Covid-19: Tourism, aviation bear brunt of ban on entry of foreigners
3 min read 12 Mar 2020, 11:41 PM ISTAirlines and hoteliers have been hit by a rash of cancellations to popular destinationsThe vast majority of the infected 126,000 people are in just four countries-- South Korea, China, Iran and Italy
PremiumNEW DELHI : India’s decision to temporarily bar entry of foreigners to contain the spread of Covid-19 will severely affect the country’s aviation and tourism sector, industry leaders and experts said.
Already reeling from the impact of Covid-19 since its outbreak in late December, airlines and hoteliers have been hit by a rash of cancellations to popular destinations.
The Indian government on Wednesday decided to bar the entry of foreigners and kept on hold the visa-free facility granted to Overseas Citizen of India (OCI) cardholders from 1200 GMT Friday, adding to measures to combat the Covid-19 pandemic.
All tours and bookings are being cancelled and there is no option but to follow the government order, said Pronab Sarkar, president of Indian Association of Tour Operators.
“Our total volume of inbound tourism is 10 million (people) annually. We think the impact (of the government order) is going to be around 1.2 million (less) tourists and a revenue loss of about $3 billion," Sarkar said.
“Outbound travel is also affected badly because of government advisory. The impact on ticketing -- 50% cancellations have been recorded since 1 March," Sarkar said, adding that the advance bookings for upcoming summer vacations is also on the wane.
Sabina Chopra, co-founder and chief operating officer, corporate travel and head industry relations, Yatra.com, said that it has received close to 35% queries for cancellations from customers planning trips to foreign destinations.
“With Indian airlines having suspended flight operations to destinations with high coronavirus risk, airfares have also dropped by 40% to affected destinations," Chopra said.
Hotel rates have dropped by about 18% drop amid a flood of cancellation requests from travellers wary of travelling even in the domestic sector, she added.
“Hotel occupancies are down 30-40% and even within India, people are not travelling as frequently as they would earlier," said Subhash Goyal, chairman of the tourism committee at industry body Assocham.
“The industry was already suffering huge losses because of cancellations they were receiving since the outbreak of the epidemic and whatever little travel was there was essential and to stop this all of a sudden is going to completely cripple the industry and aviation, tourism and the hotel industry," Goyal said.
The Indian aviation industry, which is seeing a prolonged period of single-digit growth in domestic passenger traffic, is expected to incur losses in the coming quarters.
InterGlobe Aviation Ltd, which operates the country’s largest domestic airline IndiGo, on Wednesday said bookings have dropped 15-20% in the last few weeks due to the outbreak of Covid-19.
The airline expects its upcoming quarterly earnings to be materially impacted due to the pandemic.
National carrier Air India, which operates several long haul international flights, is set to redeploy some international capacity to domestic sectors, an airline official said on condition of anonymity.
Air India has suspended flights to Rome between 15-25 March, adding to suspensions to Milan and Seoul during 14-28 March. The government decision will also hurt foreign airlines who make up the lion’s share of international air traffic from and to India.
Meanwhile, the sweeping travel bans that accelerated around the globe on Thursday will also affect airline operations. Several major global carriers have already reduced capacity worldwide in wake of the Covid-19 outbreak. “We are currently assessing the impact of the recent guidelines by the Indian government on our operations to and from India," a Lufthansa spokesperson said in a statement.
A spokesperson of Singapore Airlines said it is unable to provide any cancellation figures as the situation is still being assessed.
“For customers who are unable to travel due to entry or transit restrictions, we will waive all cancellation fees," a spokesperson for the airline said.
An Emirates spokesman said it is also offering passengers travelling to India the option of rescheduling their trips.
A spokesperson for Virgin Atlantic said the airline is aware of the travel advisory issued by the Indian authorities and is currently evaluating what this means for its customers and flying programme.
A spokesperson for United Airlines, meanwhile, said that the airline will comply with the Indian government order.
British Airways, LOT Polish Airlines, Air France-KLM, Swiss, Qatar Airways, Etihad and Fly Dubai, did not respond to queries.
rhik.k@livemint.com
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