By VK Lyngdoh
Tourism contributes to the Gross Domestic Product (A monetary value of all finished goods and services made) and overall economic health of a state or country. To assess the contribution of tourism to the GDP of a state or country involves considering several key factors:
1. Tourism Direct GDP: This measures the direct contribution of tourism to the economy, including spending by tourists on accommodation, food, entertainment and transportation.
2. Employment Generation: The number of jobs created directly and indirectly by the tourism sector, including those in hotels, restaurants, travel agencies, and other related services.
3. Tourism receipts: The revenue generated from international and domestic tourists, including spending on goods and services.
4. Tourism Value Added: The net output of the tourism sector after subtracting intermediate consumption. This helps in understanding the actual economic value generated by tourism.
5. Foreign Exchange Earnings: The amount of foreign currency earned through tourism, which can significantly impact the balance of payments.
6. Contribution to Government Revenues: Taxes and fees collected from tourism-related activities, such as hotel taxes, airport fees, and sales taxes on tourism services.
7. Infrastructure Development: Investment in infrastructure like airports, roads, and public facilities that support tourism and contribute to overall economic development.
8. Tourism Satellite Account (TSA): A standardised framework recommended by the United Nation World Tourism Organisation (UNWTO) to measure the economic impact of tourism. It provides detailed data on tourism’s contribution to GDP, employment and other economic indicators.
9. Seasonality and Regional Distribution: Understanding the seasonal patterns of tourism and its distribution across different regions helps in planning and managing resources effectively.
10. Sustainable Tourism Practices: Assessing the implementation of sustainable tourism practices and their impact on long-term economic growth and environmental conservation.
These factors collectively provide a comprehensive picture of how tourism contributes to the GDP and overall economic health of a state or a country.
I am inquisitive at finding out what the contribution of tourism in Meghalaya to the State GDP is. But it is very difficult to obtain the data on this matter given the fact that there are ten key factors as stated above to assess the contribution of tourism to the GDP of the State. However, I thank the Deputy Director Economic and Statistics, Meghalaya of the National Income Division (NID) for providing me the data which they have worked on their own in spite of their limited resources given the vastness of the factors involved to work out the estimates that tourism sector contributes to the State’s economy. I was informed that during the COVID 19 years, the contribution of tourism was less than 1 percent of the GDP of the State. Tourism then picked up in 2022-23 to 2.43 percent which in monetary terms equals Rs 995 crore. This is a substantial sum and if tourism nosedives many who earn their livelihoods from it will be rendered jobless and their investment infructuous.
According to the Statistical Hand Book, Meghalaya, 2023, Directorate Economics and Statistics, Table 25.03 Hotel Occupancy Statistics shows that in 2018 Meghalaya had 502 hotels which remained the same till time COVID 19 struck. The numbers have gone up to 550 in 2021 with 63 % of the Hotels located in Shillong. In 2022 the number went up to 727 in the State. Surely it is a huge investment made by both the private and the government sector. Statistics also indicate that in 2020 when COVID 19 struck occupancy nosedived to -98 percent and recorded just 27,045 tourists visiting the state. It further picked up in 2021 recording 1,54,820 which is up by 472.45 % and in 2022 it went up to 9,44,865 that is up by 510%. Recent press reports indicate that booking has slumped to 30%. This means that there is a reduction to the tune of 233% when compared with the occupancy rate of 2022. This is alarming. It is important to note that tourism flourishes if safety is top class. The tertiary sector of the economy that is tourism has a huge potential to grow and thrive in Meghalaya.