits all
over India for Integrated rural tourism development. For example North India Rural
Tourism circuit, North East India Rural Tourism circuit, West India Circuit, South India
Circuit.

Developing infrastructure at rural tourism site for tourist activities, rural accommodation,
rural cuisine, heritage hotels, home stays etc.

Rural Tourism can help in providing employment and entrepreneurship for localities.
Ministry of Tourism, Govt. of India along with finance ministry of India to help in getting
these opportunities to the rural youth.

Job Opportunities and Entrepreneurship avenues in Rural Tourism

1. Rural Accommodation-Rural Youth Hostels/Rural Bed and Breakfast establishments
2. Rural Tourism Infrastructure development
3. Rural Tourism Guide
4. Rural Destination Management Company
5. Rural Restaurants/Food Joints/Food Outlets
6. Animal Rides/Taming Animals/Ranch, farms, cattle lodging
7. Tourist Campsites
8. Houseboats
9. Camping equipments Hire
10. Boat stations
11. Dance and Theatre Group
12. Photographic Safaris
13. Bird Watching Tours
14. Adventure sports
15. Desert survival courses
16. Fishing camps
17. Craft Factory
18. Craft Outlets

19. Ayurvedic Centres/Traditional Healing Centres-Medicines

20. Theme Parks/Biosphere Reserve /Botanical Gardens
21. Gathering Products and Tracking Wildlife
22. Rural Museums
23. Silk moths/Honeybees/Butterflies/Snake/Reptiles breeding farm
24. Supply of firewood to camps/lodges/farm houses
25. Waste collection from camps/lodges/hostels etc.
26. Cleanliness and Hygiene Services
27. Thatching services
28. Supply of natural Minerals
29. Bottling and supply of spring or natural water
30. Supply of traditional food items
31. Supply of decorative and ornamental plants/Floriculture
32. Horticulture and Herbal cultivation/Organic Farming
33. Landscaping
34. Wild life consultancy
35. Rural Heritage conservation
36. Rural Tourism web blogging/Rural Tourism Marketing and Promotion
37. Dairy Processing
38. Eco Tourism based building material and Interior development

India has much potential to explore. Tourism being the strongest part of Service Industry
need to be planned in a very progressive and innovative manner by developing alternative
tourism and adapting active promotional strategies. Now is the time when our new tourism
policy is coming we need not to just plan but to regressly implement the plans into action and
to actually see their positive results in terms of overall growth in future.

Sources:
tourism.gov.in/.../Incredible%20India%20final%2021-7-2014%20english.
www.wttc.org/-/media/files/reports/.../country%20reports/india2014.pdf
http://www.academia.edu/6757989/GROWTH_AND_PROSPECTS_FOR_SERVICE_SECTOR
_IN_GLOBALIZED_ECONOMY_A_STUDY_OF_INDIAN_TOURISM_INDUSTRY_INTRO
DUCTION
FICCI Frames 2014 KPMG report.
http://tourism.gov.in/TourismDivision/AboutScheme.aspx?Name=Tourism%20Infrastructure
%20Development&CID=66&INO=6
http://www.incredibleindia.org/en/trade-product/products/rural-tourism
http://www.hospitalityindia.com/hospitality-industry-in-india.htm