Tourism Industry in Kerala

KERALA
THE IMPACT OF TRAVEL &TOURISM

ON JOBSANDTHE ECONOMY
CHAIRMAN:
Sir Ian Prosser
Chairman
InterContinental Hotels Group
VICE CHAIRMEN:
Donald Carty
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American Airlines
Jonathan Tisch
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Loews Hotels
Rod Eddington
Chief Executive
British Airways plc
David Mongeau
Vice President
CIBC World Markets
Lalit Suri
Chairman & Managing Director
Bharat Hotels Ltd
Brett Tollman
Vice Chairman
The Travel Corporation
Mathias Emmerich
President & CEO
Rail Europe Group, Inc
Alan Mulally
Executive Vice President
The Boeing Company
Ian Swain
Chairman & CEO
Swain Travel Services Inc
Manuel Fernando Esprito Santo

President
Esprito Santo Tourism
John M Noel
President & CEO
The Noel Group
Kathleen Taylor
President,
Worldwide Business Operations
Four Seasons Hotels and Resorts
Laurence Geller
Chairman & CEO
Strategic Hotel Capital
Tom Nutley
Chairman
Reed Travel Exhibitions
Henri Giscard dEstaing

Chairman & CEO
Club Mditerrane
Alan Parker
Managing Director
Whitbread Hotel Company
Maurice H Greenberg
Chairman & CEO
American International
Group, Inc
Jean Gabriel Prs

President & CEO
Mvenpick Hotels & Resorts
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Akbar Al Baker
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Chairman of Management Board
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Giovanni Angelini
CEO & Managing Director
Andr Jordan
Shangri-La Hotels & Resorts
Chairman
Lusotur SA
David Babai
Chairman
Jonathan S Linen
Gullivers Travel Associates
Vice Chairman
American Express Company
Vincent A Wolfington
Chairman
Carey International, Inc
Phil Bakes
Chairman & CEO
FAR&WIDE Travel Corporation
Henrik Bartl
EXECUTIVE COMMITTEE: Head of International Hotel
Peter Armstrong
Financing
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Rocky Mountaineer Railtours
Gordon Bethune
Sebastin Escarrer
Chairman of the Board & CEO
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Continental Airlines
Sol Meli
Edouard Ettedgui
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Mandarin Oriental Hotel Group
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Worldspan
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Rgis Bulot
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Relais & Chteaux
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David House
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Carlson Companies
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Alun Cathcart
Deputy Chairman
Richard R Kelley
Chairman
Avis Europe plc
Outrigger Enterprises, Inc
U Gary Charlwood
Geoffrey JW Kent
Founder, Chairman & CEO
Chairman & CEO
Uniglobe Travel (International)
Abercrombie & Kent
Inc
J W Marriott, Jr
Chairman & CEO
Marriott International, Inc
David Michels
Chief Executive,
Hilton Group plc
Hilton International
Curtis Nelson
President and COO
Carlson Companies
Jennie Chua
Chairman & CEO
Raffles International
Hotels & Resorts
David Clifton
Managing Director,
Europe & Asia
Interval International
PRS Oberoi
Chief Executive
The Oberoi Group
Glen Davidson
Senior VP,Worldwide Travel
Insurance & Related Services
American International
Group Inc
Henry Silverman
Chairman, President & CEO
Cendant Corporation
Lloyd Dorfman
Chairman & Chief Executive
The Travelex Group
Richard Helfer
Raffles International
Hotels & Resorts
James Hensley
President
Allied Europe
James Hogan
President and Chief Executive
Gulf Air
Stephen Holmes
Vice Chairman
Cendant Corporation
Raimund Hosch
President & CEO
Messe Berlin GmbH
Joseph Humphry
CEO
Travelweb LLC
Xabier de Irala
Chairman & CEO
Iberia, Airlines of Spain
Nuno Trigoso Jordo
President & CEO.
Sonae Turismo Gesto
e Servios SA
Sol Kerzner
Chairman & CEO
Kerzner International Ltd
Nigel Knowles
Managing Partner
DLA
Krishna Kumar
Managing Director
The Taj Group of Hotels
Hans Lerch
President & CEO
Kuoni Travel Holding Ltd
Manuel Martin
Partner
CyberDodo Productions Ltd
Dionsio Pestana
Chairman
Group Pestana
Stefan Pichler
Chairman & CEO
Thomas Cook AG
Fernando Pinto
CEO
TAP Air Portugal
David Radcliffe
Chief Executive
Hogg Robinson plc
Jay Rasulo
President
Walt Disney Parks & Resorts
Kurt Ritter
President & CEO
Rezidor SAS Hospitality
Peter Rogers
President & CEO
Diners Club International
Carl Ruderman
Chairman
Universal Media
Bruno Schpfer
Mvenpick Hotels & Resorts
Robert Selander
President & CEO
MasterCard International
Per Setterberg
CEO
Global Refund Group
Eric Speck
Executive Vice President &
Chief Marketing Officer
Sabre Holdings Corporation
Barry Sternlicht
Chairman & CEO
Starwood Hotels & Resorts
Worldwide, Inc
Paul McManus
Ron Stringfellow
President & CEO
Executive Chairman
The Leading Hotels of the World Southern Sun Group
Jos Antonio Tazn

President & CEO
Amadeus Global Travel
Distribution
Jeffrey Toffler
Chairman
Coventry Partners
Mustafa Trkmen
CEO & Managing Director
Enternasyonal Tourism
Investments, Inc
Patrice Vinet
Partner
Accenture
Trevor de Vries
Deputy Managing Director
Mondial Assistance Group
Jurgen Weber
Chairman
Lufthansa German Airlines
Peter Yesawich
Managing Partner
Yesawich, Pepperdine,
Brown & Russel
HONORARY MEMBERS:
Lord Marshall of Knightsbridge
Chairman
British Airways plc
Sir Frank Moore, AO
Chairman
Taylor Byrne Tourism Group
Frank Olson
The Hertz Corporation
Grard Plisson
Co-Chairman, Supervisory Board
Accor
Tommaso Zanzotto
President
TZ Associates Ltd
CHAIRMAN EMERITUS:
James D Robinson III
General Partner
RRE Ventures
IMMEDIATE PAST
CHAIRMEN:
Harvey Golub
Retired Chairman & CEO
American Express Co
PRESIDENT:
Jean-Claude Baumgarten
Correct as at April 23, 2003
2003 WORLD TRAVEL & TOURISM COUNCIL

1-2 QUEEN VICTORIA TERRACE.SOVEREIGN COURT.LONDON E1W 3HA. UNITED KINGDOM
TEL: +44 (0) 870 727 9882 or + 44 (0) 207 481 8007 FAX: +44 (0) 870 728 9882 or + 44 (0) 207 488 1008 enquiries@wttc.org www.wttc.org
THE WORLD TRAVEL & TOURISM COUNCIL (WTTC) IS THE BUSINESS

LEADERS FORUM FOR TRAVEL & TOURISM, WORKING WITH
GOVERNMENTS TO RAISE AWARENESS OF THE IMPORTANCE OF THE
WORLDS LARGEST GENERATOR OF WEALTH AND JOBS.
With chief executives of more than 100 of the worlds leading companies in membership,
WTTC has a unique mandate and overview on all matters related to success in Travel &
Tourism.
WTTC is delighted to have collaborated with the Government of Kerala
The message from this report is surprisingly positive. Travel &
to produce this report the first simulated Tourism Satellite Account
Tourism is already one of the highest priority industries and employers
(TSA) for an Indian state. Kerala is also one of the first state/provincial
for the Kerala Government. Demand growth in Kerala is the highest in
governments in the world to quantify the far-reaching contribution of
the world and is projected to increase by 11.4 per cent per annum over
Travel & Tourism to economic growth and employment thanks to the
the coming decade.
implementation of this new accounting concept, approved by the United

Nations Statistical Commission.
However, in order to manage the projected demand, WTTCs

research highlights the need for Kerala to address mission-critical issues
This report estimates the current performance of Keralas Travel &
such as tourism policy planning, investment incentives, infrastructure
Tourism and provides forecasts based on the most recent national and
development, and marketing and promotion. In addition, sustainable
international data fed into econometric models developed by WTTCs
tourism development will depend on preservation and maintenance of
research partner, Oxford Economic Forecasting. It quantifies all aspects of
the states fragile ecosystem and the provision of facilities to train the
Travel & Tourism demand, from personal consumption to business
huge manpower required to adapt to the growth in demand.
purchases, capital investment, government spending and exports. It then
We hope that, by raising awareness of the enormous potential of
translates this information into economic concepts of production, such as
Travel & Tourism in Kerala, this report will act as a catalyst, encouraging
gross state product and employment, which can be compared with other
industry and government to work together to create the conditions
industries and the economy as a whole to provide credible statistical
necessary to realize this potential.
information that will assist in policy and business decision processes.
Jean-Claude Baumgarten
Yogesh Chandra
President,World Travel & Tourism Council
Secretary General,WTTC India Initiative
The World Travel & Tourism Council would like to express its sincere gratitude to the Members and secretariat of the WTTC India Initiative who have contributed their time,
effort and resources to this and many other important India projects. A complete list of WTTC India Initiative Members can be found on the inside back cover of this report.
CONTENTS
EXECUTIVE SUMMARY ____________________________________________________________________________
ECONOMIC IMPACT _________________________________________________________________________________________ 6

GROWTH____________________________________________________________________________________________________ 7
SUMMARY OF KEY TRENDS___________________________________________________________________________________ 9
KERALAS TRAVEL & TOURISM

OVERVIEW OF CURRENT TRENDS AND DEVELOPMENTS _____________________________________________________ 11
TRAVEL & TOURISM SATELLITE ACCOUNT

TSA CONCEPTS & STRUCTURE _______________________________________________________________________________ 14
TRAVEL & TOURISMS ECONOMIC IMPACT ___________________________________________________________________ 16
TSA HIGHLIGHTS ____________________________________________________________________________________________ 18
THE POLICY FRAMEWORK
____________________________________________________________________ 21
APPENDIX
SATELLITE ACCOUNT TABLES ________________________________________________________________________________ 26
Use of material is authorized, provided the source is acknowledged
EXECUTIVE
SUMMARY
THE IMPORTANCE OF TRAVEL & TOURISM TO KERALAS
ECONOMY IS INDISPUTABLE AND CURRENT FORECASTS
PROJECT A VERY ROSY FUTURE FOR THE INDUSTRY.
NEVERTHELESS, CARE MUST BE TAKEN TO ENSURE THAT
FUTURE TOURISM DEVELOPMENT IS SUSTAINABLE, AND
THAT KERALA ATTRACTS THE RIGHT KIND OF TOURISM
WITH BENEFITS FOR ALL STAKEHOLDERS.
The decision to develop a tourism satellite account
economic and social development across the whole of
(TSA) for Kerala was taken in June 2001 in an attempt
the state.
to explore the true potential of Keralas tourism product.
If managed effectively, Travel & Tourism can be an
The TSA research was conducted in December 2001
important catalyst for the development of other
and was based on data collected in the state at that time.
economic
sectors
within
the
state,
such
as
Kerala became WTTCs first partner state in India
manufacturing, construction and the service industries.
in 2000. In a communication to A K Antony, Chief
It can also help to protect Keralas primary assets, namely
Minister of Kerala, Jean-Claude Baumgarten, President
its largely unspoilt natural and cultural environment.The
of WTTC, said:
government has already taken steps to establish a
We recognize that Kerala has tremendous potential for
working partnership with the private sector. This will
Travel & Tourism.This partnership is designed to initiate and
facilitate harmonization of the two sectors development
strengthen a cohesive set of strategic policies to champion the
targets so that they remain complementary.
interest of Indias strongest economic growth sector and creator
Keralas Travel & Tourism directly contributes 3.7
of employment We look forward to actively working with
per cent of gross state product (GSP) and 3.0 per cent
you to strengthen tourism in your beautiful state and to make
of jobs. If its impact on the broader economy is taken
it the foremost provider of income and jobs in the coming
into consideration,Travel & Tourism generates as much
years.
as 7.7 per cent of GSP and 6.2 per cent of total
A late-comer to tourism, Kerala is in many ways in
employment. Visitor exports (tourism receipts from
a fortunate position, since it has the opportunity of
international and ex-Kerala Indian visitors including
learning from the mistakes of other destinations. In
spending on transport) are even more impressive in
particular, it needs to understand how to develop the
terms of share at 14.3 per cent of total exports.
enormous potential of its tourism product without
Over the next ten years, the average annual growth
over-exploiting its natural assets. Considerable care must
in visitor exports is forecast at 13.8 per cent, and the
be taken to ensure that growth achieves a healthy
growth in Travel & Tourism economy GSP and
balance between business imperatives, the protection of
employment will be 10.7 per cent and 10.9 per cent
cultural heritage and environment, and the well-being
respectively, according to WTTC/OEF. Yet to ensure
of local communities.
these growth levels are achieved, the Kerala Government
As is evident from the 1995 Kerala Tourism Policy
must place a much higher priority on Travel & Tourism
initiative, the state has strong support from government,
than is the case at present. Of key concern is the fact that
which is anxious to protect Keralas heritage and
government expenditures allocated to providing Travel
welcomes the advice and expertise that will help it to
& Tourism services to visitors, travel companies and the
achieve this. Nevertheless, while there is no doubt that
community at large are extremely low.
Travel & Tourism already drives Keralas economy in
The different measures recommended in this
terms of both employment and business opportunities
report are intended to set the stage to help ensure the
a number of challenges must be addressed if it is to
larger rewards that Travel & Tourism can bring over the
achieve its enormous potential as a catalyst for future
short, medium and longer term.

5
ECONOMIC IMPACT
IN 2003, KERALAS TRAVEL & TOURISM IS EXPECTED TO GENERATE RS102.2
BILLION (US$2.1 BN) OF ECONOMIC ACTIVITY (TOTAL DEMAND). THE
INDUSTRYS DIRECT IMPACT INCLUDES:
378,584
Rs
jobs representing 3.0% of total

EMPLOYMENT.
39.3
bn
(US$791.1 mn) of
GROSS DOMESTIC PRODUCT
(GDP) equivalent to 3.7% of total GDP.
HOWEVER, SINCE TRAVEL & TOURISM TOUCHES ALL SECTORS OF THE

ECONOMY, ITS REAL IMPACT IS EVEN GREATER. KERALAS TRAVEL &
TOURISM ECONOMY DIRECTLY AND INDIRECTLY ACCOUNTS FOR:
788,551
Rs
jobs representing 6.2% of total

EMPLOYMENT.
Rs
41.0
bn
(US$1.6 bn)
of GROSS DOMESTIC PRODUCT
equivalent to 7.7% of total GDP.
bn
Rs
(US$826.9 mn) of
EXPORTS, SERVICES & MERCHANDISE
or 16.6% of total Exports.
Rs
1.4
18.1
bn
(US$365.5 mn) of
CAPITAL INVESTMENT
or 7.8% of total Investment.
bn
(US$27.6 mn) of
GOVERNMENT EXPENDITURES
or a 1.0% share.
81.8
GROWTH
IN 2003,TRAVEL & TOURISM IN KERALA IS FORECAST TO SEE REAL GROWTH
OF:
12.2%
in total
TRAVEL & TOURISM DEMAND,
Rs102.2 bn (US$2.1 bn).
13.0%
in TRAVEL & TOURISM INDUSTRY GDP,

to Rs39.3 bn (US$791.1 mn) for the industry directly
and 11.6% to Rs 81.8 bn (US$1.6 bn)
for the Travel & Tourism Economy overall
(direct and indirect expenditures).
15.1%
in TRAVEL & TOURISM EMPLOYMENT

(direct impact only), to 378,584 jobs, and
13.8% to 788,551 jobs in the Travel & Tourism
Economy overall (direct and indirect).
OVER THE NEXT TEN YEARS, KERALAS TRAVEL & TOURISM IS EXPECTED TO
ACHIEVE ANNUALIZED REAL GROWTH OF:
11.4%
in total
TRAVEL & TOURISM DEMAND,
to Rs563.9 bn (US$7.5 bn) in 2013.
11.6%
11.4%
in total TRAVEL & TOURISM GDP,

to Rs216.5 bn (US$2.9 bn) in 2013 for the
industry directly and 10.7% to Rs423.5 bn (US$5.6 bn)
for the Travel & Tourism Economy overall.
13.8%
in TRAVEL & TOURISM EMPLOYMENT,

to 1,135,660 jobs directly in the industry,
and 10.9% to 2,221,370 jobs in the
Travel & Tourism Economy overall in 2013.
in VISITOR EXPORTS,
rising to Rs239.1 bn
(US$3.2 bn) by 2013.
8.3%
5.6%
in terms of CAPITAL INVESTMENT,

increasing to Rs75.1bn
(US$1.0 bn) in 2013.
in terms of
GOVERNMENT EXPENDITURES
to Rs4.4 bn (US$58.9 mn) in 2013.
SUMMARY OF
KEY TRENDS
Travel & Tourism is one of the largest industries in
connecting Kerala to Maharashtra via Karnataka and
Kerala today, contributing Rs39.3 billion (US$791.1
Goa will significantly boost tourism traffic to the
million), or 3.7 per cent, to the gross state product
Kerala coast.
(GSP). This is projected to rise to 5.2 per cent, or
Rs216.5 billion (US$2.9 billion) of GSP, by 2013.
with the result that over 85 per cent of domestic
travellers choose to travel by rail or use secondary roads
Keralas international tourism receipts (excluding
The state highways are yet to be full developed,
transport payments) have risen rapidly over the past
to reach Kerala.
decade. In 2000 the latest year for which detailed
statistics are available they totalled Rs5.3 billion
recognized by the Ministry of Tourism up from 122
(US$117 million).
in 2000. The total number of rooms available is 5,365
Kerala currently boasts 147 hotels that are officially
Visitor exports, meanwhile receipts from foreign
(4,499 in 2000), of which more than 54 per cent are in
and ex-Kerala Indian visitors, including transport
either the two- or three-star categories. The five-star
payments have also shown extremely sharp annual
category includes 569 rooms, or a 10.6 per cent share
growth, and are expected to rise by more than 16 per
down from 15 per cent in 2000.
cent in 2003 to Rs35.2 billion (US$709.9 million).
Keralas coastal resorts of Cochin, Kovalam,
In 2001, Kerala recorded 5.2 million domestic
Thiruvananthapuram, Thekkady, Kozhikode and
tourist arrivals, up 3.8 per cent on the previous year, and
Ernakulam account for more than 75 per cent of total
accounting for some 2 per cent of total domestic tourist
tourism traffic in Kerala.
arrivals in India. Average annual growth in domestic
tourism has been more than 18 per cent over the past
of the most attractive beaches in the country, such as
decade.
Kovalam, Varkala, Marari, Bekal and Kannur. Keralas
International tourist arrivals totalled 209,000 in
most popular backwater destinations are Kumarakom,
2001 and are estimated to have grown by 11.4 per cent
Alapuzha, Kollam, Kochi and Kozhikode, and its best-
in 2002 reaching 233,000, or a record 9.8 per cent of
known hill stations are Ponmudi, Munnar, Wynad and
Indias international arrivals count. In the last ten years,
Vagamon.
international arrivals in Kerala have risen by an average
11.8 per cent per annum
reserves, including the Periyar Wildlife Sanctuary,
Capital investment by the government and private
Eravikulam National Park, Thattekkad Bird Sanctuary
sector in Keralas Travel & Tourism is expected to total
and Parambikulam Wildlife Sanctuary. These parks
Rs18.1 billion (US$365.5 million) in 2003. Of this, a
remain relatively under-developed as tourist attractions.
very modest 2.5 per cent share is projected to come
from the states Annual Plan Allocation.
strongest growth sectors over the past few years for
Tourist arrivals in Kerala peak during the month of
Kerala, which has attracted attention as the home of
January and are at their lowest during May. The first
Ayurvedic medicine an ancient Indian science of
quarter of the year accounts for the highest share of
natural medicinal herbs used for curative and relaxation
foreign arrivals 31.3 per cent of the total annual count.
purposes.
Although air transport accounts for only a modest
Almost 600 kilometres of coastline include some
Kerala has a number of well-known wildlife
Health/wellness tourism has been one of the
Kerala is extremely rich in terms of culture and
8.7 per cent share of total arrivals in Kerala domestic
heritage the tradition of classical and folk arts in the
and international it is by far the preferred mode of
state dates back over a thousand years. Koodiyattom,
transport for foreign tourists. The two major ports of
one of the oldest art forms of Kerala and the only
entry are Thiruvananthapuram and Cochin, but Cochin
surviving form of the ancient Sanskrit drama was
is grossly under-utilized at present.
recently selected by UNESCO for proclamation as an
oral and intangible world heritage.
The opening of the new Konkan Railway
KERALAS
TRAVEL & TOURISM
OVERVIEW OF RECENT TRENDS AND DEVELOPMENTS
TAJIKISTAN
EN.
OCCUPIED BY PAKISTAN
AND CLAIMED
BY INDIA
JAMMU
AND
KASHMR
GHANISTAN
Srnagar
Kabul
Islamabad
Kasaragod
HIMCHAL
PRADESH
Lahore
Qandahr
OCCUPIED BY CHINA
AND CLAIMED
BY INDIA
OCCUPIED BY INDIA
AND CLAIMED
BY PAKISTAN
Shimla
PUNJAB
Quetta
Cannanore
Chandgarh
Lhasa
HARYNA
Delhi
Rohtak
New-Dehli
Sukkur
KISTAN
ARUNACHAL
PRADESH
NEPAL
UTTAR
PRADESH
Kathmandu
SIKKIM
RJASTHN
Dispur
Agartala
Bhopl
MADHYA
PRADESH
Indore
WEST
BENGAL
Calcutta
Jamnagar
Calicut
Imphl
MANIPUR
BANGLADESH
Dhaka
Tellicherry
Mahe
Badagara
Kozhikode
NGLAND
Kohima
MEGHLAYA
Shillong
Patna
BIHR
Ahmadbd
Itnagar
BHUTAN
ASSAM
Knpur
chi
Gndhnagar
Thimphu
Gangtok
Lucknow
Jaipur
GUJART
KERALA
Hosdrug
Amritsar
Faisalabad
Ponnani
Kunnamkulam
zawl
TRIPURA
Mandalay
Irinjalakuda
Chittagong
MAHRSHTRA
Bhubaneswar
Cuttack
Valparai
Chiang
Bay of
Bengal
Hyderbd
ANDHRA
PRADESH
Alwaye
MYANMAR
Bombay
Cochin
Kochi
PONDICHERRY
Rangoun
Yanam
Palghat
Chittur
Trichur
MIZORAM
ORISSA
Ngpur
Panaji
Ernakulam
Mattancheri
Kottayam
Changanacheri
Alleppey
Mavelikara
GOA
KARNTAKA
Madras
Bangalore
Indian
Ocean
PONDICHERRY
Kavaratti
LAKSHADWEEP
KERALA
TAMIL
NDU
Pondichery
PONDICHERRY
Kariakal
Jaffna
Quilon
Andaman Islands
ANDAMAN
Indian
Ocean
Shoranur
Attingal
Trivandrum
Neyyattinkara
SRI LANKA
Colombo
Nicobar Islands
NIC
MALDIVES
Kollam
Port Blair
&
Trivandrum
Punalur
GODS OWN COUNTRY
medicinal herbs used for curative and relaxation purposes.The region is
Sandwiched between the Western Ghats and the Arabian Sea, the Indian
also recognized for having developed a new form of physical yoga as a
state of Kerala is blessed with unmatched natural diversity that provides
means of rejuvenating mind and body.
immense scope for tourism. Within its 38,863 square kilometres, this
The extensive backwaters and lagoons are very popular attractions.
virtual paradise boasts a wide range of tourist attractions from serene
These offer the tourist a chance to escape from the mainland and
beaches and tropical islands to coastal lagoons and quiet backwaters,
disappear into the wilderness on a houseboat, or to stay at a remote
mist-clad hills stations, wildlife sanctuaries, unspoilt wilderness areas,
hotel or resort far away from lifes daily realities.
lush evergreen forests and a rich cultural heritage with unique art forms.
In addition, a moderate climate, a level of literacy far above the rest
of India, and a long history of community harmony, make this region a
RECENT TOURISM PERFORMANCE
unique tourism destination, positioned by the Keralites themselves as
One of the worlds fastest-growing tourism regions
Gods own country.
In the ten years to 2001, domestic tourist arrivals in Kerala increased by
In recent years Kerala has become known as the perfect haven for
an average annual rate of more than 18 per cent, while arrivals from
the traveller in search of improved health/wellness and, notably, a deeply
abroad rose by 12 per cent per annum.These growth rates are well above
relaxing and regenerating experience. This is thanks to the growing
the world averages and corroborate the findings of the WTTC and
popularity of Ayurvedic medicine an ancient Indian science of natural
Oxford Economic Forecasting (OEF) research.
11
has been the development and refinement of its Ayurveda tourism

Domestic tourist arrivals in Kerala, 1991-2001
product.The growing demand for health/wellness holidays whether to
Year
Arrivals ('000)
% annual change
test the Ayurvedic medicines claims to rejuvenate mind and body, or
1991
949
9.5
simply for regeneration and relaxation has come from both Western and
1992
994
4.8
Asian markets. Europe is an important source of tourism for India
1993
1,027
3.3
accounting for 35 per cent of arrivals as against 40 per cent from within
1994
1,284
25.0
Asia and 17 per cent from the Americas and Kerala has certainly
1995
3,916
204.9
benefited from Indias reputation as a fascinating tourism destination, rich
1996
4,403
12.5
1997
4,953
12.5
1998
4,482
-9.5
1999
4,888
9.1
2000
5,011
2.5
offering opportunities for houseboat cruising. Today, some houseboats
2001
5,200
3.8
have all the creature comforts of a good hotel.
in natural and cultural attractions.

But Keralas appeal for foreign tourists is also due to its own unique
attractions, such as its magnificent beaches and its quiet backwaters,
Source: Kerala Tourism Development Corporation (KTDC)
Tourism generates fairly low yields

Nevertheless, despite the enormous and rapid growth in tourism, a non-
During the 1990s, Kerala only recorded one year of decline in

domestic arrivals, in 1998. But growth picked up again sharply the
negligible share of Keralas foreign tourists is fairly low yield. The

average spend per tourist per trip is around US$550.
following year. Most domestic visitors travel to Kerala by rail or road;
International tourism receipts totalled Rs5.3 billion (US$117
air transport accounts for less than 7 per cent of arrivals. And a
million) in 2000 the last year for which details are available nearly
significant share of visitors are non-resident Keralites, visiting friends
19 times higher than in 1991, nine years earlier.
and/or relations.
Kerala's international tourism receiptsa, 1991-2000
A rising share of Indias foreign tourist count

In the ten years from 1991 to 2001, during which time Indias
international tourist arrivals doubled, Keralas more than tripled, with
6,000
120
5,000
100
the result that the southern Indian states share of the countrys total
arrivals increased from 5.6 per cent to 8.1 per cent. More significantly,
preliminary results for 2002 suggest that, while Indias arrivals declined
4,000
80
3,000
60
by 6.6 per cent the second consecutive year of decline Keralas rose
by 11.4 per cent, taking its share to as much as 9.8 per cent of Indias
2,000
total count.
A major contributor to Keralas tourism growth in the last few years
1,000
40
20
0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000
Receipts (Rs mnb)
Foreign tourist arrivals in Kerala and India, 1991-2002

Kerala's
arrivals
('000)
% annual change
Year
India's
arrivals
('000)
1991
1,236
69
na
5.6
1992
1,435
92
32.2
6.3
FUTURE TOURISM DEVELOPMENT
1993
1,443
95
3.9
6.6
1994
1,886
105
9.8
5.5
Governments increasingly important contribution
1995
2,124
143
36.7
6.7
1996
2,288
177
23.7
7.7
1997
2,374
182
3.2
7.7
catering to important visitors and State guests.The real Department of
1998
2,358
190
4.1
8.1
Tourism was not founded until 1960 and, even then, its initial role was
1999
2,482
202
6.4
8.2
confined to managing state-owned guesthouses and providing
2000
2,677
210
3.8
7.8
hospitality for important visitors. The state government did not
2001
2,537
209
-0.4
8.2
recognize tourism as an industry until the mid-1990s.
2002a
2,370
233
11.4
9.8
% annual
change
Kerala's
share
(%)
a Receipts excluding transport payments

b Rs47.40 = US$1 as at May 1, 2003
a Preliminary estimates
Source: KTDC;World Tourism Organization; Pacific Asia Travel Association
12
Source: KTDC
Kerala was a late starter in tourism. In 1950 the Department of Tourism

was created, but it only functioned as a State Hospitality Department
The first major step for tourism development in Kerala was taken
with the launch of the Kerala Tourism Policy in 1995. To quote the
policy itself:
The main aim is to serve as a guiding force to make maximum
Ministry of Tourism with a total of 5,365 rooms. Many of these have
use of Keralas tourism potential and also to make it an ideal
been developed with state money, but they are managed/operated by
instrument for social and economic growth.
the national/international groups. Indias Department of Tourism acts as
The policy was aimed at realizing Keralas tourism potential by
a coordinator, establishing broad collaborative agreements with groups
enhancing investment from the government and the private sector,
like Taj and Oberoi through Tourist Resorts (Kerala) Ltd, a subsidiary
improving the tourism product and harnessing human resources more
of the KTDC.
efficiently. An additional goal was to measure the influx of foreign and

domestic tourists.The 1995 Tourism Policy remains the basis for much
of the states progress over the last eight years, whether in terms of
Keralas classified hotel and room capacity, 2000
infrastructure and product development or tourism performance.

New beaches and backwater resorts have been opened up by the
Kerala Tourism Development Corporation (KTDC), which also
operates budget hotels, restaurants and cafs, as well as managing central
Category
No. of hotels
No. of rooms
5-star deluxe
93
5-star
584
4-star
465
3-star
39
1,602
the KTDC include the development of Ayurveda as a unique selling
2-star
36
940
point and the development and promotion of nature-based and heritage
1-star
24
703
tourism.
Heritage resorts
reservation systems and conducting tours. Other projects undertaken by
In line with the 1995 Kerala Tourism Policy, the government is also
Total
112
122
4,499
taking measures to create an investment-friendly atmosphere and to
Source: KTDC
generate confidence among non-resident Indians (NRIs) and other

prospective investors.A Tourism Investment Agency is planned, and this
The latest year for which a detailed breakdown of hotel
will act as a bridge between the investors and other institutions by
accommodation supply is available is 2000. As shown in the following
facilitating the procurement of land, electricity, communications and
table, most development has been in the one- to three-star categories.
other infrastructure facilities.
In 2000, 677 rooms (15 per cent of total supply) were in the five-star
Other necessary measures identified in the policy either

underway or in planning include the setting up of a Heritage Home
and five-star-deluxe categories; this share has since dropped to 569

rooms, or less than 11 per cent.
Protection Scheme to provide incentives for residents of Kerala to
Tour operators have also played a key role in the development of
convert their traditional homes into tourist accommodation. In
tourism to Kerala by creating unique and innovative tour options. Most
addition to the tourist circuits recognized by the Government of India,
of the leading tour operators in India such as Thomas Cook, SITA
places seen as having particular tourism potential will be identified as
and TCI feature Kerala prominently in their national and
tourism attractions. Special incentives and subsidies will be given to
international holiday brochures. A number of home-bred tour
entrepreneurs investing in these areas.
operators, like Kerala Travels, Great India Tour Company and Pioneer
The policy also highlights the need for a special Backwater
Travels, which have exhaustive knowledge of the state, have also
Tourism Plan, the training of specialized tour operators and other
established themselves as niche players in Keralas Travel & Tourism
human resource development, a proper marketing campaign, the
industry.
promotion of special fairs and festivals to attract tourists, and the
A joint Task Force, focusing on private-public sector partnership,
education of local communities to raise awareness of tourisms
has been constituted with major industry players and other stakeholders
importance and potential.
as members to act as advisors to the state government with regard to

tourism development activities. Keralite NRIs, who have also identified
tourism as a high growth sector for investment, are also involved.
The critical role of the private sector

While governments role has changed over the years, becoming more
that of a catalyst, or a facilitator for the growth of the industry,Travel &
Tourism is basically a private sector activity. The industrys spectacular
performance over the past decade has largely been driven by private
sector investment and involvement, which have helped to spread
tourism to hitherto virgin areas in the state such as Marari, Vythiri,
Kalpetta, Mananthavady and Poovar.
Major national and international hotel chains including Taj,
Oberoi, Le Mridien, Best Western, Golden Tulip, Casino and Mahindra
The main aim is to make maximum use of

Keralas tourism potential and also to make it
an ideal instrument for social and economic
growth.
have already established hotels and resorts in the state. Kerala currently
has 147 classified hotels ie hotels that are officially recognized by the
13
TSA CONCEPTS
& STRUCTURE
Year 2003 (US$ mn, 000 Jobs)
Personal Travel
& Tourism
Business Travel
757.6
Government
Expenditures
(Individual)
81.9
Visitor
Exports
Government
Expenditures
(Collective)
709.9
8.4
19.2
Capital
Investment
Exports
(Non-Visitor)
365.5
117.1
Travel & Tourism Consumption
1,557.8
Travel & Tourism Demand
2,059.5
Travel & Tourism Industry Supply
Travel & Tourism Economy Supply (Residual)
1,557.8
Travel & Tourism Industry GDP

(Direct Only)
501.8
Imports
357.3
Travel & Tourism Economy Supply
T&T Industry GDP (Indirect)

409.3
791.1
Comp.
Indirect
Taxes
Operating
Surplus Subsidies
Depreciation
2,059.5
Travel & Tourism Economy GDP
(Direct and Indirect)
Imports
1,647.8
T&T Industry
Employment
378.6
T&T
Economy
Employment
Property
Taxes
Property
Taxes
788.6
Personal
Income Taxes
Indirect
Taxes
Travel & Tourism Taxes
14
411.7
Corporate
Taxes
Travel & Tourism Satellite Accounting research for Kerala reflects a
made on behalf of the community at large, such as tourism
comprehensive simulation of the new international standard
promotion, aviation administration, security services and resort
adopted by the United Nations following the Enzo Paci World
area sanitation services.
Conference on the Economic Impact of Tourism (Nice, France,
Capital Investment by Travel & Tourism providers (the private
June 1999), ten years of model development and TSA experience by
sector) and government agencies (the public sector) to provide
WTTC and Oxford Economic Forecasting (OEF), and application of
facilities, equipment and infrastructure to visitors.

Exports (Non-Visitor) which include consumer goods sent
OEFs latest macro-economic forecasts.
out of Kerala for ultimate sale to visitors (such as clothing,
TSA Economic Concepts
electronics or petrol) or capital goods sent out of Kerala for use by
The Travel & Tourism Satellite Account is based on a demand-side
industry service providers (such as aircraft or cruise ships).
concept of economic activity, because the industry does not produce or
By employing input/output modelling separately to these two
supply a homogeneous product or service like traditional industries
aggregates (Travel & Tourism Consumption and Travel & Tourism
(agriculture, electronics, steel, etc). Instead, Travel & Tourism is an
Demand), the Satellite Account is able to produce two different and
industrial activity defined by the diverse collection of products (durables
complementary aggregates of Travel & Tourism Supply: the Travel &
and non-durables) and services (transportation, accommodations, food and
Tourism Industry and the Travel & Tourism Economy.The former
beverage, entertainment, government services, etc) that are delivered to
captures the explicitly defined production-side industry equivalent,
visitors.There are two basic aggregates of demand in the TSA:
direct impact only, for comparison with all other industries, while the
Travel & Tourism Consumption represents the value of
latter captures the broader economy-wide impact, direct and indirect, of
products and services that have been consumed by visitors. It is the
Travel & Tourism.Through this process, the Satellite Account is also able
basic demand-side aggregate used to construct an explicitly defined
to determine that portion of supply, which it Imports.

Next, the satellite account breaks down both aggregates of supply
production-side industry equivalent for comparison with all other

industries.Travel & Tourism Consumption includes:
(Industry and Economy) into the direct and indirect impacts of Gross
Personal Travel & Tourism, more formally known as consumer
State Product (GSP), the main descriptor of economic production, as
expenditures, which captures spending by Kerala residents on
well as the various components of GSP (Wages & Salaries,
traditional Travel & Tourism services (lodging, transportation,
Indirect/Transaction Taxes, Operating Surplus, Depreciation
entertainment, meals, financial services, etc) and goods (durable
and Subsidies). Beyond the regular TSA accounts, a separate analysis is
and nondurable) used for Travel & Tourism activities.
also provided of Personal Income Taxes paid by Travel & Tourism
Business Travel by government and industry, which mirrors

Personal Travel & Tourisms spending on goods and services
Travel & Tourism companies.
(transportation, accommodation, meals, entertainment, etc), but
Finally, one of the most important elements of the Travel & Tourism
represents intermediate inputs used in the course of business or
Satellite Account are the Employment results, which can now be
government work.
quantified for the basic Travel & Tourism Industry and the broader Travel
Government Expenditures (Individual) by agencies and

departments which provide visitor services such as cultural (art
& Tourism Economy.
T&T Industry Employment generally includes those jobs with
museums), recreational (national park) or clearance (immigration/
face-to-face contact with visitors (airlines, hotels, car rental,
customs) to individual visitors.
restaurant, retail, entertainment, etc).
Visitor Exports, which include spending by international and

ex-Kerala domestic visitors goods and services.
II
generated employment and Corporate and Property Taxes paid by
Travel & Tourism Demand builds on Travel & Tourism

consumption to include Travel & Tourism products and services
associated with residual components of final demand. It is used to
construct a broader economy-wide impact of Travel & Tourism.
The residual elements of Travel & Tourism demand are:
Government Expenditures (Collective) made by agencies
T&T
Economy
Employment includes T&T Industry
Employment plus those faceless jobs associated with:

Industry suppliers (airline caterers, laundry services, food
suppliers, wholesalers, accounting firms, etc).
Government agencies, manufacturing and construction of capital
goods and exported goods used in Travel & Tourism.
Supplied commodities (steel producers, lumber, oil production,
etc).
and departments associated with Travel & Tourism, but generally

15
TRAVEL & TOURISMS

ECONOMIC IMPACT
TRAVEL & TOURISM ENCOMPASSING TRANSPORT,ACCOMMODATION,
CATERING, RECREATION AND SERVICES FOR VISITORS IS ONE OF
KERALAS HIGHEST PRIORITY INDUSTRIES AND EMPLOYERS.
Worldwide in 2003, it is expected to post US$4.5 trillion of economic
In Kerala, in 2003,Travel & Tourism Economy employment is estimated
activity (Total Demand) and this is forecast to grow to US$8.9 trillion
at 788,600 jobs, or 6.2 per cent of total employment. By 2013, this
by 2013.
should grow to more than 2.2 million jobs 15.0 per cent of total
Travel & Tourism Total Demand in India is expected to total Rs1,519.7
employment.The 378,600 Travel & Tourism Industry jobs will account
billion (US$30.1 billion) in 2003, growing to Rs6,736.3 billion
for 3.0 per cent of total employment in 2003 and are forecast to rise to
(US$88.8 billion) in 2013.
1.1 million jobs, or 7.7 per cent of the total, by 2013.
In Kerala, in 2003,Travel & Tourism is expected to post Rs102.2 billion
Travel & Tourism is a major exporter, with inbound visitors injecting
(US$2.1 billion) of economic activity (Total Demand), growing to
foreign exchange directly into the economy.
Rs563.9 billion (US$7.5 billion) by 2013.
Travel & Tourism exports in India are expected to represent 5.9 per cent
In 2003, the Travel & Tourism Industry should contribute 3.7 per cent
of total exports in 2003, declining to 5.7 per cent in 2013.
to worldwide GDP. The broader Travel & Tourism Economy should
In Kerala, exports are a fundamental component of Travel & Tourisms
contribute 10.2 per cent to world GDP in 2003.
contribution to GSP. Of Keralas total exports including foreign and
In India, the Travel & Tourism Industry is expected to post a GDP
ex-Kerala Indian visitor exports, services and merchandise Travel &
contribution of 2.0 per cent in 2003, while the Travel & Tourism
Tourism is expected to generate 16.7 per cent (Rs41.0 billion, or
Economy contribution will be 4.8 per cent.
US$827.0 million) in 2003, increasing to Rs269.7 billion, or US$3.6
In Kerala, the Travel & Tourism Industry is expected to contribute 3.7
billion (22.4 per cent of total exports), by 2013.
per cent to GSP in 2003 (Rs39.3 billion, or US$791.1 million), rising to
Travel & Tourism is a catalyst for construction and manufacturing. In
Rs216.5 billion, or US$2.9 billion (5.2 per cent of total GSP), by 2013.
2003, the private and public sectors combined are expected to spend
The Travel & Tourism Economy contribution should grow from 7.7 per
US$686.0 billion in new Travel & Tourism capital investment worldwide
cent (Rs81.8 billion, or US$1.6 billion) to 10.2 per cent (Rs423.5
9.6 per cent of total investment rising to US$1.3 trillion, or 10.1 per
billion, or US$5.7 billion) over the same period.
cent of the total, in 2013.
Travel & Tourism is a high-growth activity, which is forecast to increase
Indias Travel & Tourism Capital Investment is expected to total Rs412.9
its total economic activity by 4.6 per cent per annum worldwide in real
billion, or US$8.2 billion, in 2003 7.0 per cent of total capital
terms over the next ten years.
investment.
In India, Travel & Tourism is expected to post average annualized gains
Year 2003 capital investment in Keralas Travel & Tourism Economy is
of 8.8 per cent between 2004 and 2013.
estimated at Rs18.1 billion (US$365.5 million), or 7.8 per cent of total
For Kerala,Travel & Tourism economic activity is expected to grow by
investment. By 2013, this should reach Rs75.1 billion (US$1.0 billion),
11.4 per cent per annum in real terms between 2004 and 2013.
or 8.3 per cent of total capital investment.
Travel & Tourism is human resource intensive, creating quality jobs
Travel & Tourism is both a generator and receiver of government funds.
across the full employment spectrum. In 2003, one in 13.2 jobs is
Globally, in 2003, Travel & Tourism is expected to generate US$843.6
generated by the Travel & Tourism Economy. The Travel & Tourism
billion of taxes 11.7 per cent of total taxation while channelling
Industry accounts for 2.6 per cent of global employment.Today there are
US$224.1 billion of government expenditures, or 3.9 per cent of total
67.4 million Travel & Tourism Industry jobs and 194.6 million jobs in
expenditures. By 2013, taxes should increase to US$1.5 trillion 12.4
the Travel & Tourism Economy, and these will rise to 83.9 million Travel
per cent of the total and government spending on Travel & Tourism to
& Tourism Industry jobs and 247.2 million Travel & Tourism Economy
US$378.2 billion 4.1 per cent of total government expenditure.
jobs by 2013.
In Kerala, government Travel & Tourism operating expenditures in 2003
Indias Travel & Travel Industry is expected to generate 11.1 million jobs
are expected to total to Rs1.4 billion (US$27.6 million), or 1.0 per cent
in 2003 (2.7 per cent of total employment), while the broader Travel &
of total government spending. In 2013, this spending is forecast to rise
Tourism Economy will account for 23.8 million jobs (5.8 per cent of
to Rs4.4 billion (US$58.8 million), or 1.1 per cent of total government
total employment).
spending.
16
KERALA ESTIMATES AND FORECASTS

Rs bn
Personal Travel & Tourism
Business Travel
Government Expenditures
2003
% of Total
Growtha
Rs bn
2013
% of Total
Growthb
37.6
5.4
10.9
195.7
7.2
10.8
4.1
---
17.4
19.1
---
9.7
1.4
1.0
4.8
4.4
1.1
5.6
Capital Investment
18.1
7.8
7.7
75.1
8.3
8.3
Visitor Exports
35.2
14.3
16.0
239.1
19.9
13.8
Other Exports
5.8
2.4
10.8
30.6
2.5
10.9

T&T Industry GDP
T&T Economy GDP
102.2
---
12.2
563.9
---
11.4
39.3
3.7
13.0
216.5
5.2
11.4
81.8
7.7
11.6
423.5
10.2
10.7
T&T Industry Employmentc
378.6
3.0
15.1
1,135.7
7.7
11.6
T&T Economy Employmentc
788.6
6.2
13.8
2,221.4
15.0
10.9
a2003 Real Growth Adjusted for Inflation (%); b2004-2013 Annualized Real Growth Adjusted for Inflation (%); cEmployment in '000 Jobs
INDIA ESTIMATES AND FORECASTS

Rs bn
2003
% of Total
748.3
4.5
Growtha
7.9
Rs bn
3,286.1
2013
% of Total
Growthb
5.4
8.7
Business Travel
91.5
---
0.7
465.4
---
10.4
32.5
1.0
3.8
101.8
1.0
5.1
Capital Investment
412.9
7.0
6.8
1,616.7
7.4
7.5
Visitor Exports
156.1
3.9
8.2
802.4
3.6
10.5
78.4
2.0
15.6
463.9
2.1
12.0
1,519.7
---
7.4
6,736.3
---
8.8
Other Exports
T&T Industry GDP
529.4
2.0
6.1
2,153.4
2.2
7.9
1,274.6
4.8
6.5
5,180.2
5.3
7.9
11,093.1
2.7
1.0
12,659.9
2.7
1.3
23,839.8
5.8
1.3
27,684.9
6.0
1.5
2013
% of Total
Growthb
T&T Economy GDP
WORLD ESTIMATES AND FORECASTS

US$ mn
2003
% of Total
Growtha
US$ mn
2,135,860
9.9
2.2
3,862,270
10.8
3.7
Business Travel
488,765
---
0.6
871,716
---
3.7
224,058
3.9
2.8
378,172
4.1
3.0
Capital Investment
685,957
9.6
2.8
1,308,620
10.1
4.3
Visitor Exports
530,912
5.9
3.0
1,332,080
6.0
7.1
Other Exports
478,952
5.3
8.9
1,186,990
5.4
7.2
4,544,240
---
2.9
8,939,730
---
4.6
T&T Industry GDP
1,280,350
3.7
1.1
2,279,200
3.8
3.6
T&T Economy GDP
3,526,850
10.2
2.0
6,461,360
10.8
3.9
67,441.1
2.6
0.1
83,893.6
2.8
2.2
194,562.0
7.6
1.5
247,205.0
8.4
2.4
17
TSA HIGHLIGHTS
KERALA
Travel & Tourism Total Demand
(2003 Est Rs bn)
TOTAL DEMAND
Travel & Tourism in Kerala is expected to total
Rs102.2 billion of Total Demand in 2003, growing
12.2 per cent over 2002 levels, and is expected to
grow a further 11.4 per cent per annum over the
next decade.
The largest portion of Kerala Travel & Tourism
Demand is personal consumption by residents at
Rs37.6 billion followed by international and exKerala Visitor Exports of Rs35.2 billion.
KERALA
Travel & Tourism Total Demand
(Cumulative Real Growth, %)
Personal Travel & Tourism (37.6)

Other Exports (5.8)
300
250
200
150
100
50
Visitor Exports (35.2)

Capital Investment (18.1)
Government Expenditures (1.4)
0
1990
Business Travel (4.1)
KERALA
Travel & Tourism Employment
('000 Jobs)
EMPLOYMENT
The Travel & Tourism Industry in Kerala is
expected to yield directly 378,600 jobs in 2003, or
3.0 per cent of total employment. A total of
788,600 jobs (direct and indirect), or 6.2 per cent
of total employment are expected to be generated
across the broader spectrum of the Travel &
Tourism Economy.
Over the next ten years, Keralas Travel &
Tourism Industry is expected to create 757,100
jobs while the broader Travel & Tourism Economy
is expected to create 1.4 million new jobs.
GSP
The Travel & Tourism Industry in Kerala is
expected to produce directly Rs39.3 billion, or 3.7
per cent, of total gross state product (GSP) in 2003.
The broader Kerala Travel & Tourism Economy
(direct and indirect) is expected to produce Rs81.8
billion, or 7.7 per cent of total GSP.
The long-term expectations for Travel &
Tourism GSP are exceedingly positive - exceeding
10.7 per cent annualized real growth.
1,000
Economy
2000
2005
2010
KERALA
Travel & Tourism Economy Employment
Industry
300
800
250
600
200
150
400
100
200
50
0
0
1999
2000
2001
2002
2003
1990
2004
KERALA
Travel & Tourism GSP
(1990 Constant US$ mn)
2,000
Economy
1995
2000
2005
2010
KERALA
Travel & Tourism Economy GSP
Industry
300
1,500
250
200
1,000
150
100
500
50
0
0
1999
18
1995
2000
2001
2002
2003
2004
1990
1995
2000
2005
2010
KERALA
Travel & Tourism Capital Investment
KERALA
Travel & Tourism Capital Investment
CAPITAL INVESTMENT
450
300
400
In 2003, Travel & Tourism Capital Investment in

Kerala is expected to reach Rs18.1 billion or 7.8
per cent of total investment. By 2013, this figure is
expected to grow to Rs75.1 billion or 8.3 per cent
of total capital investment, representing ten years of
8.3 per cent annualized growth.
250
200
350
150
100
300
50
250
0
1999
2000
2001
2002
2003
2004
1990
KERALA
Personal & Business Travel & Tourism
1,250
Business
1995
2000
2005
2010
KERALA
Personal
300
1,000
250
750
200
150
500
100
250
50
0
0
1999
2000
2001
2002
2003
1990
2004
KERALA
Travel & Tourism Exports
1,250
Other
1995
2000
2005
2010
KERALA
Travel & Tourism Exports
Visitor
300
1,000
250
750
200
150
500
100
250
50
0
0
1999
2000
2001
2002
2003
1990
2004
KERALA
Travel & Tourism Govt Expenditures
1995
2000
2005
2010
PERSONAL & BUSINESS

In 2003, Kerala is expected to generate Rs37.6
billion of Personal Travel & Tourism consumption
by residents, or 5.4 per cent of total personal
consumption. In Kerala, business travel in 2003 is
expected to total Rs4.1 billion.
Over the next decade (2004-2013), Personal
Travel & Tourism in Kerala is expected to grow at
an annual rate of 10.8 per cent, while Business/
Government Travel is forecast to grow at a slightly
lower annual rate of 9.7 per cent.
EXPORTS
Travel & Tourism Exports to international and exKerala visitors play a fundamental role in Keralas
Travel & Tourism business.
In 2003, Travel & Tourism services and
merchandise exports for Kerala are expected to
total Rs41.0 billion or 16.7 per cent of total
exports for the state.
Over the next decade, Visitor Exports are
expected to grow at an annual rate of 13.8 per cent,
one of the highest rates in the world.
KERALA
Travel & Tourism Govt Expenditures
GOVERNMENT
35
300
In 2003, national, state and local government

agencies in Kerala are expected to spend Rs1.4
billion of current operating funds for Travel &
Tourism. This represents 1.0 per cent of total
government expenditures, which are allocated to
providing individual and collective government
Travel & Tourism services to visitors, travel
companies and the community at large.
250
30
200
150
25
100
50
20
0
1999
2000
2001
2002
2003
2004
1990
1995
2000
2005
2010
19
THE POLICY
FRAMEWORK
POLICY RECOMMENDATIONS
The development of the 1995 Kerala Tourism Policy is a clear indication that the
government of Kerala recognizes the contribution that Travel & Tourism can make to the
states economy, both in terms of wealth creation and employment generation.The steps
that have already been taken to harness the regions tourism potential are a further
reflection of the governments commitment to the industry.
Nevertheless, despite the growing recognition of Travel & Tourisms
destination through the rational utilization of resources with a focus on the
importance, there seems to be a lack of appreciation of the full scope of
integrated development of infrastructure, conserving and preserving the heritage
the industry and its potential as a catalyst for the development of other
and environment and enhancing productivity, income, creating employment
areas of economic activity, such as agriculture, manufacturing or
opportunities, alleviating poverty, thereby making tourism the most important
financial services. Moreover, the full significance of Travel & Tourism as
sector for the socio-economic development and environmental protection of the
an instrument of social transformation is still not yet fully understood.
State.
This lack of appreciation of Travel & Tourisms potential means that

their impact on the industry. Government expenditures allocated to
Establish Development Authorities for selected

destinations
providing individual and collective government Travel & Tourism
Kerala has some of the finest beaches in India. However, unplanned
services to visitors, travel companies and the community at large are very
construction, over-population and overcrowding can considerably
low, and there are inadequate incentives to encourage capital investment
diminish their appeal. One example is Kovalam beach which, due to its
by the private sector. Despite the bullish forecasts, neglect of this kind
proximity to Thiruvananthapuram, was one of the first tourist attractions
could endanger the long-term success of Keralas Travel & Tourism.
in the state. Kerala should ensure that newly developed beaches do not
government policies could be drawn up without sufficient attention to
The government is the primary owner of Keralas tourism product
suffer the same fate.
and should therefore lead the way by encouraging continued investment,
The 1995 Kerala Tourism Policy spoke of the constitution of
building infrastructure and streamlining and coordinating tourism-
development agencies to ensure the integrated development of tourism
related policies and activities. However, the private sector also has a
destinations. WTTC also notes that Bekal beach was identified as a
critical role to play and needs to be proactive in developing quality
special tourism area by the Government of India and a development
products and services geared to international and domestic demand.The
authority was recommended for its planned expansion.
private sector should therefore continue to develop quality hotels, travel
WTTC recommends that the Government of Kerala constitute
agencies and transport services, while the government needs to relinquish
independent development agencies for each identified tourism
responsibility for areas that are best managed by private enterprise.
destination. These agencies should draw up integrated Master Plans for
Against this background WTTC recommends that the Kerala

Government:
their respective areas, using the services of world-class area planners,

architects and landscape artists.The development agencies would also be
responsible for the creation of the essential infrastructure such as
highways, interconnecting roads, power, water and sewage systems,
PLAN FOR THE FUTURE
airports, railway stations and basic municipal services. Land should be
Long-term tourism planning
allotted to private developers of hotels, restaurants, motels, shopping and
In line with the strategy outlined in the 1995 Kerala Tourism Policy,
commercial facilities, sports and entertainment, business and support
long-term development plans should be drawn up in consultation with
services.
the municipal authorities and the private sector to ensure sustainable
The
Development Authorities
should
involve
the
best
tourism development, including optimal land-use planning. The plans
administrators in the state, and private sector investors should nominate
should be drawn up in accordance with the states Tourism Vision,
powerful representatives to sit on the working boards. The agencies
namely:
could raise funds from government and financial institutions, which
To make Kerala, Gods Own Country, an upmarket, high-quality tourism
could be repaid through the sale of the developed land to investors.

21
Encourage greater market and product

diversification
Keralas greatest tourism assets include its beaches, its inland water
systems and its nature/wildlife reserves. In order to tap the full potential
of the beaches and backwaters for tourism, it is essential to have luxury
boats, cruise boats, houseboats and yachts. These will help Kerala attract
high-yield foreign and domestic visitors.WTTC has noticed that utility
vessels geared for local transport are frequently used to transport tourists
within the backwaters and along the coast.These modes of transport are
not appealing to the affluent tourist.
It is recommended that a concerted policy be adopted to permit
private entrepreneurs to import luxury sailing vessels from the Middle
East, Singapore and elsewhere. Financial assistance from institutions
should be encouraged and the central/state governments import taxes
should be significantly reduced to facilitate the process.
Market and product diversification should be a high priority for the
Kerala Government since it will enhance the destinations
competitiveness and improve added value and yield.The state already has
a number of different tourism products that have proved popular with
domestic and foreign visitors. As a start, these can be expanded and
improved.The following provide some examples.
Coastal cruises
Luxury cruise boats would ensure the development of coastal travel,
eventually linking Keralas beaches and inland water destinations to the
Lakshadweep and Maldives islands, as well as to Sri Lanka and other parts
of Southeast Asia. The development of marinas would, in turn, attract
upmarket travellers visiting the region on their private yachts.
Luxury houseboats
Kerala has introduced the system of houseboats to harness the potential
of its backwaters. Unfortunately, quality houseboats are few and far
between.WTTC is aware that Indias finest houseboats, of every category,
are to be found on the Dal Lake in Kashmir. But, because of the poltical
problems in Kashmir, many of the houseboat builders and owners are out
of work, which causes enormous distress.
WTTC would therefore strongly recommend that the Government
of Kerala invite the houseboat builders/owners in Kashmir to create
similar houseboats and facilities in the backwaters of Kerala. In this way
two separate problems affecting tourism in different parts of the
country could be successfully addressed.
Water sports
WTTC has noted that facilities for water sports are relatively undeveloped
in Kerala. In order for the state to attract high-yield tourists to its beaches
and backwaters, private investment in water sports facilities should be
increased. What is needed is the full complement of facilities for every
type of water sports water-skiing, water scooters, para-sailing, airborne
sailing, marine fishing and scuba diving.These sporting facilities should be
listed as priority areas for investment by foreigners and Keralites alike.
22
Ayurveda
Reconstitute Keralas policy-making system
Ayurveda including massages and the use of medicinal herbs for
In order to make Travel & Tourism the states primary economic driver,
relaxation and rejuvenation purposes has already become a major
it is necessary for the Chief Minister to be associated with the planning,
attraction for tourists. The Kerala Government should ensure that all
execution and maintenance of tourism projects. This is because the
centres practising Ayurveda are authorized by the Department of
development of tourism infrastructure involves decisions affecting a
Tourism and Health to function as such centres. More health/wellness
variety of different disciplines such as public works, highways, power
holidays could be packaged around Ayurvedic treatment and special
and water systems, the constitution of development agencies, the
courses could be introduced to educate tourists about Ayurveda.
maintenance of law and order and security. Without the association of

the Chief Minister, decisions on a broad spectrum affecting tourism will
Keralas cuisine
not be taken.
Kerala boasts of some of the best seafood anywhere in the world the
WTTC strongly recommends that a Cabinet Committee on
Malabar prawn, for example, is a quality name signifying the wealth of
tourism be constituted under the chairmanship of the Chief Minister
the states seafood attraction. Unfortunately, most of the good quality
and, with other important ministers as members. The Ministry of
seafood is exported and not available to tourists in Kerala. It is
Tourism would service the Cabinet Committee, whose decisions would
recommended that special catering and culinary institutes be created to
be final and would determine the execution of policy in this vital sector.
develop Keralas cuisine. Steps should also be taken to ensure there is

sufficient seafood for consumption by local tourists. This would be an
added attraction for Kerala and would pay rich dividends for the future.
DEVELOP THE HUMAN CAPITAL

REQUIRED FOR GROWTH
Traditional festivals
The traditional Kerala festivals are colourful social events that reflect the
Place a high priority on education and

training
vibrant nature of the land and its people. Boat races in the backwaters
The vast increase forecast in the manpower requirements of the tourism
are majestic and the traditional art forms in the state are spectacular.
industry will necessitate the creation of suitable training facilities, which
Kerala also has a rich and singular cultural heritage. These festivals
could equip the workforce with the skills required to handle
should be seen as a high-priority attraction for marketing and
sophisticated foreign visitors. Special attention should be paid to placing
promotion.
education and training at the forefront of Travel & Tourism

development, introducing it into the school curriculum and having
mid-career refresher courses to constantly upgrade skills.
HIGHLIGHT THE STRATEGIC

IMPORTANCE OF TOURISM
Existing educational institutes, such as KITTS, KIHMS and

IHMCT, should be developed into institutions of excellence, and the
Recognize Travel & Tourisms impact across

the broader economy
syllabi and training facilities of other institutions offering courses in
In 2003, expenditure by national, state and local governments on
Continuous training programmes should also be organized to train the
Keralas Travel & Tourism will be around Rs1.4 billion (US$28.9
various categories of people engaged in the tourism industry, such as
million) a mere 1 per cent of total government expenditures. Over the
taxi drivers, cooks, waiters, guides, information office assistants, etc.
Travel & Tourism should be enhanced to ensure quality standards.
next decade, governments contribution to Travel & Tourism is expected

to grow by only 0.1 percentage point to just 1.1 per cent of total
expenditure. This unwillingness by government to invest adequately in
undermines Travel & Tourisms role as a catalyst for growth in other
ENCOURAGE OPEN MARKETS AND

SKIES AND REMOVE BARRIERS TO
GROWTH
areas such as retailing and construction, which would decline if demand
Improve airline access
for Travel & Tourism were reduced.
One major hurdle to the rapid growth of tourism to Kerala is access.
Travel & Tourism clearly reflects its lack of appreciation of the industrys
importance as a generator of wealth and employment. It also
WTTC recommends that the share of government expenditure in
The Government of India has a very restrictive air transport policy, and
Travel & Tourism be increased significantly over the next few years, so
existing bilateral air service agreements limit international flights to just
that it is more in line with the forecast contribution of Travel & Tourism
Thiruvananthapuram and Cochin, although a third airport at
to GDP and employment. The following shares highlight the greater
Kozhikode is also considered to be an international one. At these
importance attributed to Travel & Tourism in some other
airports, foreign airlines are also restricted in terms of seat capacity as
countries/states: Singapore, 9.1 per cent; Hong Kong, 7.4 per cent;
determined by the national carriers.
Malaysia, 5.1 per cent; Sri Lanka, 4.0 per cent; and China, 3.8 per cent.
As an example, Cochin airport has been in operation for four years

23
now, but services to the airport are severely limited to a handful of

foreign carriers. Emirates is one airline that has been unsuccessful in
obtaining rights for a daily service to Cochin. A much more liberal
approach is necessary to tap the full potential of these gateways to Kerala.
Keralas State Plan Allocation for tourism,

1995/96 to 2001/02a
Year
Allocation (Rs mnb)
% annual change
1995/96
173.0
na
1996/97
292.0
68.8
Tax intelligently
1997/98
360.0
23.3
One issue of considerable concern is that of tourism taxation.Travel &
1998/99
372.0
3.3
Tourism-related taxes in the state of Kerala (eg taxes on hotels, liquor,
1999/00
360.0
-1.2
2000/01
460.0
27.8
2001/02
400.0
-13.0
food and beverages) are higher than in any other state in India.
Tourism taxes in Kerala
a Fiscal years ended Mar 31
b Rs47.40 = US$1 as at May 1, 2003
Source: KTDC
Luxury tax
Room rate:
Non air-conditioned
Air-conditioned
Central Assistance Allocation for Keralas tourism,

1995/96 to 2001/02a
7.5%
15.0%
Allocation (Rs mnb)
% annual change
1995/96
21.0
na
9.2%
1996/97
23.6
12.4
100.0%
1997/98
27.7
17.4
10.0%
1998/99
69.9
152.3
1999/00
112.5
60.9
2000/01
122.5
8.9
2001/02
140.0
14.3
Year
Sales tax
Food
Imported liquor
Local liquor
Source: KTDC
The Kerala Government needs to recognize that air-conditioned

rooms and imported liquor are not considered by foreign tourists to be
a Fiscal years ended Mar 31
b Rs47.40 = US$1 as at May 1, 2003
Source: KTDC
luxury items. Many visitors look on these items as necessities and ones
that are readily available in their everyday lives at home. It is also worth
noting that the lowering of these tax rates can make a destination a more
Kerala needs to strengthen its overall infrastructure significantly
attractive option and, as a consequence, actually result in increased
not only in the interest of tourism, but also for the general economic
revenue collection due to an increase in demand and lower tax evasion.
development of the state. The inter-state highways, as well as roads

connecting tourism destinations, need to be upgraded to international
standards. Highways and roads have been developed all over the world by
MATCH PUBLIC AND PRIVATE

INFRASTRUCTURE TO CUSTOMER
DEMAND
private sector investors on a build, operate and transfer (BOT) basis, and
Increase government investment in Travel &

Tourism infrastructure
to airports and railway stations. This network of world-class highways
have been made economically viable through the introduction of toll

systems. Kerala needs to introduce toll roads to link tourism destinations
would allow Keralas numerous tourist attractions to be fully enjoyed.
It has already been established that the Kerala Government allocates a

mere 1 per cent of its budget to Travel & Tourism for expenditures
Channel private sector investment
related to the provision of individual and collective government services
Much of the wealth of Kerala comes by way of remittances from its
to visitors, travel companies and the community at large. This is
industrious workforce based in the Middle East and Southeast Asia.The
extremely low. But, in addition, the governments allocation for
Government of Kerala should try to channel the inward remittances to
investment in Travel & Tourism infrastructure, as detailed in the State
strengthen the Travel & Tourism infrastructure in the state. Special
Plan Allocation for tourism, is also low, as is the Central Assistance
schemes could be devised incorporating tax incentives and other
Allocation for Keralas tourism. Although there has been a substantial
assistance, whereby this money could become capital investment in
increase in percentage terms over the last few years, as the following
hotels, motels, restaurants, entertainment and tourism transport facilities.
tables show, the allocation for tourism has remained stagnant in terms of
its share in the overall budgets.
There is an urgent requirement for different kinds of tourism

transport luxury coaches, air-conditioned cars, luxury boats, yachts
Kerala would benefit enormously from a plan to progressively
and speedboats. A drastic lowering of import duty and other incentives
increase the states contribution. Such a plan could be implemented over
would help to divert money to the development of these productive
a five-year period, with the state allocation for Travel & Tourism
tourism assets.
gradually increasing to 5 per cent of the total budget.
24
FAVOUR TECHNOLOGICAL
ADVANCEMENT
E-marketing and distribution
PROMOTE RESPONSIBILITY IN
NATURAL, SOCIAL AND CULTURAL
ENVIRONMENTS
In todays increasingly competitive global marketplace, there is a real
Kerala has a fragile eco-system and its backwaters and coastal lagoons are
need for a strong leadership branding that optimizes resources, focuses
susceptible to pollution and overcrowding. In order to preserve its
the myriad of interests public and private sector, state and local and
precious tourist attractions, and ensure sustainable development in the
gets the attention of travellers.This will require particular attention to a
future, the Kerala Government should conduct carrying capacity
coordinated approach to internet marketing and distribution to
studies.
optimize Keralas visibility.
In addition, it should adopt the principles of ecological
The Government of Kerala has already taken important steps in
preservation as outlined in Agenda 21, developed for the Travel &
developing an attractive and useful website, and this should be expanded
Tourism Industry after the 1992 Rio Earth Summit by WTTC, the
and enhanced so it becomes a fully fledged regional tourism destination
World Tourism Organization and the Earth Council. WTTC also
database. This should be carried out with partners from the private
recommends that:
sector, so as to improve distribution of Keralas tourism products and
sustainable tourism expansion;
help small and medium-sized enterprises develop e-marketing skills.

Support for local companies should also be provided so that they
Clear policies and guidelines are developed for planned and
The socio-economic, cultural and environmental benefits of Travel
can develop access to technology advances and compete more
& Tourism are spread equitably across the population in all parts of
effectively with suppliers in competing destinations.
the state; and
The need for local community engagement and empowerment is

recognized.
Sustainability will need a balance of private initiative, economic
instrument and regulation. Global principles should be reflected in local

action and market-based delivery mechanisms should be encouraged.
Micro-loans for local community-based sustainable tourism enterprises
should be provided as incentives, and pilot projects used to evaluate and
demonstrate local sustainability.
One major hurdle to the rapid growth of

tourism to Kerala is access.
Increase branding through international

and/or national designations
Kerala is immensely rich in its unique art forms, culture and heritage.
The tradition of classical and folk arts in Kerala dates back over a
thousand years. Koodiyattom, one of the oldest art forms of Kerala, and
the only surviving form of the ancient Sanskrit drama, was recently
selected by UNESCO for proclamation as an oral and intangible world
heritage.
Kathakali, Mohiniyattam, Thullal, Theyyam, Thira, etc are unique
in their style and forms and the architectural monuments in the state
maintain a unique character. The state has also decided to hasten the
process for the preservation and conservation of these heritages. But it
could also consider developing and promoting a regional heritage
designation, with clearly defined criteria defined to support quality.
Such a designation should result in increased funding from the
government for the development and promotion of identified areas of
particular heritage value.
25
SATELLITE ACCOUNT
1998
1999
2000
2001
2002E
2003E
2013P
Kerala Travel & Tourism - Rs bn

Business Travel & Tourism
Corporate
Government
Govt Expenditures - Individual
Visitor Exports
19.08
2.88
2.59
0.29
0.22
17.63
22.71
3.40
3.04
0.37
0.27
20.41
26.22
3.77
3.36
0.41
0.31
23.27
28.64
3.47
3.09
0.38
0.34
25.50
32.00
3.27
2.90
0.36
0.37
28.64
37.61
4.07
3.62
0.44
0.42
35.24
195.67
19.10
17.43
1.67
1.34
239.07
39.82
46.80
53.57
57.95
64.28
77.33
455.17
Govt Expenditures - Collective

Capital Investment
Exports (Non-Visitor)
0.50
10.02
2.98
0.63
11.64
3.51
0.70
13.04
4.11
0.78
14.20
4.60
0.86
15.88
4.95
0.95
18.14
5.81
3.07
75.13
30.56
53.31
62.58
71.42
77.53
85.97
102.23
563.94
210.94
24.68
241.54
27.31
290.20
29.49
328.82
32.79
378.58
39.27
1,135.66
216.52
Travel & Tourism Economy Aggregates (Direct and Indirect Impact)

Employment ('000)
570.82
441.41
Gross Domestic Product
43.76
51.65
506.21
57.24
611.28
62.11
692.98
69.11
788.55
81.80
2,221.37
423.52
4.95
1.01
7.72
15.63
7.76
5.16
1.01
7.74
15.48
8.41
5.21
1.01
7.75
15.27
8.59
5.27
1.02
7.78
15.83
8.71
5.41
1.03
7.82
16.62
8.97
7.16
1.10
8.27
22.42
11.59
2.35
3.48
2.45
3.47
2.56
3.48
2.70
3.52
2.98
3.71
7.68
5.23

Employment
4.68
4.91
7.24
7.28
5.13
7.28
5.38
7.33
5.68
7.41
6.20
7.73
15.02
10.24
5.92
-10.72
6.37
-10.44
10.86
17.44
10.80
9.74
7.30
5.61
6.27
8.51
4.91
5.27
5.27
6.49
6.97
2.48
5.62
5.59
4.81
7.74
16.05
10.78
13.47
12.17
5.62
6.66
13.78
9.14
12.18
11.45
Travel & Tourism Industry Aggregates (Direct Impact Only)

Employment ('000)
272.71
20.90
Note: Employment in 000 Jobs
T&T Accounts as % of National Accounts

Govt Expenditures
Capital Investment
Exports
T&T Imports
4.87
0.99
7.69
16.28
7.54

Employment
2.23
3.46
Travel & Tourism Real Growth (% per annum, except 2013 = 10-year annualized)
12.97
13.33
11.00
8.31
12.46
6.50
Govt Expenditures
Capital Investment
Visitor Exports
Other Exports
26
15.06
1.65
15.26
-3.09
13.63
10.14
20.83
10.64
10.22
12.17
11.93
11.79
7.09
7.69
9.56
12.59
10.02
9.70
TABLES
1998
11.58
Employment
13.88
1999
2000
2001
2002E
2003E
2013P
12.44
-22.65
6.35
14.51
4.70
20.14
5.91
13.31
12.96
15.13
11.44
11.61

8.50
12.41
Employment
10.73
-22.67
6.51
14.68
5.23
20.76
5.96
13.36
11.64
13.79
10.75
10.91
Kerala Travel & Tourism - US$ mn

Corporate
Government
Visitor Exports
462.48
69.87
62.81
7.07
5.24
427.42
527.44
79.07
70.55
8.52
6.37
474.09
583.54
83.93
74.81
9.12
6.80
517.69
606.95
73.59
65.46
8.13
7.17
540.26
659.94
67.37
59.88
7.49
7.71
590.74
757.60
81.92
72.96
8.96
8.37
709.86
2,610.78
254.81
232.53
22.28
17.87
3,189.74
965.01
1,086.98
1,191.96
1,227.96
1,325.76
1,557.76
6,073.20

Capital Investment
12.02
242.83
72.16
14.62
270.37
81.45
15.60
290.20
91.41
16.44
300.98
97.41
17.69
327.62
102.04
19.20
365.52
117.06
40.98
1,002.46
407.77
1,292.03
1,453.42
1,589.17
1,642.78
1,773.11
2,059.54
7,524.41

Employment ('000)
272.71
506.67
210.94
241.54
290.20
328.82
378.58
1,135.66
573.28
607.69
624.80
676.37
791.11
2,888.93
Travel & Tourism Economy Aggregates (Direct and Indirect Impacts)

Employment ('000)
570.82
441.41
1,060.50
1,199.64
506.21
1,273.56
611.28
1,316.09
692.98
1,425.41
788.55
1,647.81
2,221.37
5,650.81
Travel & Tourism - 1990 Constant US$ mn

537.11
81.15
6.09
Visitor Exports
496.38
1,120.72
13.96
Capital Investment
282.01
83.80
1,500.49
608.70
91.26
7.35
547.13
1,254.44
16.87
312.03
94.00
1,677.34
675.67
97.19
7.88
599.42
1,380.14
18.07
336.01
105.84
1,840.07
715.65
86.76
8.45
637.01
1,447.87
19.38
354.88
114.85
1,936.98
761.25
77.71
8.90
681.43
1,529.28
20.41
377.92
117.71
2,045.31
843.95
91.26
9.32
790.77
1,735.30
21.39
407.18
130.40
2,294.27
2,353.12
229.66
16.10
2,874.94
5,473.82
36.94
903.52
367.53
6,781.80

Travel & Tourism Industry
Travel & Tourism Economy
661.60
1,384.46
703.63
1,474.63
736.69
1,551.78
780.20
1,644.23
881.28
1,835.61
2,603.81
5,093.12
588.42
1,231.62
27
WTTC India Initiative Members

Vikram Madhok*
Abercrombie & Kent
P R S Oberoi*
The Oberoi Group
Ankur Bhatia*
Amadeus India Pvt Ltd
Hugh Hamilton-Andrews
PFG Nomura
K L Muralidhara*
American Express
Priya Paul
The Park Hotels
Harsh Neotia
Ambuja Cement Eastern Ltd
Utam Kumar Bose

Sahara Airlines India
Shiv Kumar Jatia

Asian Hotels Ltd
Arjun Sharma
Select Holiday Resorts
K Roy Paul
Air India
Himmat Anand
Sita World Travel
Alun Cathcart*
Avis Europe Plc
Daniel Desbaillets*
Six Continents Hotels
Lalit Suri*
Bharat Hotels Ltd
R K Krishna Kumar*
The Taj Group
Peter Kerkar
Cox & Kings
Ashwini Kakkar*
Thomas Cook (India) Ltd
Maurice Flanagan*
Emirates
Adi J Katgara
Travel Corporation India Pvt Ltd
Maharana Arvind Singh

Historic Resort Hotels Ltd
Yogesh Chandra
Secretary General,WTTC India Initiative
Vivek Nair
Hotel Leelaventure Ltd
Ritu Chatrath
Executive Assistant,WTTC India Initiative
Sunil Arora
Indian Airlines
Marianne Thompson-Hill
Director, Regional Programmes,WTTC
Nakul Anand
ITC Hotels
WTTC India
D-56 Malcha Marg
Chanakyapuri
New Delhi 110021
India
Tel: +91 (11) 2410 9745
Fax: +91 (11) 2410 8464
Email: rchatrath.wttc@starith.net
Naresh Goyal
Jet Airways
HH Maharaja Gaj Singh
Maharaja Heritage Resorts
*Members whose companies are also Global Members of the WTTC

Tourism Industry in Kerala

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Tourism Industry in Kerala

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KERALA

THE IMPACT OF TRAVEL &TOURISM

Manuel Fernando Esprito Santo

Henri Giscard dEstaing

Jean Gabriel Prs

Marilyn Carlson Nelson

Jos Antonio Tazn

2003 WORLD TRAVEL & TOURISM COUNCIL

THE WORLD TRAVEL & TOURISM COUNCIL (WTTC) IS THE BUSINESS

The message from this report is surprisingly positive. Travel &

to produce this report the first simulated Tourism Satellite Account

Tourism is already one of the highest priority industries and employers

for the Kerala Government. Demand growth in Kerala is the highest in

governments in the world to quantify the far-reaching contribution of

Travel & Tourism to economic growth and employment thanks to the

the coming decade.

implementation of this new accounting concept, approved by the United

However, in order to manage the projected demand, WTTCs

This report estimates the current performance of Keralas Travel &

such as tourism policy planning, investment incentives, infrastructure

development, and marketing and promotion. In addition, sustainable

international data fed into econometric models developed by WTTCs

tourism development will depend on preservation and maintenance of

research partner, Oxford Economic Forecasting. It quantifies all aspects of

Travel & Tourism demand, from personal consumption to business

huge manpower required to adapt to the growth in demand.

purchases, capital investment, government spending and exports. It then

We hope that, by raising awareness of the enormous potential of

translates this information into economic concepts of production, such as

industry and government to work together to create the conditions

industries and the economy as a whole to provide credible statistical

necessary to realize this potential.

information that will assist in policy and business decision processes.

President,World Travel & Tourism Council

Secretary General,WTTC India Initiative

ECONOMIC IMPACT _________________________________________________________________________________________ 6

KERALAS TRAVEL & TOURISM

TRAVEL & TOURISM SATELLITE ACCOUNT

THE POLICY FRAMEWORK

Use of material is authorized, provided the source is acknowledged

economic and social development across the whole of

(TSA) for Kerala was taken in June 2001 in an attempt

to explore the true potential of Keralas tourism product.

If managed effectively, Travel & Tourism can be an

The TSA research was conducted in December 2001

important catalyst for the development of other

and was based on data collected in the state at that time.

Kerala became WTTCs first partner state in India

manufacturing, construction and the service industries.

in 2000. In a communication to A K Antony, Chief

It can also help to protect Keralas primary assets, namely

Minister of Kerala, Jean-Claude Baumgarten, President

its largely unspoilt natural and cultural environment.The

government has already taken steps to establish a

We recognize that Kerala has tremendous potential for

working partnership with the private sector. This will

Travel & Tourism.This partnership is designed to initiate and

facilitate harmonization of the two sectors development

strengthen a cohesive set of strategic policies to champion the

targets so that they remain complementary.

interest of Indias strongest economic growth sector and creator

Keralas Travel & Tourism directly contributes 3.7

of employment We look forward to actively working with

you to strengthen tourism in your beautiful state and to make