Kerala Tourism — The Role of the Government and Economic Impacts

Executive Summary

Kerala tourism has won several national and international recognitions, mainly due to the region’s picturesque beauty and state’s responsible tourism projects. Based on the tourism policy documents of the central and state governments, the Kerala tourism model is acclaimed as one of the most liberalised tourism models with the private sector leading tourism development and the state acting as a facilitator rather than a regulator. Kerala government’s tourism expenditure is one among the highest in the country. Tourism constitutes 10 per cent of Kerala’s GDP, as per official statistics, and reportedly contributes around 23.5 per cent to the total employment in the state. This study, however, shows that most of the claims made by the government about Kerala tourism are inflated.

Though found to be highly unsuccessful and ineffective, the government has spent a significant amount of money on government-run tourism services. The government plays the role of the lead provider of accommodation facilities and is in complete charge of tourism promotion and marketing. At the same time, the potential of innovative products like home stays and houseboats is not tapped for lack of incentives to the entrepreneurs. This study shows that though the government policies were investor friendly in paper, they were actually harming the investors rather than promoting them. Kerala’s international tourism sustains on visitors from a few countries, while domestic tourism is dependent on tourists from within the state, despite the huge spending on tourism promotion by the government. The claims of the economic advantages of tourism are based on unreliable statistics, along with an all-inclusive definition of tourists, which do not come under the realm of the state’s tourism policy.

The study shows the need for the government to act as a facilitator by providing the basic infrastructure conducive for tourism and allow the private sector to play the lead role in tourism promotion and development. Tourism promotion and marketing should be the responsibility of the private sector, which will help in implementing innovative marketing methods for attracting international tourists from more countries and domestic tourists from other states. This will help in exploiting the natural potential of Kerala tourism rather than placing artificial constraints on tourism development in the state through government interventions. The study demands a reliable procedure for collating the tourist database in the state that distinguishes tourists based on the type of visa and purpose of visit. The economic impacts of tourism should be analysed using this database for getting a reliable picture in this regard.

Click here to read the study: Kerala Tourism – The Role of the Government and Economic Impacts

The study is conducted by Dr Leskhmi R Nair (Research Consultant, CPPR) and D Dhanuraj (Chairman, CPPR)

Dr. Lekshmi Nair
Dr. Lekshmi Nair
Dr Lekhmi Nair was Research Consultant with CPPR. She has a PhD (Economics) and MPhil (Applied Economics)  from JNU/CDS Trivandrum and a Masters in Statistics.

1 Comment

  1. faseeh says:

    tourism is the one of the best earnings in kerala development

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