With the right government support, the tourism sector has the potential to solve 50 per cent of the country’s employment problems, Patu Keswani, Chairman and Managing Director of Lemon Tree Hotels, said on Saturday. Speaking at the first National Conclave on India 2047 organised by IIM Calcutta, he said India’s tourism sector is on the verge of a tipping point.
Keswani pointed out that in several countries the tourism sector contributes 15 to 20 percent of GDP and provides 25 percent of jobs.
Expressing disappointment over the government’s approach towards the tourism sector, he said, “In India, tourism contributes only 6.5 per cent to the GDP and a similar share to employment. This sector has tremendous potential for job creation.”
“If the government can use this opportunity effectively, it could solve up to 50 percent of our employment problems,” he said.
Discussing India’s current economic landscape, Keswani noted that the country is at a critical inflection point, similar to China’s situation during its rapid growth phase.
He stressed that even household incomes in India are growing at 6 to 7 percent annually, which is the basis for a significant change in consumption habits.
“There are 280 million households in India, but currently only five million of them – less than two percent – are active consumers of consumer goods such as SUVs and compact cars,” Keswani said.
“However, with continued economic growth, this number could rise to 30 million households, which would represent a significant increase in economic activities. This is exactly the kind of transformation that has taken place in China and is now taking place in Vietnam,” he said.
Keswani cited several positive indicators of India’s economic dynamism, including the expected increase of 1,500 aircraft over the next five years, the doubling of airports, the tripling of runways and the expansion of four-lane highways over the next four years.
“This expansion of connectivity is a tremendous opportunity for tourism in India, the likes of which we have not seen in the last 75 years,” he added.
