Nepali Times
Economic Sense
Waning Shangri-la


The tourism statistics for 2000 are trickling in and the picture is bleak. Tourist arrivals have gone down by 11 percent, mainly due to a decline in tourists coming from India. (That figure itself is down by 31 percent.) The underlying factors are not just the aftermath of the hijacking or the frequent bandhs, or even the riots. The basic question is-why should anyone really come to Nepal? What are we doing right?

A recent Pacific Area Travel Association (PATA) publication contained a comparative study of the tourist arrivals in PATA countries in 1999 and 2000. Tourist arrivals to South Asia increased by 3.6 percent in 2000 compared to an increase of 18.1 percent in Northeast Asia and 14.5 percent in Southeast Asia. Malaysia registered the highest growth with an increase of nearly 50 percent in one year. Newer destinations like Cambodia and Laos have recorded growth of 39 percent and 26 percent respectively. It is sad-and telling-that when the entire industry is registering growth in the region, there has been a steep decline in the number of tourists coming to Nepal.

Nepal has never really been marketed as a destination anyway, and with problems of all crazy kinds constantly plaguing the tourism industry, the travel trade across the worlds is losing interest in us. Surveys repeatedly show us that Nepal is mainly a destination for first timers. Repeat visits are low. The average revenue per tourist per day has remained at $38 since 1980.

The major concern of course is the Indian market. We rely too much on Pashupatinath to keep the Indians coming. But in fact there are now many places they can go to relatively easily. The relaxed foreign currency rules coupled with strong marketing by other destinations means the Indian tourist is looking far beyond Nepal. And airfare between Kathmandu and major Indian cities is becoming increasingly more expensive than other competitive destinations. In 2000 the number of Indians travelling to Thailand doubled and to Malaysia tripled. What's more, the total number of outbound tourists in India went up by 6.2 percent. We're losing out in every respect.

The government still doesn't take tourism as an industry. Over the last decade we've created over-capacity-1.5 million rooms chasing 400,000 arrivals. The free market has gone too far, while also forgetting to provide tourists anything more than the Kathmandu-Pokhara-Chitwan triangle. People will not keeping coming just because "we have Everest".

Take Malaysians-they've been doing a great job marketing their country. Their tourism minister visits India every six months and does his job. In comparison, we have a Ministry that only understands airline deals and a Nepal Tourism Board that is quasi-defunct. The fact that there have been no nominees to the Board for several months shows exactly where tourism stands (or doesn't) on the government's list of priorities. The Board chases the Indian market with an advertisement budget of Rs 9 million, not very much at all, but then it doesn't seem as if they have high aims either-just log on to their website (

The situation is grave and the impact of a languishing tourism industry affects 15 percent of our workforce, and a million who are dependent on this industry. The place to start is curtailing the supply situation-just don't allow any new hotel- or travel-related business to be started in areas that are already crowded. Offer incentives to promote the planned spread of tourism to places as-yet low on the totem pole. And hope that the private sector becomes pro-active. All of us have a role to play in uplifting this waning Shangrila.

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(11 JAN 2013 - 17 JAN 2013)