In fact, government funding for overseas tourism promotions has been declining over the years, from ₹524 crore in 2021-22 to ₹341 crore in FY23 and ₹167 crore for FY24. However, a large sum of money has been allocated for developing pilgrimage destinations, up 66% from ₹150 crore in FY23, to ₹250 crore in FY24.

However, overall allocations for tourism sector remains flat at ₹2,400 crore, compared to the FY23 outlay. That said, so far in FY23 only ₹1,343 crore was spent for promoting tourism, and only ₹60 crore out of the ₹341 crore was spent on overseas promotions. An equivalent amount was spent on domestic campaigns, instead of the allocated ₹75 crore.

More than 50% of the tourism budget has been allocated to Swadesh Darshan scheme, which was launched in 2014-15 for integrated development of theme-based circuits, as sustainable and responsible tourism destinations within India. So far, 76 projects have been sanctioned under the scheme across 13 circuits. The government said it will develop 50 new tourist sites ensuring high standard of food, streets, security and other amenities.

Destinations will be developed both for foreign as well as domestic tourists, the government said, but did not divulge give any further details.

According to industry insiders, the Centre has missed the opportunity to back the Indian tourism industry, considering that many countries like China are still reeling under a covid scare, resulting in lower footfall of foreign tourists. “International travellers cannot visit China, and India should have taken steps to use that opportunity. Instead, we are going to miss out since we have slashed our overseas tourism promotion budget by more than half. The tourism budget depends on this one-line item. This year could have been a great opportunity for a tourism boom for India,” said Dipak Deva, managing director, Travel Corp. of India Ltd.

Deva said he was expecting at least ₹750 crore for the industry with a majority being spent on digital mediums, travel shows and marketing tourism destinations.“With such a small allocation, we can’t have a big bang impact on tourism. I don’t think we can go back to $30 billion forex earnings that we had in FY21,” Deva added.

The Incredible India campaign which started in 2002 to promote tourism has been offline since 2020. A huge blow was also dealt to tour operators who help tourists plan international holidays. Tax collected at source (TCS) for Indians planning international holidays through local travel operators has been increased fourfold from 5% to 20%.

Subhash Goyal, chairperson of the Confederation of Tourism Professionals, said the tax rate hike will hit businesses. “It will result in Indian travellers opting for international websites instead of domestic services to buy packages for overseas travel ,” said Goyal.

He added that closing down tourist offices in various countries could be a reason why the government has also slashed the budgets for overseas promotion. “Not much has also been mentioned about them hosting the G20 summit, no plan has been made or explained on what they intend to do with that,” he said.

Rajiv Mehra, president of the IATO, a body of inbound tour operators in the country, said, unlike other years, the sector was not overlooked this time. “But some of our members who do outbound tourism business will have to close their businesses with the increase proposed in TC. This needs to be rolled back immediately.”

“The move to increase the TCS mandate will not only increase the upfront cash outflow for customers but will also give an unfair advantage to foreign-based online travel booking platforms over India-based travel agents and tour operators,” added Rajesh Magow, co-founder and group CEO, MakeMyTrip Limited.

Mehra though said the announcement on redeveloping 50 old airports, heliports and sea ports could be beneficial as there are certain places which tourists cannot currently reach due to poor connectivity.

In the budget, the government also added that high standards for food streets and security for tourists will be a focus and that states are encouraged to set up unity malls for the promotion of state products.