Tourism sector recording losses due to unregistered activities: Report

PANJIM: The just-released report on Goa’s Tourism Industry has indicated that the sector is recording losses due to unregistered activities, particularly due to illegal accommodations, although tourism is increasing.   

The report based on a survey conducted by government-appointed private agency KPMG, states that Goa  has  recorded  a  growth  in  tourism  footfall  in  the  last  few  years, yet  hoteliers  are reporting  a  decline  in  their  occupancy  rate.  

“This paradox seems largely due to the prevalence of informal/unregistered activities.  For  accommodations,  for  instance,  this  report  estimates  more than  70  per cent  of  rooms  available  in  Goa  are  out the radar  from  official  data, this  may  include unregistered hotels, unregistered rooms or second homes rented to tourists on online platforms. As a consequence, given the inflation in the number of available rooms, formal registered units are facing harsher and harsher competition. The cake might get bigger since the absolute number of tourists is increasing but the pieces are getting smaller as more businesses are competing,” the report titled “Coping With COVID-19 – Survival And Revival Of Goa’s Tourism Industry”, reads.  

Similarly, it further said, the total volume of tourists has been increasing while the value brought to Goa by visitors seems to be on a declining trend.  It explained that more tourists seem to be coming to Goa but they also spend less. “It is undeniable that the universalisation of Goa as a tourism destination has brought to the State larger masses of tourists which could not have afforded travelling one decade ago. While this might be positive from a social perspective, for Goa this trend has implied more volume but not necessarily significantly more profit. The core of the problem seems to be more about quality than quantity,” it said. 

The report reiterated that tourism volume has been undeniably growing but the State is benefiting less from it. The 155-page report has also opined that in the months and maybe years to come, footfall is going to reduce due to reluctance among tourists to travel for the fear of the virus and new social distancing norms limiting flows of tourists as planes and trains will allocate only a limited number of seats (two third of the usual capacity) to reduce physical proximity. The number of foreign guests is surely going to reduce sharply.

This report estimates that in 2019 year, Goa generated Rs 12,681 cr of revenue from tourism activities. To maintain the same level of revenue with less tourists the report suggested to increase the average amount spent per tourist. As per the analysis of the present report, tourists in Goa spent on an average Rs 9,016 per trip and per visitor in 2019.

The agency arrived at these figures based on the estimation that the actual tourist footfall in 2019 year was about 1.5 cr against only 89 lakh as per official figures. To come up with this figure, the research team also took into consideration the volume of tourism generated by unregistered activities (particularly accommodations) which, as of now, had remained unaccounted for.

“If footfall was to decrease by 50 per cent, the average amount spent per tourist should double and reach Rs 18,032. This would require a major shift for Goa in terms of product offering and profile of visitors,” it said. 

The report, while indirectly dismissing reports on decline in tourism in Goa, states that in just four years, from 2014 to 2018, the number of Indian visitors doubled, jumping from 40 to 80 lakh, while the number of foreign tourists increased by 80 per cent, from 5 to 9 lakh.