Finance Minister Nirmala Sitharaman under the Narendra Modi-led Indian government presented the Union Budget 2020-21 on Feb 1.

Major announcements with regards to the aviation and tourism sector in India were made:

  • The government will develop 100 more airports by 2024 to support the UDAN (Ude Desh ka Aam Naagrik). “India’s domestic aviation sector has been growing and UDAN scheme has contributed to the growth,” said Sitharam. At the moment, 232 routes across 43 cities and towns connect 137 small cities under the Regional Connectivity Scheme that was launched in October 2017. You can read more about the UDAN scheme here
  • The Finance Minister also proposed launching a separate Krishi UDAN scheme, which will improve connectivity with the country’s northeast region.
  • More trains like the recently launched Tejas Express are in the pipeline. IRCTC’s (Indian Railways Catering and Tourism Corporation’s) Tejas Express from Ahmedabad to Mumbai, India’s second private train, was flagged off on January 19. “We will redevelop four railway stations with the help of the private sector. More Tejas type trains will be developed to connect iconic tourist destinations,” said the minister.
  • She also announced the rolling out of the Kisan Rail project that will be implemented through a public-private partnership as part of the government’s efforts to boost connectivity within regional India.
  • The minister announced the grant of ₹25,000 million to India’s tourism development. Following which, she highlighted that India has moved up from rank 65 in 2014 to 34 in 2019 on Travel & Tourism Competitive Index of the World Economic Forum.
  • Sitharaman announced the allocation of ₹31,500 million to the Ministry of Culture. A number of museums at archeological sites will be developed in the country. These include Rakhi Gadi in Haryana, Hastinapur in UP, Dholavira in Gujarat, Shivsagar in Assam and Adichanallur in Tamil Nadu. A Tribal Museum will also be developed in Ranchi. The Indian Museum in Kolkata will be re-curated and a museum on numismatics and trade to be opened in the historic Old Mint building in Kolkata.

“Grants to states for specified tourism initiatives, development of heritagesites and museums are welcome steps. However, I would expect the investments proposed in tourism, however, to be upped in the coming years,” says Jaideep Ghosh, Partner, KPMG in India.

Rahul Chaudhary, CEO & MD, CG Hospitality & CG Corp Global said, “With the growth of tourism comes the creation of jobs. While the Tourism sector contributes almost 10 per cent of India GDP, expected to create employment growth of 10 per cent annually. State governments have been given more incentives to promote infrastructure and heritage sites through the UDAN and Tejas schemes which will further link less travelled locations which have the potential to become very attractive circuits.”