Budget 2021-22: Funds Allocation For Travel And Hospitality

Although the budget has not offered any major relief to the struggling travel and tourism industry, providing Rs 1.15 lakh crore for railways and privatising airports, the government has given some aid to domestic tourism.

The budgetary allocation for the ministry of tourism has been slashed from Rs 2,500 crore in 2020-21 to Rs 2026.77 crore this year.

The revised estimate for the ministry was Rs 1,260 crore.

The budget has allocated Rs 1088.03 crore for development of tourism infrastructure, down by 34% in comparison to last years’ allocation of Rs 1655.21 crore. The union budget has also allocated a sum of Rs 63.65 crore for capacity building for service providers and Rs 138.65 crore for training and skill development.

Schemes: Pushing domestic tourism

The budget has included the Development of Iconic Tourist Sites/Destinations, a new central sector scheme, which has been framed for development of 19 identified iconic destinations in the country following a holistic approach involving infrastructure and skill development, use of technology, attracting private investment, branding and marketing. 

Two schemes- Swadesh Darshan and PRASHAD have both been continued this year.

Besides, the government has also made provisions to promote large revenue generating projects for development of tourism infrastructure and market research.

Promotion and Publicity

With the coronavirus crisis restricting not just foreign tourist footfalls into the country but also keeping domestic tourists at bay, the budget has focused on pushing funds for promotion and publicity to help woo tourists back. 

Out of the Rs 668.72 crore allocated towards promotion and publicity, Rs 524.02 crore is for the overseas market and Rs 144.70 crore has been kept for domestic tourists.

“The objective of this program is to position India globally as the most favoured destination. Promotional activities in some of the markets such as Spain, China, France, etc. are undertaken in vernacular languages for a wider and targeted reach and to establish representative offices of the Ministry in new markets,” the budget document read, adding that campaigns were also initiated to promote North East region and Jammu & Kashmir as tourist destinations. 

The government has also made budgetary allocation of Rs 5.27 crore towards Safe Tourist Destination for Women scheme.

Indirect Support: Transport Infrastructure 

The focus on transportation infrastructure that forms a crucial base for Inbound and Domestic Tourism, received a big push from the government. 

Besides, budgetary allocation of Rs 1.10 lakh crore for the railways in the budget, with total capital expenditure outlay of Rs 2.15 lakh crore for the coming financial year, the government announced an outlay of Rs 1.18 lakh crore for the Ministry of Road Transport and Highways (proposed 3,500 km corridor in Tamil Nadu, 1,100 km in Kerala, 675 km in West Bengal and 1,300 km in Assam in the coming 3 years). 

From an aviation perspective, the announcement of airport privatisation in tier 2 and 3 cities/towns will serve as a boon towards access and affordability. The creation of a hub and spoke model will serve to catalyse the government’s initiatives around Project UDAN and Regional Connectivity.

Among passenger-related announcements, the Budget mentioned more Vistadome coaches on tourism routes.

Naina Sood
Naina Sood
Naina was former staff at Dutch Uncles, she writes on business-life-cycle, funding, small businesses and start-ups.



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