PM Narendra Modi could well have played the role of the opposite of Santa Claus this Christmas. The impact of demonetisation decision was evident in November PMI data for services and manufacturing and more is in the offing, according to brokerage Nomura. Kerala seems to have suffered a double-whammy in the form of currency crunch, after the ban on liquor a few months earlier, hitting tourism.
Read: Foreigners resort to street performances to gather money
Foreign tourist arrivals (FTAs) to Kerala, which is famous for its Ayurvedic treatment and backwaters, have suffered a massive jolt and so has Goa. Agra is another victim of subdued activity this year.
In a globalised world, it's not difficult to gauge the impact of optics in the form of long queues at ATMs, chaos and uncertainty, on tourists who would be in no mood to face hassles during vacation, especially in a foreign destination.
"News about long queues outside ATMs travelled fast and the next thing we received was cancellation orders from Saudi Arabia. Arrivals in November were OK since the bookings were done earlier. But cancellations started from December and the prospects for the remaining months look bleak," the Economic Times quoted Abraham George, chairman of Intersight, the largest tour operator in Kerala, as saying.
The collateral damage could be on houseboats at places such as Alappuza and Kumarakom, though the quantum of hit can be assessed only after data is published.
Though foreign tourists would have paid for their hotel bookings in advance via online and other digital modes, they do need cash for shopping at various shops. The limits on currency exchange imposed by the Reserve Bank of India (RBI) impacted them.
Agra, famous for the world-famous Taj Mahal, is witnessing a drop in domestic tourist arrivals, a factor that is adding to its worries as FTAs are already on the decline. A report in the India Today, citing Vishal Sharma of Agra Tourist Welfare Chamber, said that the comfort provided by rise in domestic tourism that used to offset lesser foreign tourist arrivals has taken a hit due to demonetisation.
It is pertinent here that the period October to March is considered tourism season in India; the snowfall in places such as Shimla, Manali, Gulmarg and Srinagar in the months of December and January, apart from an overall cool weather attracts many foreign tourists to India.
Meanwhile, raids on Indians hoarding cash and jewellery, besides those with undisclosed income, continue with a new case involving a Padma Bhushan awardee reported on Saturday.
