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Tourism Conundrum

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Bhutan used to ‘discriminate’ between ‘regional tourists’ (from India, Bangladesh and Maldives) and others by charging each of the latter 250 dollars per day, part of which comprised a ‘sustainable development fee’. Now, it plans to impose this fee on everybody. This is an extension of the country’s ‘high value, low impact’ concept of tourism. The idea is simply that Bhutan’s tourism potential is limited so the product will have to be priced higher. It will become a ‘premium’ destination and is expected to generate the same amount of revenue with less pressure on its resources. This will impact greatly on the tourism operators of North Bengal, as well as the ‘budget’ tourists from the regional countries. The hoi polloi will now have to seek other haunts and the Indian destinations in the region will naturally be the ‘beneficiaries’.

How much economic sense this makes will become known over time, but marking up a product is nothing new. Bhutan is obviously looking at total revenues and not how much employment the crowds generated downstream. Premium products require more qualified staff to deliver and whether this is available in that country is questionable, and it may just end up importing Indians for the task.

Similar problems of ‘over-crowding’ are being faced in many of the world’s popular tourism destinations. This is particularly so with the spread of Airbnb, vacation rentals and homestays. It is being suggested that Bhutan type solutions be implemented in Uttarakhand, too, to save the local culture, lifestyle and the environment. However, it is not just a question of raising the rates; the entire concept of luxury tourism requires a different implementation, with much planning, brand promotion and activities. The backpacker and budget tourist also create a social and cultural exchange opportunity for the locals, while luxury tourists require only ‘service’. Culture is basically presented on a plate with packaged ‘performances’ by the ‘natives’. Local people lack the capital to run such enterprises and it leads to large corporations entering the sector. Locals end up herded into enclaves, while prices of everything go up, including homes.

Almost every region popular with tourists has its own set of problems – anybody who has visited Goa or Himachal Pradesh will testify to the varying outcomes. In the middle ground, of course, both regulation and organic growth are needed. It must not be forgotten that, no matter how noble the intentions, market forces cannot be denied. High quality and low prices are usually the path to commercial success.