Govt announces 500,000 free visas, loan guarantee scheme for travel sector

The scheme will benefit 11,000 stakeholders including 904 tour operators and 10,700 tourist guides, FM says

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Finance minister | Nirmala Sitharaman

The Centre today announced free visas for 500,000 tourists and a loan guarantee scheme to support recognised tour operators and tourist guides whose business has been disrupted due to Covid-19 pandemic.

Free visas will be issued once the government reopens borders for leisure tourists and working capital or personal loans will be provided to travel firms and registered tourist guides to discharge liabilities and restart their business.

The scheme will benefit 11,000 stakeholders including 904 tour operators and 10,700 tourist guides, union finance minister Nirmala Sitharaman said. Loans of Rs 10 lakh and Rs one lakh with hundred percent guarantee will be provided to travel firms and guides respectively.

In 2019 over 10.9 million foreign tourists visited India and contributed to over $30 billion in foreign exchange earnings. Sitharaman said once visa issuance is started the first 500,000 tourist visas will be issued free of charge. The scheme will be applicable till March 31 and will reduce government income by around Rs 100 crore.

The government relaxed entry norms allowing business visitors and overseas citizens of India to travel to India last year itself. Entry to foreign tourists is still barred. While the tourism ministry is in constant dialogue with the health ministry, a decision on the date of opening is not clear. This would depend upon multiple factors such as increased pace of vaccination, reduction in active Covid-19 cases and reduced threat from new variants such as the Delta plus.

“We feel the grant of free visas will be a big game changer for Indian tourism. Several tourists from our key markets in West Europe and the US had postponed their travel to India last year and we hope they will plan trips once we open our borders for them,” said tourism ministry’s additional director general Rupinder Brar.

Trade bodies welcomed the move but members said the announcement fell short of their expectations as the industry was hoping for grants and waiver from statutory obligations.

“The waiver of fee for 500,000 tourist visas sends a positive signal but should be extended till 2023-24 or at least till all pre-pandemic tourist business is restored. The quantum of support to tourism service providers should be increased and made proportionate to their business sizes and since they are being administered through tourism ministry they should be reclassified as pandemic relief grants and not as loans to enable working capital support for salaries and operations,” said Ashish Gupta, CEO of Federation of Associations in Indian Tourism and Hospitality.

“We are on oxygen now and a grant would prevent us from being put on a ventilator,” said Indian Association of Tour Operators president Rajiv Mehra. Hotel Association of India secretary general MP Bezbaruah said industry hopes that today’s announcement will be logically followed by measures to make the industry recover and get ready to welcome the tourists.

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