Cut in Budgetary allocation will jeopardise tourism: House panel

‘147.42 cr. shortfall due to broad cuts by Finance Ministry’

The Finance Ministry’s move to cut down the budgetary allocation for the Tourism Ministry in the upcoming financial year will ‘seriously jeopardise’ the targeted tourism outcomes during 2020-21, a Parliamentary panel has said in its report.

In the Union Budget 2020-21, the Tourism Ministry has witnessed a reduction in allocation of funds due to “broad budgetary cuts imposed by the Ministry of Finance”, and has been allocated ₹2,499.83 crore as against its projected demand of ₹2,647.25 crore, leading to a shortfall of ₹147.42 crore.

Noting that less allocation as compared to the projected demand was not unique to FY2020-21, the panel pointed out that against the projected demands of ₹4,320.42 crore and ₹4,612.18 crore for FY2018-19 and 2019-20, respectively, the Ministry of Finance provided ₹2,150.00 crore and ₹2,189.22 crore in budget estimates (BE) 2018-19 and BE 2019-20, which was further reduced to ₹2,113.48 crore and ₹1,416.00 crore as revised estimates (RE) 2018-19 and RE 2019-20 stages, respectively.

“The committee notes with dismay the huge mismatch between the projected demand for funds and actual allocations made for the Ministry of Tourism for the years 2018-19 and 2019-20 as well,” the report said.

The Parliamentary Panel also hit out at the ministry, stating that the pattern of shortfall in allocation of funds indicated that budgetary requirements were being projected by the ministry more on the basis of theoretical anticipation rather than on actual trend of requirement.

In its analyses of the Budget, the panel added that since development of tourism infrastructure was capital intensive, the budgetary allocation of ₹2,499.83 crore for the upcoming fiscal “was low” and it would be difficult for the Ministry to take up significant activities related to on-going infrastructure development with this budget.

The Ministry in its submission to the Committee has pointed out that the difference in the projection made by it and the allocation given is not high, and if additional funds are required, it would move the Ministry of Finance for additional allocation at the RE 2020-21 stage.

Stating that availability of adequate resources to the tourism sector is sine qua non for achieving the tourism growth as well as inclusive growth, the committee asked the Ministry of Tourism to bring the above recommendation to the notice of Ministry of Finance and also intimate the committee its response.

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