India tourism suffers a blow at beginning of the high season

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As the dust settles on the terrorist attacks that devastated Mumbai last week, the travel industry is assessing the damage the attacks will have on travel and tourism to India.

Manav Thadani, managing director for hospitality consulting firm HVS India, noted that the attacks occurred during India’s peak tourism season, October to March.

"There is already an impact because of the economy. Business travel across India is down," said Thadani. "All the group travel is going to disappear. It is the high season, so we should have been running at 90 to 95% [occupancy] between now and February. Now we will probably run at half that."

The U.S. State Department issued an India travel alert on Saturday, advising against travel to Mumbai. The alert expires on Dec. 31.

"While terrorist attacks are not new to India, the Nov. 26 Mumbai terrorist attacks in part targeted American citizens and other westerners for the first time and tragically demonstrate that even in five-star luxury hotels, security is not equipped to deter such attacks," said the State Department. "U.S. citizens should take into account this new reality and exercise caution when visiting India. … Emotions are running high and there are possibilities of demonstrations which could turn violent."

Ashish Sanghrajka, president of Big Five Tours and Expeditions, said he expects that the company's itineraries won’t include Mumbai for the next six months. Big Five clients who already have booked India tours have three options: postponing their trip, rerouting their trip around Mumbai or changing the destination entirely.

Sanghrajka said that some clients are canceling or postponing their trips to India.

Big Five had about 60 customers traveling throughout India at the time of the attack, though none were in Mumbai. Sanghrajka said he had been in touch with all of them personally, and that the company had called customers scheduled to visit India in the next several months.

Big Five does contract with both the Taj and Oberoi hotels in Mumbai, where Islamic terrorists armed with assault rifles and grenades killed guests and employees. Explosions caused fires at both luxury hotels.

Sanghrajka said Big Five plans to recontract with the hotels once they reopen.

Ken Fish, president and owner of upscale operator Absolute Travel said that he has not had any India cancellations following the attacks.

"Mumbai is not a major tourism destination for our clients. It is generally an entry or exit point and can easily be avoided if necessary," said Fish. "Most of our clients spend their time in northern India: Delhi, Agra, Jaipur, Udaipur, etc. Right now, we are advising clients who are departing more than two weeks from now to be patient as we assess the situation. We will, of course, make arrangements without penalty for anyone who wishes to postpone their travel but we have not had anyone do so yet."

Effect on biz travel

The Association of Corporate Travel Executives (ACTE) predicted a temporary drop in business travel to India in the wake of terrorist attacks.

"However, the situation remains fluid, and companies will be looking at the overall response by Indian security forces and the potential of a sectarian backlash before making any long-term travel decisions," said Susan Gurley, ACTE’s executive director.

Most companies that are ACTE members have security programs in place, she said, but inital reports indicate those with business interests in India reviewing their security plans, which include safe houses and evacuation procedures in the event of terrorist acts or civil unrest.

Gurley said members are reevaluating security plans in light of problems reported by hostages who said they could not get news because of failed cable systems and dead phone lines. Yet, one guest was in contact via cell phone with his company's travel department and with a news agency, she said.

"This will put a new emphasis on the need to travel with a reliable flashlight, a small self-powered radio and a cell phone with international capabilities," Gurley said.

ACTE still intends to hold scheduled education sessions in India in 2009.

Nadine Godwin contributed to this report.

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