Experts like Amitabh Kant argue that India’s tourism potential is hindered by “Regulatory Density” and a lack of competitiveness.

Tourism Potential

• Rich Natural and Cultural Assets: India possesses monuments, mountains, beaches, and cuisine that make it one of the world’s richest travel destinations.
• Employment and Revenue Opportunity: Tourism has the potential to become a $1-trillion industry and generate 50 million jobs in the next decade.
• Extensive Natural Endowments: India’s coastline is three times longer than Thailand’s, and its national park area is twice that of Kenya.
• Low Foreign Tourist Arrivals: Despite these advantages, India attracts only about 10 million foreign tourists annually.

Key Constraints For the Development of the Tourism Sector

• High Cost of Tourism Services: Four-star beach hotels in Goa cost ₹12,000–₹15,000 per night, while comparable properties in Phuket or Da Nang cost about half as much.
• Excessive Regulatory Density: Tourism entrepreneurs face dozens of permission requirements, high excise charges, and lengthy approval processes.
  • Hotels require around 50 clearances, restaurants about 30, and even small operators need multiple NOCs.
• Long Project Timelines: Tourism projects take up to three years to complete approvals, compared to 18 months in Southeast Asia.
• Coastal Regulation Zone (CRZ) Restrictions: CRZ norms restrict construction within 200–500 metres of the high-tide line without distinguishing eco-resorts from large hotels.
• Monument Protection Constraints: The Ancient Monument and Archaeological Sites Remains (AMASR) Act blocks or limits development within 100-300 metres of protected monuments, regardless of scale or design.
• Uniform Environmental Clearances: Forest, wildlife, and environmental procedures apply equally to small lodges and large industrial projects.
  • Regulatory frameworks have rendered locations such as the Ganga riverbanks, Konkan beaches, Kerala backwaters, and tiger reserves largely inaccessible to sustainable investment.

Way Forward

• Shift from Regulation to Facilitation: States must move from regulation to facilitation through mission-mode execution.
• Rationalisation of Licences: At least 10 licences should be simplified, six scrapped, and 10 merged as per the Atithi Foundation report.
  • Example: Eating House and Health Trade licences duplicating FSSAI approval should be eliminated.
• Unified Municipal Licence: A Unified Municipal Licence should replace multiple trade licences for hospitality establishments.
• Risk-Based Fire Safety Approvals: States should issue provisional NoCs within 7 days for low-risk units and make full certificates valid for 5-10 years, using accredited third parties to expand capacity and curb delays.
• Rationalise Pollution Classification: Pollution categories should be updated so that clean, solar-powered hotels that use LPG and practice proper waste management are classified as “green” or “white,” rather than treated as highly polluting “orange” or “red” industries.
• Expansion of Homestay Capacity: Homestay room limits should be increased to eight, and owner-residency requirements should be removed, while maintaining safety norms.
  • Small homestays should not require separate NOCs from multiple departments.
• Regulated Access for Tourist Transport: Private tourist buses should be allowed regulated access to government-owned Inter-State Bus Terminals (ISBTs).
• Uniform Implementation of Tourist Permits: The All India Tourist Permit should be uniformly implemented across states.
  • Harmonisation will boost inter-state circuits and lower costs.
• Single-Window Approval for Adventure Tourism: A single online portal should integrate approvals for adventure and water-based tourism.
• Competitive Federalism in Tourism Reform: Tourism is a state subject, which means reform can thrive through competitive federalism.
  • States such as Goa, Himachal Pradesh, and Rajasthan have already piloted unified hospitality licences and online single-window clearances.
  • Other states can go further by introducing automatic renewals, waiving fees for micro-operators, and digitising all approvals.

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Conclusion

Tourism growth requires deregulation. Entrepreneurs are ready, and governments must clear the way to boost investment, jobs, and global recognition.

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