Increased Uncertainty Over Indian Eco Tourism Projects

During the 2012 Partnership Summit organised by the Confederation of Indian Industry (CII) a lot of eco friendly tourism projects were signed and promoted with much fanfare. Unfortunately soon after it already looking as some of these are in doubt.

It was very successfull and the Indian Government attracted initial investment worth many millions of Rupees.There wre 12 projects including five extremely large projects which were outlined during the summit. One of the biggest was an Eco Tourism project near Vikarabad, being run by Malaxmi Industries Ltd.Other similar sized projects are being run by a variety of Indian and Internation companies.For example one project was the setting up of a mythological theme park at Tirupati.

It all sounds really encouraging for the communities involved. However some apprehension exists over whether they woudl happen at all. The major problem is that funding is dependent on the grant of Infrastructure status to these Tourism projects.It is a crucial stage, as once granted the projects will have much easier access to loans from various financial insititutions. One commentator who wished to remain anonymous suggested that without this status the projects would simply collapse with insufficient funding. The status would also enable other entrepreneurs to get involved due to the tax advantages that are applied to infrastructure projects.

It is interesting that many of  the commentators and critics of this situation were so concerned about maintaining their anonymity.   Few people were prepared to speak on the record and others used various anonymity devices including encrypting voice and data when communicating see –   Whether this points to something more sinister it is unclear, it certainly doesn’t inspire confidence in the transparency of the projects.

There have been several assurances given that this status would be applied but there seems to be little activity in making it happen.

The problem is that it is difficult currently to raise money for eco tourism and hotel projects because of the way they are viewed alongside tradition real estate projects.Simply put – Banks are unwilling to give loans and support to an Eco Tourism project without some sort of assurances.In order for these eco tourism projects to proceed, the Indian Government needs to show it’s support of these tourist projects particularly the ones with a strong environmental bias.

Tourism is actually a huge employer in India and these projects are essential to develop a sustainable sector. The growth of eco travel and tourism is set to grow and India is currently poorly placed to benefit from this sector despite having huge natural advantages in this area.


There was some additional coverage of this issue in the media last week (10/12/13) it was mainly on the Irish National broadcaster RTE, which is accessible online using this link and method.

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