State governments are running hotels, restaurants and resorts, purchasing boats, jetty, water scooters, etc. for so-called tourism development.
Most state governments in India own a corporation for “Tourism Development” whose function is to boost the tourism of the state by undertaking various activities. These activities include running restaurants and resorts, purchasing boats, jetty, water scooters, carrying out advertising campaigns etc. with a view to attracting tourists. Our experience indicates that such needless exercises by governments often end up wasting taxpayers’ money and do not contribute to the development of tourism.
According to a CAG report, Maharashtra Tourism Development Corporation spent our hard-earned money on multiple projects such as constructing restaurants, conference hall in a resort, upgradation of Ridhapur resort etc. However, because of lack of demand, high operational costs and other factors the projects failed to generate any revenue for the state. The report dryly noted that “the assets created at a cost of ₹12.16 crore remained idle and the chances of deterioration of these assets cannot be ruled out.”
The Odisha Tourism Development Corporation spent ₹2 crore for purchasing boats, jetty and water scooters for amusement parks. These equipment remain unutilised. The corporation also incurred a loss ₹ 7.90 crore on the operation of panthasala hotels. Only one in four hotels of the Corporation could achieve the national average occupancy level. The Corporation spent around ₹35 crore for the past 18 years for Shamuka beach project but failed it to make a tourist attraction.
Haryana Tourism Corporation suffered a loss of ₹ 35 crore from its tourist complexes between the year 2010-2015. Assam Tourism Development Corporation wasted ₹19 crore in running resorts, restaurants, and other tourist activities but failed to generate any revenue from them. In most cases, the failure of these projects emanates from lack of incentives to bureaucrats in managing businesses.
Even if these projects could make a profit, one must wonder whether it is government’s job to run restaurants and hotels? While you and I ride on pothole-filled roads, wait years and years for justice, cannot feel safe in our cities, and go through the agony of barely subsisting in perpetually planned poverty; is it ok for the babus in the government use our hard-earned money to ‘develop’ tourism?
The data collected from only 12 states shows that state governments have wasted over ₹395 crore of public money in so-called tourism development.
Do you think our governments should be running corporations for tourism development? Please let us know in comments.
