KOCHI: The tourism sector, contributing nearly 12 per cent of the gross state domestic product of Kerala, is likely to see a major hit in tourist arrivals in the current season thanks to demonetisation. Both government and industry sources said the currency crunch has led to several cancellations of the bookings for the month of December, one of the peak seasons of tourist arrivals in the state.
Tourism principal secretary Dr V. Venu said that the state should expect a steep decline in tourism arrivals post-demonetisation. “Bookings have come down and there have been cancellations,” he said. Demonetisation disrupted the state’s traditional business model of tourism, he pointed out. “There is a large group of tourists who prefer to use cash and a large trading sector catering to the tourists who prefer to take physical cash as payment,” he said."I am not sitting in judgment over such behaviour, but it is the ground reality. The surprise announcement of demonetisation must have jolted this group."
President of Kerala Travel Mart Society Abraham George feels that the sector is likely see a fall of nearly 25-30 per cent tourist arrivals in the next three months. The cancellation for December has already crossed 20 per cent, he said. The peak season of tourist arrivals in the state is between December and March. The high-spending Indian tourists, comprising nearly 90 per cent of the arrivals in the state, have developed cold feet in the wake of the currency crunch.
According to Mr. George most foreign tourists convert their currency after reaching a destination and they are now finding it difficult to manage the situation. The purchases by the tourists, especially spices, handicraft and curios are the worst hit by the decision, he added. Dr Venu said that at the moment it was not possible for the tourism department to take any steps that would alleviate the situation.
“Even the little that we have asked for (certain exemptions for tourists like waiving of entry fee at destinations) was hard to implement,” he said. Apart from the fall in the arrival of tourists, a series of activities connected with the sector have been hit by the demonetisation. Traders in handicrafts, curios, foreign exchange dealers and a slew of others are the worst hit by the currency crunch. “The business for the current season has been washed out completely. I am hoping that the situation may improve after December 30,” says Vijaya Saradhy, a foreign exchange dealer in Varkala.
