Home STATE CITY Rupee depreciation dents foreign travel plan of Odisha tourists

Rupee depreciation dents foreign travel plan of Odisha tourists

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Odisha Sun Times Bureau
Bhubaneswar, Sep 18:

Odisha tour operators offering international holiday packages have been feeling the pinch owing to sharp decline of rupee against dollar making foreign travel a costly affair.

Plane flight air travel

While about 20,000 travellers from Odisha used to travel abroad every year, the number has come down to 10-12,000 this year as per industry sources. Besides, given the land charges (hotel, food and travel) in US, Europe and Australia consume more than 60 per cent of the total package cost, foreign expenses shoot up making the customers spend less abroad.

“The depreciating rupee against dollar is burning a bigger hole in the pockets of middle and upper middle class tourists from Odisha travelling abroad. The worst affected entities are the tour and travel operators of the state who are under tremendous pressure to cut down on their already low profits to attract more tourists. While some of the travel firms are hiking charges to offset the impact, the response from the customers has been largely negative for them,” said Odisha head, Cox and Kings Shyama Prasad Tripathy.

However, impact is felt less in travel to Europe, Dubai and other Asian countries as land charges there are lesser as compared to USA and other countries where US Dollar is the sole mode of transaction. As per a tour package operator in the state, an average tour usually spread over seven to nine days starts from Rs 1 lakh per person in the case of Europe, while in case of Asian destinations a package starts at around Rs 20,000.

“About 60-70 percent tourists from the state go on package tours. The tourists prefer European destination over American ones to cut down on the costs,” Tripathy added.

While tickets and visa charges are paid in rupees, the hotel costs and ground transport cost at destinations are paid in foreign currency. Except for Europe, Australia-New Zealand and South Africa, travel agencies get quotations from local hotels and service providers in US dollars. As a result, a fluctuation in the dollar price impacts tour costs.

It may be noted that the exchange rate of USD to INR stood at 1:45.50 in 2011. It exchanges for 1:65.79 as per exchanges rates of today. Overall, depreciation has been 46.24 percent in last four years. In the last year itself the rupee has depreciated 7.53 percent against the US Dollar making foreign travel even more expensive.

While depreciation of rupee encourages foreign visitors to India, Odisha has not been able to score well in this front as compared to few other states such as Rajasthan, Gujarat or Kerala.