Contribution to foreign exchange earnings from tourism

yossie · tadpole Number of posts: 1 Location: cochin Registration date: 2009-07-03

Tourism is perhaps the only ‘marketed’ or ‘marketable’ product which
results in enormous transfer of funds.
Even though this industry in India is short of foreign grants, it can
bring valuable foreign exchange to the country and particularly a state like
Kerala, without any exchange or export of merchandise. During the period 1951-2001, India achieved a
compound growth rate of 16.2 percent in foreign exchange earnings as against
the world average of 13.5 percent. Due
to the increase in the number of tourists going out on a
holiday Kerala

also could gain much particularly after the liberalization of the Indian
economy. While the international tourist
is now flocking to the beach resorts in the state and also the houseboats in
the backwaters, the domestic tourist is also now emerging as a major customer
due to the availability of extra money in their hands.

Income from international tourism can be phenomenal in the form of
foreign exchange earnings. It adds to
the national income and, as an invisible export, may offset a loss on the
visible trading account, and will be of critical importance in the overall
financial reckoning. This is truer in
the case of developing countries like India.
Foreign exchange earnings as a percentage of the total invisible
earnings in India are continuously increasing with each passing year.

For many developing countries, which are mainly dependent upon primary
products such as a few basic cash crops, tourism offers a more reliable form of
income. In the case of some European
countries like Spain, Portugal, Austria, Yugoslavia and Greece, the invisible
earnings from tourism are of a major significance and have a very strong
positive effect on the balance of payments.

Tourism has totally reshaped the economies of Japan, Hong Kong, Italy,
France, Singapore and Mauritius. Even
countries in Eastern Europe which were shy and hesitant in the beginning, have
now accepted the basic philosophy underlying tourism and have liberalized rules
and regulations to allow free flow of tourist traffic from abroad.