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MICE Tourism Part II

Business travellers from India

mice business conventionWith the burgeoning of Indian enterprise, Indian business persons are becoming more globally aware and are increasingly seeking a presence at trade fairs and conventions across the world. Europe in particular is attracting huge numbers of Indian exhibitors and visitors. Formerly, the restrictions on foreign exchange were a big deterrent. In the 1970s, you could carry just US $ 100 in foreign exchange for travelling overseas. Also, for business travel, carrying foreign exchange was a big hassle as a number of documents would have to be provided to RBI for clearance – a formality that could take up to two months to complete.

It was only after the liberalization of the economy in the early 1990s that MICE travel got a boost in India. Easier rules for conversion to foreign exchange were introduced and much larger allowances were permitted. The new rules in turn triggered the development of the services sector and also led to an increase in foreign direct investment in India. At present, though still in its nascent stage, the Indian MICE tourism segment is growing rapidly.

What MICE destinations offer

Some of the factors that lure Indians to international MICE destinations include:

  • Value for money: Destinations like Sri Lanka, Thailand, Dubai and others have reduced their costs to provide an attractive option to Indian domestic destinations.
  • Close proximity: Dubai, Sri Lanka, Malaysia, Thailand and Mauritius are just a few hours away.
  • Accessibility: Different airlines have increased the frequency of their flights and added on more seats, so now Indian travellers have easy connectivity to several international destinations. Besides, many airlines now have convenient flights that enable passengers from India to reach even far off destinations within the same day thus saving them precious time.
  • Proactive tourism boards: The tourism boards of many countries are very proactive in the Indian market. They regularly participate in trade shows and conventions here to market their countries as attractive MICE destinations by offering advice regarding accommodation, venues, transportation and other services. They also offer Indian business travellers a plethora of incentives such as preferential airfares, accommodation, transportation facilities and help with custom and immigration clearances.
  • Tourist attractions: Leisure-starved MICE travellers find the lure of the many attractions of foreign destinations such as theme parks, spas and beaches hard to resist.
  • Excellent infrastructure: MICE participants are always drawn towards destinations with excellent infrastructure such as smooth roads and top quality transportation.
  • Hassle-free visa regulations: Countries like Sri Lanka and Thailand provide visas on arrival for Indians.

But of all the different MICE segments, the incentive travel segment is the most popular in India. Employees achieving smaller targets get to enjoy vacations at domestic locations, while those achieving substantially larger targets are rewarded with foreign travel. One of the main reasons why corporates spend on this segment is that an executive travelling abroad, whether to attend a conference / exhibition or even on a holiday, is bound to strike business opportunities during the visit.

While the incentives segment is ahead in the race, the other aspects of MICE are not far behind. A number of Indian business groups and exporters regularly participate in international exhibitions and trade fairs related to consumer products, handicrafts and jewellery. Such activities help them in launching new products, attracting new clients, increasing sales, and exchanging useful information.

Promoting MICE in India

Today, the outbound MICE sector is picking up and is poised for further growth. But we still have a long way to go where the inbound MICE segment is concerned. Although business travel has more or less arrived in India, it is in the MICE sub-sector that we are lagging behind. And in comparison to other countries, even smaller ones like Singapore and Dubai, India cuts a sorry figure. Hence there is an urgent need to promote MICE in India.

MICE miscellany

Incentives are the most popular MICE segment in India.
Most Indian companies prefer South East Asian countries and Dubai for a convention as the cost is just 10-12% higher than organizing one in India.
The top 10 convention countries in the world are all in Europe and North America.
Singapore is Asia’s top convention centre.

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2 comments

  1. Bipin chandra pant-Asstt Professor(tourism & hospitality)

    Challenges for MICE Tourism Industry in India

    • First and foremost, lack of proper infrastructure discourages every visitor. Lack of proper transport and housing/lodging facilities in and around several of the prime heritage spots in India is a major hurdle. The almost complete lack of good restaurants and hotels at tourist places other than the Metropolitan cities in India is a major issue as the foreigners find it very hard to relate to the so-proclaimed “safe overnight stoppages”.

    • Another issue is the absence of awareness and initiative among the general masses about the value of the tourism industry in India. The general public often undoes the effort put in by the government by harassing the tourists and by misleading them economically. Cases of foreigners being severely exploited economically and sexually are reported each year.

    • The complete irreverence to the historical architecture and monuments in many cases is another factor which is an irritant for our foreign visitors.

    • Improper marketing and promotion of least visited MICE tourism destinations is another challenge, which the stakeholders face. There is an ardent need to promote the least visited MICE tourism sites across India to attract more foreign and domestic tourists.

    • Availability of skilled manpower is one of the major challenges faced by the travel and tourism industry. To sustain growth in the MICE tourism industry, trained manpower/workforce is required at every level — managerial, supervisory, skilled or semi-skilled.

    • Travel & tourism is a high taxed industry, which makes India expensive as a MICE tourist destination. Inbound tourism is most adversely affected by the tax structure. Taxes including service tax, luxury tax, entertainment tax, sale tax ,taxes on transportation and aviation turbine fuel are levied across the sector-on tour operators, transporters, airline industry, hotels etc. In addition, these tax rates tend to vary across different states in the country.

    • Unfortunately a lot of what you’ve mentioned is true. Things take longer to happen in India but let’s hope things will turn around soon where the tourism industry is concerned.