The Role of Tourism in Economic Development

Tourism plays a very crucial role in the world economy, and it became an efficient tool for promoting economic growth. For many countries tourism is considered as a main instrument for regional development, as it encourages new economic activities. It can have a positive economic impact on the balance of payments, employment, gross income and production, but it may also have a negative effects, especially on the environment. The environment, being the major source of tourist product, should be protected in order to have further growth of tourism and economic development in the future. Tourism industry has arrived as one of the best service industries in the global economy in recent decades. Economic flows generated by international tourism have become vital factors in economic growth and international economic relations in many developing countries.

Travel and tourism’s growth

According to the World Tourism Organization (2010), as a result there is a constant increasing number of destinations opening up and investing in tourism development, modern tourism has develop into a key driver for socio-economic progress through the creation of jobs and business, infrastructure development, and the export revenues earned. Tourism achieves a vital amount of foreign exchange earnings that commits to the continuous economic growth and development of developing countries. It also provides jobs for the local residents, further benefiting the destination. The growth in the tourism industry is due to the arrival of more and more foreign tourists and the increase in the number of domestic tourists.

 The Government of India has well-established the Ministry of Tourism in order to improve Tourism in India, and it also undertaken many projects to promote India as a perfect Tourist destination and create a visitor-friendly appearance of the country. The main steps taken by the Government were the Atithi Devo Bhavah Campaign which gave a wide spread message of “honour your Guest as he is always equivalent to God” and the Incredible India Campaign which was incredibly successful in creating a colorful and a gorgeous model of our country as a perfect holiday destination. Tourism is not only a growth engine and it is also an employment generator. It also provides 6-7% of the world’s total jobs directly and millions more indirectly over the multiplier effect as per the UN’s World Tourism Organization (UNWTO).

Travel and tourism’s contribution to GDP

 India ranks 14th in the world in form of its tourism sector’s contribution to the GDP Tourism can provide direct and indirect benefit to a nation’s economy. Direct benefits consist of economic support for hotels, retail shops, transportation services, entertainment venues and attractions, while indirect benefits include government spending on related infrastructure, plus the domestic spending of Indians employed in the tourism sector.

Impacts of tourism on the economy

In India Tourism industry has several positive and negative impacts on the economy and society. Tourism can lead to many economic and social benefits, mainly in rural areas and developing countries. Thus the tourism sector has become increasingly important industry as a source of revenue as well as a source of employment in developing countries.  eTravos  is  one of the best travel industry which  provide travel  services like travel portal software, mobile app, Api integrations with features of Flights, Hotel, Buses, Cabs, Holiday packages booking facility. 

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