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Gunn (1988) denotes the tourism product as a complex consumptive
experience that results from a process where tourists use multiple of






accommodation, and attraction services) during the course of their

visit. Other economic and political conditions and structural features
are also important factor shaping many tourist experiences and
contribute to the nature of the destination product. Murphy et al
(2000) related this type of product to a supply and demand analysis
and described how various components of the destination interact
with travelers during their trip.
Smith (1994) was among the first to acknowledge the role of service
infrastructure in creating a product experience. He argued that








environment or physical plant of the destination (Smith, 1994:pp 54).

He stressed the fact that the level, use, or lack of infrastructure and
technology in a destination (for example transportation, water and
power supply, use of computer technology and communications


among others) are also visible and determining features that can
enhanced the visitors' trip experience. Other authors subsequently
supported his views (Choy 1992; Buharis 2000; Crouch and Ritchie
2000). They posited that tourists overall impression develops their
image of a destination after their visitation and that infrastructure
may play an important role in that respect.
Crouch and Ritchie (2000) interestingly summarised (Figure 1) the
various factors that together make a tourist destination experience
attractive. They highlighted the importance the service infrastructure
layer, which includes transport services, in the tourist destination


Figure 1: The Tourist Destination Experience

Source: Crouch and Ritchie (2000)
The tourist destination product is also better understood in the
context of comparative and competitive advantage. Figure 2, which is
adapted from earlier work of Crouch and Ritchie (1999), depicts a
global picture of the determinants of a destinations competitiveness.
The authors argued that factor conditions are important determinants
of attractiveness as tourists travel to a destination to receive the
destination experience. Every element has been categorised under
core attraction and supporting elements. We focus on the supporting







infrastructure services in this category in fact represent one of the

most important factors. The tourism phenomenon relies heavily on
public utilities and infrastructural support. Tourism planning and
development would not be possible without roads, airports, harbors,
electricity, sewage, and potable water. The infrastructural dimension
is thus a necessary element for tourism development and the above
factors are all basic elements for attracting visitors to a destination.
Generally, infrastructure has not been included in empirical works


because it is expected to be available at a destination and has not

been promoted as an attraction factor. Smith (1994), and Crouch and
Ritchie (1999) provide a good theoretical treatment of the role of
service infrastructure in creating a tourism product experience

Figure 2: Destination Competitiveness and Sustainability

Source: Adapted from Crouch & Ritchie


Kaul (1985) also recognizes the importance of infrastructure, more

specifically transport as an essential component of successful tourism
development in that it induces the creation of new attractions and the
growth of existing ones. The Tourism Task Force (2003) of Australia
asserts that infrastructure is a big part of the tourist equation. For
instance it is posited that the transport system is responsible for
connecting tourism-generating regions to tourism-destination regions
as well as providing transport within the tourism destination. It
should be easy to get to and around in tourism destinations.
(Prideaux 2000). Inhabitants of developed countries, from where the
majority of tourists originate, are used to modern transport
infrastructure that enables high quality service. These tourists prefer
to maintain essentially the same comforts as at home while traveling
(Cohen, 1979; Mo, Howard and Havitz, 1993). In fact, Mo, Howard
and Havitz (1993), using survey methodology, find that tourists
prefer to travel to countries that have the same infrastructures as in
their home country. Prideaux (2000) argued that if the ability of
tourists to travel to preferred destinations is inhibited by
inefficiencies in the transport system such as uncompetitive prices or


lengthy and uncomfortable journey, the likelihood that they will seek
alternative destinations may increase. Tourism resorts have also often
been cited as an important attractor of tourism, especially for the
high-class segment. Prideaux (2000) posited that a critical mass of
public infrastructure (including transport) is essential for enabling
the establishment of high-quality resorts in a country. If this critical
mass is not available, the operators would have to incur these
infrastructure costs, thereby adding to the capital and operating costs
of tourism development and thus reducing competitiveness. [1]
Let us discuss an example of Chinese tourists who have high
expectations with respect to infrastructure while travelling:
Expectations of Chinese Tourists
Chinese visitors have certain expectations when travelling with
respect to the following aspects of infrastructure
Chinese tourists tend to choose hotels based on location,
cleanliness, safety and security and value-for-money. They
expect functional, quality and family-friendly rooms with


complete facilities and prompt service. Hotels should have

available, or on request:
1. Kettles
2. Chinese or herbal tea sachets
3. Toothbrush and toothpaste
4. Disposable slippers
5. Disposable razors and shaving cream
6. Minibar cup noodles with disposable chopsticks
7. Cable / satellite Chinese TV channels
Food and Restaurants
Chinese cuisine is world famous and most Chinese tourists do
not easily adjust to other cuisine when travelling. Hence,
Chinese food should be provided throughout the trip. If lunch
is Western style, then dinner should be Chinese or at least
Asian style. The Chinese normally expect food to be served
quickly and a typical meal would last less than an hour.
In Western Australia, Chinese tourists often like to sample local
food such as seafood (including fresh oysters), kangaroo meat,
vegetables, fruit and other popular dishes.


The Chinese usually eat warm food and are not used to salads
and cold dishes. Typical breakfast includes rice porridge with
pickles, noodle soup and Chinese dim sum. Hot soup and hot
tea must be provided in cooler months during meals. For
packed lunches, it is advisable to prepare some instant cup
noodles for those who prefer a hot lunch over sandwiches or
similar. Always offer hot or warm water instead of iced water
to the Chinese.
To create a feeling of being welcomed, the menu should be
translated into Chinese.
Tour Guides and Itineraries
It is quite common for a Chinese travelling group to decide
their itinerary close to departure. Even during the trip, they
may try to change or rearrange the itinerary, so you need to be
prepared to be flexible and accommodate their requests. Free
time for shopping must also be included in the itinerary. Please
read the shopping section below for some tips.
Western Australia is an extraordinary State and is popular
among the Chinese tourists for its:



Clear blue sky and clean air


Pristine beaches along the Indian Ocean


Flora and fauna


Same time zone as China


Close proximity to Asia


Fresh seafood, fresh local produce and premium wines


Diverse landscape


Natural wonders, including the Pinnacles, Wave Rock,

Ningaloo Reef etc.


Relaxed lifestyle and spaciousness

Locals - Western Australians are known to be easy-going,
friendly and warm

Chinese visitors often join a tour group because they believe

that they would experience fewer cultural and language
barriers. They rely heavily on their tour leader and local
Mandarin-speaking guide. They expect local tour guides to be






history. Chinese visitors perceive group tour packages to be

reasonably priced compared to travelling on their own. In fact,


they generally prefer tour packages involving multiple

destinations for better value for money.
Entertainment and Activities
The majority of Chinese visitors are interested in the history
and culture of Australia, including our Indigenous heritage.
They are keen to learn about our lifestyle, educational system,



and nightlife.

They seek

extraordinary experiences and knowledge from overseas as




as a

way of



horizons. Chinese visitors should be engaged in a range of

different activities where possible. Some of these activities



shipping, crabbing,


swimming with whale sharks and dolphins and watching a

sunset on the Indian Ocean.
Their intention is also to share their experiences with their
family and friends once they return home.
Most Chinese tourists are photography enthusiasts. Always






taking photos,

especially in front of prestigious sites as this will enhance the

overall satisfaction of the visit.
Chinese tourists are passionate about shopping. Most of them
have done their research online for popular Western Australian
products to buy during their trip. Some of these products
include lanolin cream, emu oil, fish oil and vitamin
supplements, formula baby milk powder, UGG boots, canned
abalone and organic skin care products. For high-end Chinese
travellers, they may spend time shopping for Argyle diamonds,
pearls and gold.
Chinese visitors normally purchase large quantities of a certain
product as gifts for their friends and family. Always include
shopping excursions and a brief stop to a local supermarket in
the itineraries, even with a tight schedule.
Chinese visitors expect their travelling coach to be safe, clean,
and spacious and equipped with proper air-conditioning.
However, the temperature in the coach must not be too cold.


They would normally sleep on long bus rides and a stop will be
required every one to two hours for a washroom and smoking
When Chinese visitors are abroad, keeping in touch with
family and friends is very important. Hence, convenient
communication options such as mobile wi-fi access and inroom internet connection are highly appreciated. As there is no
time difference between China and Western Australia, they are
likely to send the photos taken during the trip to their family or
load them onto social media websites to share with their
Service Expectations
Chinese visitors desire genuine respect, hospitality and a good
understanding of Chinese culture from service providers.
Chinese tourists appreciate a high level of enthusiasm, a
positive attitude and having mandarin-speaking staff. It is
advisable to put in place a service recovery plan to handle their
complaints. [3]


Since Infrastructure plays a very important role in the tourism

industry and attracts tourists, various infrastructure schemes
have been introduced.
Infrastructure development schemes
Since most infrastructure elements and the delivery systems are
within the purview of the state Governments or private sector,
tourism infrastructure is being developed mainly with financial
assistance to state/U.T. governments and by providing various
incentives to private entrepreneurs.
Specific schemes for which financial assistance is provided to
the States include the following:
(a) Construction Schemes
Forest Lodges
Tented Accommodation
Tourist Complexes/ Tourist Lodges
Wayside Amenities
Motels/ Cafeterias/ Restaurants
Tourist Reception Centres
Pilgrim Sheds/ dormitories, etc. at pilgrimage centres


Public conveniences
(b) Tourist Transport
Mini-buses, jeeps, elephants, etc. for wild life viewing
Cruise Boats, ferry launchers, etc. for water transport
Tourist Coaches in selected circuits
Special Tourist trains
The most frequent pattern of funding which has continued over
successive plan periods is known as "normal funding". Under this
pattern, the Central Department of Tourism meets almost the entire
expenditure, except the cost of land and interior decoration in the
case of construction projects.
A new method of funding by way of grant-in-aid towards project cost
was introduced during 1992-1993. In this scheme, 28 per cent of the
project cost is provided by the central government and 12 per cent is
provided by the state government. The balance of 60 per cent has to
be raised as a loan from financial institutions or banks. This method
of funding is applicable to projects requiring large investments. It is
expected that the state governments would be able to mobilize more


resources from financial institutions for investment in tourism

projects through this method. [4]

India's rich cultural heritage and history, food, friendly people,
architectural monuments, hospitality and services are positive
strengths for its tourism sector, which make it ahead of many of the
emerging markets.
Today, tourism is the most vibrant tertiary sectors and has a strong
hold on the economy. The sector contributes 6.23 per cent to the
national gross domestic product (GDP) and 8.78 per cent of the total
employment in India. Moreover, India stands 42nd in the world
rankings in terms of foreign tourist arrivals (FTAs) in the country,
according to a report titled 'Competitiveness of Tourism Sector in
India with Selected Other Countries of the World' by Ministry of
Tourism. The World Travel and Tourism Council (WTTC) named
India as one of the fastest growing tourism industries for the next 10
to 15 years.
In addition, India has also developed as one of the world's most costefficient medical tourism destinations, and is anticipated that the


Indian medical tourism market will register a compound annual

growth rate (CAGR) of 27 per cent during 2011-15, as per a RNCOS
report titled 'Booming Medical Tourism in India'.
"India is an extremely important market for IHG, one that we are
always looking for the right opportunities to invest in. With
international tourism increasing year-on-year and the continued
strength of domestic tourism, we see incredible opportunities for
growth," said Mr Jan Smits, Chief Executive Officer, InterContinental
Hotels Group (IHG) in Asia, Middle East and Africa, who took part
in a trade mission to India with Mr David Cameron, the British Prime
Minister, to boost trade ties between the two countries. [5]
India has the potential to become the number one tourist destination
in the world with the demand growing at 10.1 per cent per annum,
the World Travel and Tourism Council (WTTC) has predicted.
The WTO (World Travel Organisation) predicts that India will
receive 25 million tourists by year 2015.
Major attractions in India are the world's highest mountains, miles of
coastline with excellent beaches, tropical forests and wildlife, desert


safari, lagoon backwaters, ancient monuments, forts and palaces,

adventure tourism and, of course, the Taj Mahal.
India currently has over 200,000 hotel rooms spread across hotel
categories and guest-houses and is still facing a shortfall of over
100,000 rooms (source: FHRAI).
The country is witnessing an unprecedented growth in hotel
constructions and will be adding almost 114,000 hotel guest rooms to









The earlier setbacks in global tourism have strengthened the

Department of Tourism's resolve to promote India's tourism through
aggressive marketing strategies through its campaign 'Incredible
The 'marketing mantra' for the Department of Tourism is to position
India as a global brand to take advantage of the burgeoning global
travel and trade and the vast untapped potential of India as a
destination. [6]

Number of hotels and restaurants in India

Hotel category

No. of Hotels


No. of Rooms

5 star deluxe/5 star


43, 965

4 Star


20, 770

3 Star



2 Star



1 Star













Market Size
The amount of foreign direct investments (FDI) inflow into the hotel
and tourism sector during April 2000 to January 2013 was worth US$
6,561.78 million, as per data provided by Department of Industrial
Policy and Promotion (DIPP), Ministry of Commerce.
FTAs have shown a growth of 2.8 per cent in March 2013 over March
2012 while the growth rate in Foreign Exchange Earnings (FEEs) from
tourism stood at 21 per cent over the same period in rupee terms.


FTA during March 2013 was recorded at 640,000 as compared to

623,000 during the month of March 2012.
The Visa on Arrival (VoA) Scheme of the Government of India has
registered a growth of 54.6 per cent in February 2013. A total number
of 1,947 VoAs were issued last month as compared to 1,259 VoAs
issued in February 2012.
Major Developments & Investments
India is among the top five tourism source markets for South
Africa. The country has received 79,306 Indian tourists during
January-September 2012, according to the data released by
South African Tourism
Mumbai is among the 10 most affordable destinations in the
world, according to a cost comparison study done by
TripAdvisor on common incidental items and services that
travellers purchase while staying at a hotel
The International Tourism Mart organised by the Ministry of
Tourism was inaugurated at Guwahati by Mr Janaki Ballav
Patnaik, Governor of Assam. It is the first international tourism
event to be organised in the North Eastern region of India


India and Canada plan to strengthen cooperation in tourism

sector. Both the countries will identify areas for working
together and explore new opportunities in tourism sector
India and Japan plan to strengthen cooperation in tourism
sector. Both the countries will identify areas for working
together and explore new opportunities in tourism sector
especially in the field of human resource development and
investment in the tourism sector
Egypt has initiated talks with the Tata Group to set up a hotel
chain in the African country
Inter-Continental Hotels Group (IHG) has signed 13 new hotels
in India in 2012, boosting its existing pipeline of hotels in the
country to 47
Marriott International plans to open 52 more properties in
India over a period of four years
Tourism Corporation of Gujarat Ltd (TCGL) and Indian Oil
Corporation Ltd (IOCL) have signed a memorandum of
understanding (MoU) to help promote tourism in the State by
offering facilities to tourists at IOCL petrol pumps.


Government Initiatives
The Ministry of Tourism, Government of India, has consistently been
working on improving India as a prime destination for tourists. It
further aims at promoting various Indian tourism products vis--vis
competition faced from various destinations and to increase India's
share of the global tourism market.
The Government of India allows 100 per cent foreign direct
investment (FDI) in the hotel sector on automated basis.
The allocation for Ministry of Tourism in the Union Budget 2013-14
has been increased by Rs 87.66 crore (US$ 16.03 million) to Rs
1,297.66 crore (US$ 237.23 million).
Moreover, the Indian companies in the hotel sector, with a total
project cost of Rs 250 crore (US$ 45.70 million) or more, irrespective
of their geographical location, have been allowed to tap the external
commercial borrowing (ECB) route. The maximum ECB by an
individual company or group, as a whole, has been restricted to US$
3 billion.
The fourth meeting of ASEAN and India Tourism Ministers was held
in Vientiane, Lao People's Democratic Republic (PDR). A protocol to


amend the memorandum of understanding (MoU) between ASEAN

and India to strengthen tourism cooperation was also signed.
Mr Chiranjeevi, Union Minister for Tourism, Government of India,
has complimented the Government of Madhya Pradesh for becoming
the first State in the country to fully utilise plan funds released to
them by the Ministry of Tourism, Government of India for the
development of tourism infrastructure at various tourist sites in the
In a bid to give a boost to tourism in Uttarakhand, the State
Government has identified 21 places endowed with natural beauty to
develop them into major tourist destinations.
The Ministry of Tourism has also sanctioned central finance
assistance (CFA) worth Rs 43.87 crore (US$ 8.02 million) for the
development of Solapur mega circuit in Maharashtra.
Road Ahead
The tourism sector can also be considered as the backbone for allied
sectors, like hospitality, civil aviation, and transport. Domestic
tourism is very huge in the country, promoted by various intents.
Pilgrim and leisure tourism are two very important sectors.


The Ministry of Tourism has also played an important role in the

development of the industry, initiating advertising campaigns such
as the 'Incredible India' campaign, which promoted India's culture
and tourist attractions in a fresh and memorable way. The industry
has been witnessing an upswing for last few years partially due to an
excellent 'Incredible India' campaign and is expected to increase up to
US$ 431.7 billion by the end of 2020.

On the other front, India has the potential to develop the rural
tourism industry. This can benefit the local community economically
and socially, and enable interaction between tourists and locals for a
mutually enriching experience. [7]

Exchange Rate Used: INR 1 = 0.01828 as on April 12, 2013




Seetanah B, Juwaheer T D, Lamport M.J., Rojid S, Sannassee

R V, Subadar Agathee U, (2011). Does Infrastructure
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Mauritius Research Journal.


CANNING, D. AND PEDRONI, P. 1999 Infrastructure and

long run economic Growth. CAER II Discussion Paper No.


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Infrastructure in India, Point M.4, Page 107, Available at:



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Investment and Trade Promotion (ITP) Division, Available


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Report by India Brand Equity Foundation, (Updated April,











Reports of RNCOS Report, Media Reports, Ministry of

Tourism, Press Releases, Department of Industrial Policy
and Promotion (DIPP)