Content

1. India’s Tourism Paradox — Potential Without Performance
2. India–EU FTA — A Case of Mature and Pragmatic Negotiation

India’s Tourism Paradox — Potential Without Performance

Context

• Despite unparalleled natural, cultural, and civilisational diversity, India attracted only 5.6 million foreign tourist arrivals (FTAs) till August 2025, far below global peers with smaller size and resources.
• Comparative underperformance is stark: Singapore received 11.6 million FTAs, while Thailand earned over $60 billion from tourism, highlighting India’s unrealised economic and strategic potential.

Relevance

• GS Paper I (Society & Urbanisation):
  Women safety, sanitation, service culture, urban crowding, sustainable tourism in fragile regions, cultural preservation, community-based livelihoods.
• GS Paper II (Governance):
  Public service delivery, image management as soft power, immigration reforms, cooperative federalism in tourism circuits, role of state capacity and regulatory facilitation.

Practice Question

• Despite immense natural and cultural endowments, India has underperformed as a global tourism destination.Analyse the structural and governance-related constraints behind this paradox and suggest measures to unlock tourism as a strategic growth sector.
  (250 words)

Background — Why Tourism Matters ?

• Tourism is a high employment-multiplier sector, generating more jobs per unit investment than manufacturing, especially benefiting unskilled and semi-skilled workers.
• According to World Tourism Organization, tourism-led growth supports inclusive development, regional balance, and social stability in youth-heavy economies.

The Three ‘I’s Holding India Back – 1.Image Deficit

Perception vs Reality

• India’s global image is shaped less by its heritage and more by concerns around women’s safety, sanitation, scams, bureaucratic hurdles, and inconsistent tourist experiences.
• Branding campaigns like Incredible India cannot offset repeated negative narratives unless safety, predictability, and ease of travel improve on the ground.

Need for Segmented Branding

• India’s vast diversity requires multiple targeted narratives — Spiritual India, Adventure India, Luxury India — marketed distinctly to specific international audiences.
• Thematic circuits such as Buddhist, Ramayana, Himalayan, Coastal, and Cricket circuits offer scalable, story-driven tourism products with global appeal.

Infrastructure Gap

First and Last Impressions Matter

• Tourist experience begins at airports, immigration counters, roads, signage, Wi-Fi, and sanitation, where inconsistency erodes perceived value.
• Poor last-mile connectivity, inadequate public toilets, and under-maintained heritage sites dilute gains from premium hotels or iconic attractions.

Cost Competitiveness Paradox

• While India is marketed as a budget destination, mid-range and luxury travel often costs more than Southeast Asia, reducing competitiveness in high-spending segments.

India Itself’ — Experience Management Challenge

Scale and Service Culture

• Crowds, noise, touts, scams, and harassment overwhelm first-time visitors, creating trust deficits and discouraging repeat tourism.
• Hospitality sector faces a ~40% shortage of trained personnel, with limited vocational appeal and weak professionalisation of tourism services.

Immigration as Soft Power Interface

• Although e-visas improved access, India lags in ease-of-travel indices due to discretionary immigration practices and inconsistent visitor treatment.
• Denial of entry based on past criticism undermines India’s democratic confidence and damages its international image disproportionately.

Fixing the Deficit — A Multi-Pronged Strategy

Rebrand with Precision

• Shift from generic messaging to targeted, circuit-based branding, supported by digital storytelling, virtual tours, influencer partnerships, and authentic user-generated content.
• Tourism branding should sell experiences, not monuments, positioning India as a world to inhabit, not merely a destination to visit.

Infrastructure That Matches Ambition

• Expand public–private partnerships through schemes like Adopt a Heritage for site maintenance, digital museums, and visitor amenities.
• Launch a nationwide Clean Tourism Mission focusing on toilets, signage, waste management, and sustainable transport at all major destinations.

Safety, Skills, and Service Quality

• Scale up tourist police, especially women officers; enforce strict action against scams and harassment; provide multilingual helplines and verified service platforms.
• Invest in vocational training, local guides, homestays, eco-tourism operators, and artisans to professionalise grassroots tourism.

Visa and Regulatory Reforms

• Simplify and fast-track e-visa processes, explore selective visa-on-arrival, and offer long-term multi-entry visas for repeat travellers.
• Shift immigration culture from gatekeeping to facilitation, recognising tourism as soft power diplomacy.

Sustainability and Authenticity

• Regulate footfalls at fragile sites, promote community-based tourism, and ensure ecological and cultural preservation alongside growth.
• Align tourism expansion with climate resilience, local livelihoods, and cultural integrity.

Economic Opportunity and Strategic Imperative

Jobs, Stability, and Growth

• Tourism can absorb India’s growing workforce amid automation-driven job losses in manufacturing, particularly in youth-dense regions vulnerable to unrest.
• Strategic tourism investment strengthens economic resilience, regional stability, and India’s global influence.

Policy Coherence Needed

• GST structure has unintentionally hurt hospitality by denying full input tax credit, making hotels worse off at lower nominal rates — a distortion needing urgent correction.
• Treat tourism as a core industry, not a peripheral service, with tax rationalisation, policy incentives, and institutional support.

Conclusion

• India does not lack attractions; it lacks consistency, coordination, and experience management across the tourism value chain.
• Refining image, infrastructure, and service culture can convert India from a tantalising idea into a top-tier global destination — the world is ready; India must be too.

Data & Facts for Use in Answers

• Visa facilitation can raise tourist inflows by 5–25% globally (UN tourism studies).
• India recorded 5.6 million FTAs (till Aug 2025) despite vast natural and cultural diversity.
• Singapore received 11.6 million FTAs (till Aug 2025) with a population smaller than Delhi.
• Thailand earns USD 60+ billion annually from tourism; India earns less than one-third of that.
• Tourism generates more jobs per unit investment than manufacturing (UNWTO).
• Tourism supports 1 in 10 jobs globally and contributes ~7–8% of global GDP.
• India faces ~40% shortage of trained hospitality manpower.
• India lags Southeast Asia on ease of travel indices due to sanitation, connectivity, and service quality gaps.

India–EU FTA — A Case of Mature and Pragmatic Negotiation

Context

• India has concluded a Free Trade Agreement with the European Union, a significant milestone given the scale, complexity, and negotiating asymmetry between the two economies.
• The agreement comes after prolonged negotiations, earlier stalled in 2013, particularly over automobiles, and amid rising global trade fragmentation and protectionism.

Relevance

• GS Paper II (International Relations):
  India–EU relations, trade diplomacy, negotiation strategy with major economic blocs, balancing national interest with global economic integration.
• GS Paper III (Economy):
  Foreign trade policy, FTAs and their impact, manufacturing competitiveness, CBAM challenges, export-led growth, integration into global value chains.

Practice Question

• The India–EU Free Trade Agreement reflects a shift from defensive trade policy to calibrated openness.Discuss the key gains, unresolved concerns, and conditions necessary for India to fully realise the strategic and economic benefits of the agreement.(250 words)

Background — Why the India–EU FTA Matters ?

• The European Union accounts for nearly 12% of India’s total trade, compared to about 16% combined share of India’s other eight FTAs signed over the past four years.
• Unlike previous FTAs with smaller partners, this deal tests India’s capacity to negotiate with a large, rules-intensive, and politically complex trading bloc.

Core Strength — Negotiating Maturity and Balance

Market Access Gains

EU Concessions

• The EU has agreed to eliminate tariffs on 99.5% of India’s exports, with most lines moving to zero duty immediately, significantly improving India’s export competitiveness.

India’s Reciprocal Commitments

• India has offered tariff concessions on 97.5% of EU exports, reflecting reciprocity while carefully sequencing liberalisation to protect sensitive domestic sectors.

Protection of Strategic Interests

Agriculture and Dairy

• India successfully excluded sensitive agricultural sectors and dairy, preserving farmer livelihoods and food security, while the EU also protected its own vulnerable farm segments.

Automobiles — From Deadlock to Design

• Earlier negotiations collapsed over autos; the current quota-based tariff system protects India’s mass-market manufacturers while opening controlled access for European luxury carmakers.

Wine and Spirits

• Quota-based concessions on wine meet long-standing EU demands, particularly from France, while shielding India’s nascent domestic wine industry from sudden import surges.

Beyond Tariffs — Strategic Complementarity

• Parallel agreements on mobility, defence cooperation, and technology signal a broader strategic partnership, moving the relationship beyond transactional trade liberalisation.

Key Concerns and Structural Challenges

Carbon Border Adjustment Mechanism (CBAM)

Unresolved Cost Pressure

• India could not secure exemptions from the EU’s Carbon Border Adjustment Mechanism, which currently covers six products but is designed to expand across industrial goods.

Partial Mitigation

• India negotiated a most-favoured treatment clause, ensuring that any CBAM concession extended to another country would automatically apply to India.

Manufacturing Readiness

• To leverage the FTA as an export platform, India must accelerate large-scale manufacturing reforms, including logistics efficiency, scale economies, and regulatory predictability.
• Without domestic capacity expansion, tariff concessions alone may not translate into sustained export growth or FDI inflows.

Implementation Lag

• The FTA must be translated into 27 European languages, approved by individual EU members, and ratified by the European Parliament, delaying on-ground benefits.
• Prolonged ratification risks diluting the agreement’s relevance, especially as India faces tariff pressures from the United States.

Strategic Assessment : What the Deal Signals ?

• The agreement reflects India’s evolution from a defensive trade posture to calibrated openness, combining market access with sectoral safeguards.
• It demonstrates India’s ability to negotiate rules-based trade without surrendering policy space, a key requirement for a large developing economy.

Way Forward

• India should push for expedited EU ratification, align domestic manufacturing and logistics reforms with export opportunities, and proactively prepare for CBAM through green industrial transitions.
• Continuous review mechanisms will be essential to ensure that negotiated gains translate into real trade flows, investment, and technology transfer.

Conclusion

• The India–EU FTA is not flawless, but it is balanced, realistic, and strategically sound, reflecting negotiation maturity rather than headline-driven liberalisation.
• In an era of geopolitical trade realignments, the agreement positions India as a credible, confident, and pragmatic economic partner, provided implementation keeps pace with ambition.

Data & Facts for Use in Answers

• EU accounts for ~12% of India’s total trade, India’s largest trade bloc partner.
• India’s other 8 FTAs together account for ~16% of total trade.
• EU will eliminate tariffs on 99.5% of India’s exports, most to zero duty immediately.
• India offered tariff concessions on 97.5% of EU exports, with key sectoral safeguards.
• Agriculture and dairy excluded by India from tariff liberalisation.
• Automobiles and wine addressed through quota-based tariff systems.
• CBAM currently covers 6 sectors, designed to expand to all industrial goods.
• India secured MFN parity on any future CBAM concessions.
• Manufacturing remains ~15–16% of GDP; logistics costs ~13–14% of GDP.
• FTA requires ratification across 27 EU member states + European Parliament.