Impact Analysis Of COVID-19 In India: Losses In Tourism Industry To Increase

The coronavirus outbreak has disrupted the global community in a time frame of only three months. What started in the Hubei province of China has spread to 109 countries causing over 3,000 deaths. As of March 9th, the total number of infections across the world has crossed one lakh. A sense of panic has spread among citizens in different countries. People have begun to hoard food items and medical supplies in anticipation of a possible quarantine-like situation. Countries have cordoned off entire cities all in the hope of containing the virus. 

Also Read: India Suspends Visa On Arrival Facilities For South Korea And Japan Due To Coronavirus

The travel and tourism industry has been particularly affected as blanket travel bans have been imposed in countries throughout the world. People are being restricted from travelling to the most affected countries like China, Italy, South Korean and Iran. Such large-scale measures are bound to have an impact on the economy and negatively impact the travel and tourism industry. 

In India, the number of positive cases have shot up to 43. While no deaths have been recorded so far, the government is taking stringent measures to keep the spread of the virus in check. Thousands of flights have been canceled, foreign ships are being denied entry into Indian ports and people are being consistently advised to maintain high standards of hygiene.

The impact of COVID-19 on tourism in India

Since China was the site of the origin of the virus, countries across the world set up measures to prevent the entry of Chinese tourists and visitors. Owing to China’s huge population, they contribute significantly to tourism in different parts of the world. Though Chinese tourists in India constitute only 3% of the total inbound tourists, they were among the top 10 spenders by nationality last year.

Due to the coronavirus, India may lose tourists not just from China, but other East Asian regions also such as Korea, Taiwan, Hongkong, Singapore, etc. This will directly impact the tourism sector’s revenue. Aside from Chinese tourists, other tourists from around the world have also stopped travelling in the fear of contracting the virus. Travel plans are being rescheduled across the world causing huge losses to the airline and hospitality sector. Local Indian travel operators will bear severe losses due to these sudden cancellations. 

India annually earns nearly $30 billion from foreign tourist arrivals. This figure is projected to decline significantly. Outbound tourists are also reducing their travel, especially after the outbreak of the virus in the cruise liner in Japan.

The aviation industry is struggling to cope with the outbreak

The International Air Transport Association (IATA) announced that its initial assessment of the impact of the Novel Coronavirus 2019 outbreak (COVID-19) shows a potential 13% full-year loss of passenger demand for carriers in the Asia-Pacific region. In this scenario, that would translate into a $27.8 billion revenue loss in 2020 for carriers in the Asia-Pacific region—the bulk of which would be borne by carriers registered in China, with $12.8 billion lost in the China domestic market alone. The severity of the coronavirus indicates that the aviation industry will take a much longer time to recover from revenue losses. 

Also Read: IATA Assessment Shows $27.8 Billion Revenue Loss In Asia-Pacific Region Due To Coronavirus

Research shows that the number of Chinese tourists visiting India in 2020 would have been around 5 lakhs contributing US $68 billion, which is now unlikely to be achieved.

Other expected losses in the industry due to COVID-19

In India, major losses will be recorded due to the decrease in foreign inbound leisure tourists, business travelers, MICE travelers, wedding guests from USA, UK, France, Germany and even from the Middle East. If travel advisories are issued against travel to South Asia in the future, losses will only increase.

india coronavirus, covid-19

Further, the constantly growing India outbound market totaled 2 million in 2019 will now plummet as international visits are being cancelled. 

There is still a lot of uncertainty surrounding a possible cure of the coronavirus and how it can be contained. Until this happens, the global community will most likely keep their restrictions and bans in place. The long-term losses associated with COVID-19 are going to send ripples across the world. 



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