The Covid-19 pandemic began, as is mentioned by various sources, in the December of 2019, at Wuhan, a city in China. However, the world as such has taken note of the new virus by the fourth week of January 2020 when the Peoples Republic of China has announced stringent military-style regulatory measures to curb the new outbreak. Following the international outbreak of the virus in late February, Governments across the world had levied strict regulatory measures to restrict the movement of people, materials, and any other moving items, all to arrest the menace of the Covid-19 virus. India had reported its first virus outbreak in the March of 2020, first in Kerala State.

On 24th March 2020, the Government of India declared a “Lockdown” throughout the country to curtail the COVID-19 pandemic that had entered the country through travelers from a foreign state. The initial 21-day Lockdown, which manifested itself into a 2 month-long social and economic shutdown, resulted in not only the curbing of movement of goods and people but a looming stagnation in every walk of life and more so, the stagnation in industrial output, jobs, and all related economic activities. There commenced a loss of revenue to the working laborers and the businesses as a whole which resulted in India moving in a negative trend in its growth curve. This loss is acute in sectors particularly connected to the travel and tourism industry. Many states in India rely heavily on tourism, domestic as well as international.

Kerala, a coastal state on the west coast of India and is the southernmost part of the country, wherein tourism is one of the mainstays of its economy, has felt the pinch of this new reality – in which travel is no longer permitted or allowed scarcely from inside or outside of the country.

To effectively analyze the business ecosystem impact, we must first examine the tourism industry before the strike of the Pandemic:

Pre-COVID conditions in India as a whole and Kerala as a state:

The tourism sector has been one of the fastest-growing sectors constituting 9.2% of India's GDP in 2018 and it continues to grow. The primary reason for this growth is the recent improvements/modernization of transportation facilities and infrastructure as well as the constant increase in the disposable income in the country that as of 2019 was at an all-time high of 206752290 Million INR.

India like most other countries consists of two types of tourism industries:

•           The Domestic tourism

•           The International tourism

The share of domestic tourism in certain countries such as Seychelles or Colombia is smaller when compared to their international counterparts.  However, the same does not hold in India which as a result of being the 7th largest country in the world by landmass and 2nd largest by population, has domestic tourist visits amount to 2.3 billion visits across the country. The primary reason for the large domestic tourism market is the cheap traveling and living costs of intra-national travel.

Another reason is the varied geography and culture of the nation. India is a diverse nation, both geographically and culturally as it houses more than 100 languages and geographic extremes.

The difference in geography can be seen by analyzing India as two halves:

(North India and South India)

North India faces a temperate climate, with cold winters and hot summers, while South India faces an Oceanic/Moderate climate due to its presence in a peninsula. In addition to this, the south houses many coastal and tropical locations while the north houses many riverine and snowy locations. Therefore, there is a varied fauna, flora, and landscape. This difference allows domestic tourism to bear its roots deep as there is much to explore for a tourist within the country itself.

Constituents of the Kerala Tourism industry:

The majority of the local economy consists of businesses from the unorganized sector. The unorganized sector is defined as the “The unorganized sector is made up of every unorganized private company owned by individuals and households engaged in the sale and production, with fewer than 10 employees, of products and services conducted in a proprietary or collaboration manner.”.

Therefore, many of the businesses are integrated forming a close-ended business structure that would have an impact on the business chain magnified if there is no demand in the tourism industry.

The Impact:

First impact period:

The first impact period was the most detrimental to the business ecosystem as the demand for the services offered in the tourism industry was virtually nil. Therefore, leaving the tourism sector with no monetary activity for a 7th-month span. This cause a surge of insecurity among the proprietor’s/service providers as their primary source of income was negligible.

In my interview with Mr. Rupesh Kumar, who is head of the Responsible Tourism program in Kerala, it was mentioned that core characters of the industry such as the Housing & lodging as well as houseboat market were put on a standstill and supported by the state government grants. However, the Souvenir/Handicraft industry was able to be mobilized through online integrations as much of the products were sold through E-commerce.

In addition to this, the tourism dependant industries, though losing demand due to the fall in tourism, were able to function through domestic demand. This includes industries such as the fishing and transport industries.

However, the tourism industry in Kerala was able to benefit from the “Industry” status it was given which most of its neighboring states do not enjoy. Kerala is one of only eight states in the country which consider tourism an industry. Through the Industry status, the local businesses in Kerala were able to gain monetary support, avail low-interest government laws, and be beneficiaries in commercial relief programs.

Second Impact Period:

The second impact period was the rejuvenation of the tourism industry in small doses. The reason that the industry could not come back to its previous functioning was due to three factors:

1.     Government Travel regulations

2.     Loss of foreign travel

3.     Unwillingness to travel in a pandemic

Through my interview with Mrs. K K Shailaja, Minister of Health, Government of Kerala, it was mentioned that the primary goal of the government being the protection of civilians against the virus, the COVID regulations have to saw that allows only those individuals that have not contracted the virus through its borders. Therefore, it required tourists to possess RTPCR (COVID negative) reports and a mandatory quarantine (this policy was terminated in October). This though serves as an efficient safety net, discourages tourism within the state.

In addition to this, the Minister had also stressed how only “Open” tourism was allowed Open tourism here refers to tourism activities that take place in open areas and not closed areas i.e. areas with less open-air circulations such as theatres.

Though these steps had slowed down the re-growth of the tourism industry, the industry has however been able to sustain itself until the completion of the vaccination process. In addition to this, houseboats and housing & lodging were able to gain revenue once again as December had considerable tourist footfall.

Long Term impacts:

The most notable long-term impact would be the restructuring of the tourism industry's dependence on foreign tourism. The industry has been exposed t the uncertainty of foreign tourism and the comparative reliability of domestic tourism. Therefore, developments in tourism attractions targeted at domestic tourism can be anticipated. In addition to this, the Responsible tourism program has already started adjusting pre-existing tourism packages to consist of activities that entertain domestic tourists more.

The second impact would be how tourism would reduce in its presence as the primary source of revenue for small businesses This is supported by the action of the “Responsible Tourism Programme”, as the organizations are encouraging businesses in the unorganized sector to see the tourism industry as a secondary source of income and to base their primary income in a more stable industry. This transition would be also being beneficial because Kerala is susceptible to floods which would result in damage to tourism infrastructure and cause the loss of livelihood to those who rely on tourism as their primary source of income.

The final, wide-scale change would be the adoption of ‘tourism’ as an industry throughout the country. Until 2020, the government had no motivation to consider tourism as an industry, however, the pandemic has proved otherwise. We can see this taking place with the latest industry inclusion for tourism in Karnataka in 2021 with many others set to join in on the process.

Conclusion:

The industry still faces many challenges, especially with the second wave of COVID-19 that is causing loss of life and serving as a possibility for a 2nd national lockdown. However, though hurdles in its path seem to transform into Barricades, the tourism industry of Kerala seems to be ready for the uncertainty, going at it at full throttle.

Sources:

“India Total Disposable Personal Income | 1950-2020 Data | 2021-2023 Forecast.” tradingeconomics.com/india/disposable-personal-income (April 9, 2021).

“Tourism in India.” 2021. Wikipedia. en.wikipedia.org/w/index.php?title=Tourism_in_India&oldid=1016288898 (April 9, 2021).

Prakash, B A. “THE IMPACT OF COVID-19 ON KERALA’S ECONOMY: A PRELIMINARY ASSESSMENT.” : 23.

“Tourist Statistics.” Kerala Tourism. keralatourism.org/touriststatistics (April 30, 2021).

“Contact Responsible Tourism Mission | Kerala Tourism.” Responsible Tourism. keralatourism.org/responsible-tourism/contact-us (April 30, 2021).

“India Visitor Arrivals Growth [Up-to-Date Chart & Data].” ceicdata.com/en/indicator/india/visitor-arrivals-growth (April 30, 2021).

Primary research sources:

Interview with Mrs. K K Shailaja, Minister of Health, Government of Kerala.

Interview with Mr. Rupesh Kumar, Head of the Responsible Tourism program in Kerala.