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Growth Of Hospitality Industry In India Tourism Essay

Paper Type: Free Essay Subject: Tourism
Wordcount: 3910 words Published: 12th May 2017

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Introduction to Travel and Tourism

Tourism is travel for leisure, recreational and business purpose. Tourists can be defined as people who travel to and stay in places outside their usual surroundings for more than twenty-four hours and not more than one consecutive year for leisure, business and other purposes by the World Tourism Organization. Tourism is a known affair in human life. It has been an industry of vast dimensions and eventually supports economic and social growth. Tourism worldwide has experienced phenomenal growth. With more than 600 million people travelling annually, tourism is the world’s largest industry, with revenues of about half a trillion dollars a year, and averaging five percent annual growth.

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India, being a vast and diverse country has always something to offer, and its glorious traditions and rich cultural heritage are linked with the development of tourism. Its magnificent monuments attract large numbers of visitors from all over the world. Tourism is the largest service industry in India, with a contribution of 5.68% of the national GDP and 8.78% of the total employment in India. India witnesses’ more than 13.72 million annual foreign tourist arrivals and 650 million domestic tourist visits. The tourism industry in India generated about US$ 100 billion in 2008 and is expected to increase to US$ 275.5 billion 2018 at a 9.4% annual growth rate.

Booming IT industry and outsourcing industry has led to growing number of business trips made by foreigners to India, who often add a weekend break or longer holiday to their trip. Foreign tourist spends more in India than almost any other country worldwide. Tourist arrivals are projected to increase by over 22% per year through till 2010. Tourism minister 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. This campaign helped create a colourful image of India in the minds of tourists all over the world and directly led to an increase in the interest among tourists.

The tourism industry has helped growth in other sectors as diverse as horticulture, handicraft, agriculture, construction and even poultry.

Both directly and indirectly, increased tourism in India has created jobs in a variety of related sectors. Almost 20 million people are now working in the India’s tourism industry.

Growth Of Hospitality Industry In India

The hotel industry in India is going through an interesting phase. One of the major reasons for the increase in demand for hotel rooms in the country is the boom in the overall economy and high growth in sectors like information technology, telecom, retail and real estate. Rising stock market and new business opportunities are also attracting hordes of foreign investors and international corporate travellers to look for business opportunities in the country.

The hotel industry in India is going through an interesting phase. The industry has a capacity of 110,000 rooms. According to the tourism ministry, 4.4 million tourists visited India last year and at the current rate, the demand will soar to 10 million by 2010 to accommodate 350 million domestic travellers. The hotels of India have a shortage of 150,000 rooms fuelling hotel room rates across India. With tremendous pull of opportunity, India has become a destination for hotel chains looking for growth.

Due to such a huge potential available in this segment, several global hotel chains like the Hilton, Accor, Marriott International, Berggruen Hotels, Cabana Hotels, Premier Travel Inn (PTI), InterContinental Hotels group and Hampshire among others have all announced major investment plans for the country. The Government’s move to declare hotel and tourism industry as a high priority sector with a provision for 100 per cent foreign direct investment (FDI) has also provided a further impetus in attracting investments in to this industry.

It is estimated that the hospitality sector is likely to see US$ 11.41 billion rise in the next two years, with around 40 international hotel brands making their presence known in the country by 2011. Simultaneously, international hotel asset management companies are also likely to enter India. Already, US-based HVS International has firmed up plans to enter India, and industry players believe others like Ashford Hospitality Trust and IFA Hotels & Resorts among others are likely to follow suit.

Niche Tourism

The concept of ‘niche tourism’ has emerged in recent years in counter-point to what is commonly referred as ‘mass tourism’. In a globalising world of increasing sameness, niche tourism represents diversity and ways of making difference. It plays on the pejorative connections that have accompanied the evolution of mass and package tourism and their, often cited, negative impacts in relation to environmental degradation and socio-cultural disturbance. For destination managers and planners seeking to utilise tourism as a mechanism for economic development, the niche tourism approach appears to often greater opportunities and a tourism that is more sustainable, less damaging and more capable of delivering high spending tourists.

The term niche tourism is largely borrowed from the term niche marketing, which in turn has appropriated the niche concept from the language of the relatively recent discipline of ecology.

Tourists, as consumers have developed increasing levels of expertise and experience of being tourists. Whilst this developmental pattern of tourists may not always be linear or simplistic.

Figure 2: Niche Tourism Components

Types of Niche Tourisms

Niche tourism has broadly been divided into following components:

Cultural Tourism: Cultural tourism is the subset of tourism concerned with a country or region’s culture, specifically the lifestyle of the people in those geographical areas, the history of those peoples, their art, architecture, religions, and other elements that helped shape their way of life. Cultural tourism includes tourism in urban areas, particularly historic or large cities and their cultural facilities such as museums and theatres. It can also include tourism in rural areas showcasing the traditions of indigenous cultural communities (i.e. festivals, rituals), and their values and lifestyle.

Environmental Tourism: Environmental tourism, ecotourism, or nature tourism provides an opportunity to visit undisturbed natural areas, scenic vistas, and observe plants and wildlife. Ecotourism is responsible travel to fragile, pristine, and usually protected areas that strive to be low impact and often small scale as an alternative to mass tourism. Its purpose is to educate the traveller and provide funds for ecological conservation, directly benefit the economic development and political empowerment of local communities and foster respect for different cultures and for human rights. Generally, ecotourism focuses on volunteering, personal growth and environmental responsibility. Ecotourism typically involves travel to destinations where flora, fauna, and cultural heritage are the primary attractions. One of the goals of ecotourism is to offer tourists insight into the impact of human beings on the environment, and to foster a greater appreciation of our natural habitats. Responsible ecotourism includes programs that minimize the negative aspects of conventional tourism on the environment and enhance the cultural integrity of local people.

Rural Tourism: Any form of tourism that showcases the rural life, art, culture and heritage at rural locations, thereby benefiting the local community economically and socially as well as enabling interaction between the tourists and the locals for a more enriching tourism experience can be termed as rural tourism. Rural tourism is essentially an activity which takes place in the rural areas.

The term “rural tourism” was adopted by the European Community to refer to all tourism activities in rural areas or as an economic activity, which depends on and exploits the countryside.

Figure 1: Rural Tourism Approach

Forms of Rural Tourism

Agritourism: Agritourism or farm tourism refers to an organization working on farm or agricultural plant made for entertainment of tourists or visitors, thereby generating income for farm owners. This may help the farmers to interact with the visitors, thereby benefiting the visitors to enrich their knowledge regarding agritourism.

Sports Tourism: It involves tourists to participate or observe rural sports. It teaches the local rural people how to get scope/chance in international game and to compete with opponents. It enables the people of different cultural background to mix with other people and exchange cultural activities between the parties and thereby they are culturally rich.

Pro-Poor Tourism: Pro Poor tourism is set up in developing countries as a means to improve the local economy for local people. It enhances the linkages between tourism businesses and poor people; so that poverty is reduced and poor people are able to participate more effectively in tourism development. The aims of pro-poor ranges from increasing local employment to involving local people in the decision making process.

Introduction to Rural Tourism in India

Majority of India is among the rural category with the sanctity and subtleness intact in the very essence of the village soil. This pious environment of the rural India attracts lot of interest among the tourists in India and thus rural tourism is a fast emerging category.

A national tourism policy was introduced in 2002, with rural tourism identified as a focus area to generate employment and promote sustainable livelihoods. The government in its 10th five year plan has focused on the subject of rural tourism. With a rich diversity in culture, heritage, food, crafts, and tradition, India has immense potential and opportunity. It has identified certain areas across the country, which can immediately be developed as the rural destinations.

The government partnered with the United Nations Development Program (UNDP) for an Endogenous Tourism Project. Some 30 rural sites were selected in 20 states to develop as destinations for rural tourists. The UNDP pumped in an initial US$2.5 million. Those proposals that were selected by the government were entitled to assistance up to US$100,000.

Divining Forces in Rural Tourism

Industry stakeholders define the rural tourism experience by what they offer as product. But they are simply responding to what they perceive as an increasing demand for experience of rural communities, and interpreting it via their own world views. This demand is driven by a range of forces that combine to create tourist interest in rural experiences. These forces have been identified by many authors and can be summarised as:

Tourist generating regions for rural tourism are highly developed and urbanised. The stresses of urban living and the remoteness from the natural environment has created a desire for escape from the monoculture of city living.

Baby boomers are driven to tourism experiences that yield increased self-awareness in their drive for “longed for perfection” that compensates for lives “destabilised by uncertainty and insecurity” (Mackay, 1997)

Demand fuelled by media, over-familiarity and congestion with traditional tourist resorts and increased interest in alternative attractions with its voracious appetite for content and the resultant over exposure of many traditional tourist destinations.

Increasing environmental awareness and interest in the relationship between humans and the environment. Green issues have raised the attractiveness of rural experiences as ecologically sustainable tourism.

Transport, communication, and the removal of political and economic barriers to travel have facilitated accessibility of rural areas.

Increase in number of free independent travellers due to the increased capacity, especially in long-haul transport modes. When combined with increasing discretionary incomes, greater awareness of the range experiences on offer, the accessibility and attractiveness of rural destinations has been dramatically improved.

Changing work patterns have increased the popularity of shorter breaks that minimise the absence from work and the effect of absences on work flow and involvement.

An increased interest in heritage can be satisfied through rural tourism as rural areas are often the repositories of remnant heritage.

Rural areas are perceived as healthier, offering fresher air, cleaner water and the opportunity for outdoor recreation. Rural areas offer fresh and speciality food. (Bartmann and Baum, 1998)

Issues with Rural Tourism

The lack of statistical base:

It is difficult to establish volume and value of rural tourism as a specific market sector in nations, even harder on an international scale. Many countries have different definitions of ‘rural’ and will therefore collect different data. Data on rural tourism are not easily obtainable.

Rural communities:

These tend to be non-uniform for example remove versus accessible rural areas contain very different types of settlement, employment opportunities, socio-demographic characteristics. Different community structures with diverse responses to tourism exist.

Tourism development strategies may not benefit all rural areas:

Where there is an inadequate supply of attractions or accommodation, tourism may not flourish. However marketing strategies must be good to attract tourists. Likewise, development of tourism provision by local people may not be feasible in a depressed rural economy.

Impact of Rural Tourism

The aim of tourism development in rural areas is, in general terms, to provide opportunities for economic and social development. In some areas, tourism provides the main source of income and employment, as well as providing social and economic benefits. Inevitably, negative aspects of rural tourism are evident as well. (Gannon 1994)





Assists viability of existing tourism and non-tourism business.

Encourages dependence on industry prone to uncontrollable change

Creates new employment

Creates part time, seasonal employment

Attracts inward investment

Incurs development costs and public service cost


Assists in viability of local service

Creates feeling of invasion by tourists

Creates sense of pride

Increases crime

Revitalises local culture, traditions, events and crafts

Reduction in local services


Leads in environmental improvements in settlements

Increases wear and tear on landscape features

Provides income for conservation of buildings and natural environment

Creates need for new developments which may not be in keeping with local area.

Fosters awareness of conservation as worthwhile activity

Increases pollution and affects local biodiversity

Table 1: Positive and negative impacts of rural tourism

Niche Market: A Place in Rural Tourism

If the importance of the products one buys lies largely in their potential as social markers, tourism marketers must focus both on tourism’s social signification and on meanings attached to spaces in which these occur. Explanations of tourism consumption cannot be derived in isolation from the social relations in which they are embedded. New users of the countryside are redefining what constitutes ‘rurality’, and there is a need to take postmodernism and the construction of the rural much more seriously. Contemporary social construction often transcends the countryside’s tangible characteristics and qualities of open space or fresh air by representing it as the setting for the achievement of a range of personal goals. The need for a wider sociological approach to tourism studies has been emphasised by Sharpley, who argues for the recognition of broader social and cultural influences that shape consumer behaviour as a whole and influence consumption patterns. In the interests of the rural environment, therefore, and of the small businesses trying to meet the needs of emerging markets, it is necessary to look beyond classical marketing theory to gain a useful understanding of ‘rural tourism’ consumption and to evaluate the existence of niches for marketing purposes.

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The increasing need for analysts to focus on consumption as an improved means of understanding contemporary forms of ‘rural tourism’ demand requires a dynamic framework within which the analysis can be conducted. A continuum to measure the relative importance of the countryside to the consumption of tourism in rural areas is proposed to indicate the importance of the countryside to the purpose of the trip and to tourist satisfaction. The significance of the model lies in its recognition of the primacy of neither tourism nor tourist types but the ways in which the countryside is consumed as a recreational resource.

Challenges and Opportunities in Rural Tourism

The major problem in rural areas is that there is not much scope for working. Most of the People are engaged in agricultural activities, some of them in forestry and others are artisans. Villages are struggling with large families with one or two earning members in the family and high consumption expenditure. Due to less scope in villages most of them started migrating to cities.

There are 638,691 villages in India as per the Census Report 2001 and the rural population is 741,660,293 with average population of 1,161 per village. Many of these rural communities have the potential have the potential resources, ability to attract the growing tourism industry. The scenic beauty, historical importance may appeal the urbanites, caught up in today’s fast pace of lifestyle.

Challenges in Rural Tourism

The major challenges are the need to preserve the environment and natural resources and the need for proper education.

Legislation Problems

Respondents have pointed out that there can be legal problems. Tourism is a part of entertainment industry. All hotels, motels and cottages having license pay taxes to government. Rural tourism should have a tax holiday or it should be tax free. The government should encourage rural tourism to grow.

Lack Of Trained Man Power

The ruler people require to be trained for discharging their duties, decorating the cottages and maintaining them, serving food to the visitors and to understand the taste of the costumers, either the local cuisine or different type of Indian cuisine. The success of rural tourism totally depends on the quality of service provided to the tourists. To develop the manpower government has to take initiative to open various short training courses for imparting knowledge and skills.

Insufficient Financial Support

To start rural tourism, sufficient fund is required to promote it in introductory phase. Rural tourism is still uncommon to many tourists. This is because the government has just started promoting rural tourism. Central and state government should encourage rural tourism by providing financial support to start the project. As it will create employment in rural areas and will help the inflow of funds from rural areas to urban areas.

Lack of Local Involvement

Since rural people do not have knowledge and skills to involve hem in different activities. They may get the job of unskilled workers. The rural people need to develop the knowledge and skills to have a higher involvement in rural tourism. The basic concept behind the rural tourism is the participation of rural people. But in practice local people are seldom involved in decision making, planning and implementing policies. Most of rural people do not have much knowledge of tourism, and are misled by outside investors who hope to take most of the economic benefits from rural area.

Language Problem

There are 16 recognized languages and 850 dialects in India. Although ‘Hindi’ is an official language, in many parts of India people do not understand it. The rural people have to upgrade themselves to communicate with the urbanites. The villagers not only have to educate themselves but they have to understand hindi to interact with the Indian costumers and English to communicate with the foreign costumers.

Opportunities in Rural Tourism

The tourists look for quality environment and meaningful experience. Marketing of rural is a specialist job. For rural tourism, rural people have to surrender themselves to professional marketers who understand the complexity of their task. The business depends on the development of networks, creation of trust and loyalty and information system, all of which takes money and time to develop, which is beyond the resources of most individual.

Tourists have become more educated, more aware of facilities available and more experienced, their expectation has also increased. People are interested in exploring new places. Rural tourism in India has great future, since it not only provides natural elements of beauty but also the indigenous local traditions, customs and foods. Direct experience with local people can be a unique selling proposition to attract tourists. Every state in India has unique handicraft, traditions and foods. The rural tourism not go for mass marketing, rather different strategies should be under taken for different segment to make it successful.

Introduction To Laksh Farms, Mangar Village

Situated in Village Mangar, off the Gurgaon-Faridabad Highway, Laksh Farms is just a 30 minutes drive from Chattarpur Mandir, Surajkund, Gurgaon and Faridabad. Spread over 15 acres, Laksh is located in a picturesque valley nestled in the Aravalli Hills, on the once-famous Dhauj Jheel. A unique example of the restoration of a degraded ecosystem, it offers a fulfilling experience in rural eco-tourism. With more than a few thousand indigenous and ornamental fruit trees and shrubs, Laksh is a naturalist’s delight, propagating organic farming using vermi-compost and bio waste. For animal lovers there are dogs, dairy cattle, goats, ducks, and geese, as well as an abundance of peacocks and deer throughout the area and also in the ‘sacred forest’ around the Gudariya Baba Shrine.

All in all, Laksh offers a magnificent rural experience with activities such as rock climbing, camping, organic farming, trekking, and nature walks, bird watching and cycling in the ancient and awe-inspiring Aravallis Khandavprastha of the Mahabharata.


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