Accommodation concerns for India as tourist influx increase By Dr Suvrokamal Dutta

In coming years, hotel facilities in India will be inadequate to cater to the demand surge arising because of increased tourist influx. Rise of the India Inc, booming IT and BPO sectors, state-of-the-art yet affordable medical facilities, dip in air fares and significant steps taken by the Indian tourism industry are some of the reasons, which has contributed heavily in an increase in the number of tourists in the country.

In addition, business trips and leisure travel by the people too have given a boost to India’s hotel industry putting in on a growth path. According to one estimate, foreign arrivals in India are increased by 11 percent between 2004 and 2005 and by 15 percent between 2005 and 2006. If experts are to be believed, more than 50 percent of this number are foreign business travellers, besides this around 300 million domestic travellers traverse the country and this number is expected to witness a growth of 10-15 percent over the next two years. This tremendous growth of travellers means there is a need of around 1,00,000 new hotel rooms in the country but it has come into the notice of The India Street that only 75 percent of which will be met by the projects that are presently underway. In my opinion, the current availability of 1,10,000 hotel rooms across all categories in India is quite low as compared to other countries in the world. For example, China has ten times more and the United States has forty times more hotel rooms. This gap pretty much indicates that the Indian hotel sector has not been able to keep pace with the economic growth leading to a gap in the demand and supply of quality hotel

rooms. Delhi, being the hub of most modern medical facilities in the country, the coming days would see a rise in the number of medical tourists in the capital. The upcoming Commonwealth Games scheduled to be held in 2010 would further lead to an inflow of around 0.8 million international tourists and 3.6 million domestic tourists. To accommodate these visitors around 30,000 rooms will be required in 2010. Taking this into consideration, around 25 hotel projects are coming up in Gurgaon and Noida is having 24 projects on the anvil. There is no doubt in my mind that in the coming years, supply of hotel rooms in NCR region will be in the excess of 17,500. Of these around 5100 are currently under construction and the rest in planning stages at various locations around the region. Thanks to favorable government policies, the advent of Metro Rail and improving infrastructure, the movement of tourists in India is going to improve and the arrival of international players in the sector would take the hotel industry towards global standards.