Thomas Cook collapse could hit India's Inbound Travel
With British travel giant Thomas Cook going belly up, India's inbound travel could be severely hit and hence adversely impact foreign exchange (forex) earnings too in the months to come.
Travel industry sources said that Thomas Cook sends a lot of high-spending tourists to India from countries such as UK, Germany and France. Countries like UK, Germany and Italy where Thomas Cook has a good presence are the key source markets for India.
"The shutdown of Thomas Cook would certainly impact inbound travel. The whole travel industry is struggling," said Harjinder Singh, Director of Delhi-based 24*7 Travels.com.
As per the latest official data, UK's share in India's total foreign tourist arrivals (FTAs) was 8.01 per cent in August 2019.
Among the top European source markets, German tourists accounted for 1.85 per cent of the total FTAs in the previous month. The total FTAs in August 2019 were 7,98,587 as compared to 7,86,003 in August 2018, registering a growth of 1.6 per cent.
With global slowdown casting its shadow on travel business, the FTA growth is likely to be tepid in coming months. With Thomas Cook, one of the world's top travel firms, going bankrupt, the travel business is certainly going to see a tough time.
While Thomas Cook India is a completely separate entity from Thomas Cook UK post its acquisition in 2012 by Canada-based Fairfax Financial Holdings, reaching out to each wary customer following the recent development would not be easy for the Indian firm.
"With the recent developments relating to the iconic British Travel Company, Thomas Cook PLC, being reported in the media, it is imperative to highlight that Thomas Cook India Group is a completely different entity since August 2012 when it was acquired by Fairfax Financial Holdings (Fairfax), a Canada-based multinational with varied interests across the globe as well as in India," Thomas Cook India said in a statement to allay fears of its clients and customers.
An industry insider, however, said it is a big task for Thomas Cook India to convince common people that it is not related to the ailing UK travel firm.
Madhavan Menon, Chairman and Managing Director, Thomas Cook (India), however expects other tour operators in the UK to fill the gap and said that the situation would settle down in the "medium term".
Speaking to IANS, Menon said: "In the UK, I expect that other tour operators will take up the capacity. It will not be a problem, there are many tour operators."
"In the immediate terms there may be rise in prices... or the yields for the tour operators in UK, but in the medium term I expect things to settle down," he added.