The Financial Express

Saving tourism sector  

| Updated: July 18, 2021 22:17:15

Saving tourism sector   

As it has happened globally, tourism in Bangladesh has taken the worst body blow. The loss sustained by the sector so far is to the tune of Tk 214 billion, according to an estimate. As the pandemic situation is far from getting better, the industry may be in for further shocks. Against this backdrop, 50 per cent of the tour operators have already gone out of business, say reports. Further, it is feared that 20 per cent of them may not return to business even after the pandemic is over.

Evidently, Bangladesh's tourism industry is facing an existential crisis. Some four million people and their family members who depend for their livelihood on this sector have been facing the most difficult times. According to business insiders and leaders of the Tour Operators Association of Bangladesh (TOAB), so far, the sector has not received any government-provided financial help, whether from its stimulus package or otherwise. So, it is indeed strange that such a thriving as well as a very promising sector of the economy could not benefit from the government's emergency bailout package! Worse still, seeing that the pandemic is raging leaving little prospect for the industry's early recovery, even banks have been shying from providing loan to tour operators.

Under such unhelpful circumstances, it is hoped that the government would take urgent steps to extend all-out support to the sector both financially and as part of its facilitation policy. In this context, one needs to consider the fact that tourism contributes significantly to the nation's tax revenue earning. In the fiscal (FY 2019-20), for instance, the National Board of Revenue (NBR) collected Tk 7.66 billion as travel tax from the sector. But for understandable reasons, in the last fiscal year (FY 21), the collection dwindled to less than half that amount to Tk 3.28 billion. In fact, during the last fiscal, the government's tax revenue earning from the sector had been the lowest in last five years. As such, the importance of tourism sector in the economy cannot be overemphasised. Given the reality that tourism has lost out on various state-provided assistances so far, now the government would do well to include this sector in all its ongoing arrangements including the stimulus programme to protect the industries. Alongside these, as suggested by some industry leaders, the government, as an emergency measure, can also think of making direct allocation for the sector. There are instances to support this view. For example, recently, the Indian government extended direct financial support to its tour operators as well as other stakeholders of the Indian tourism industry. In the case of Bangladesh, provision of such direct financial assistance to the local tour operators, preferably at a low rate of interest, should not be a big deal. For, there would not be thousands, but a few hundred of such recipients of financial assistance, according industry insiders.

It is to be noted at this point that the sought-after government support for the tourism sector is not something to be given out of compassion. In truth, it is an economic imperative that the government save this important service sector that employs hundreds of thousands of people and thus makes significant contribution to the economy.

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