The Hindu : Business : Major industries doing well: CII

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Friday, Nov 02, 2007
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Major industries doing well: CII

Special Correspondent

Tourism registers rapid growth

Kochi: Kerala’s tourism industry registered an impressive performance during April-September, 2007, says the bi-annual Industry Monitor Survey conducted by the Confederation of Indian Industry (CII), Southern Region.

CII conducts the survey for top five sectors of each southern region States to identify the industry’s performance for the first half and the outlook for the second half of each financial year. CII’s study for April-September 2007 surveyed the key sectors of Kerala — coir, chemicals and fertilizers, food processing, rubber and tourism — the top five contributors to Kerala’s Gross State Domestic Product.

The tourism industry in Kerala witnessed rapid growth during April- March 2007. The inflow of domestic tourists has increased by 40-50 per cent and that of foreign tourists by 20- 30 per cent, resulting peak occupancy rate and increased revenue to the tune of 20-25 per cent during the same period. The pricing has also increased by 10-15 per cent, which coupled with other factors like increased tourists inflow and increased occupancy, resulted in a 15 per cent increase in profit margins. The industry employment level has also gone up by 15-20 per cent during the same period.

Bad roads

The industry demand, inflow of tourists, occupancy rate and hence, the industry revenues are expected to continue to increase by 40-50 per cent in the case of domestic tourists and 20-30 per cent for foreign tourists during the October 2007 - March 2008 period. With a 10-15 per cent increase in pricing, the industry is likely to increase its profit margin realisation by 5-10 per cent. However, the poor condition of Kerala roads and other infrastructure create a negative impression with the foreign tourists. Also, the availability of skilled manpower is becoming a major concern to the industry. The industry feels that the government should take up development of more hotels with 400-500 rooms. The promotion strategies also have to be redesigned to attract upmarket tourists.

Improved performance

Kerala’s coir industry, the leading producer of coir in India, has experienced improved performance during the current half-year. The coir industry production has increased by 5-10 per cent and consequently, sales and export have also grown by 5-10 per cent and 15-20 per cent respectively during the same period. As a spill-over effect, the capacity utilisation level has gone up by 15 per cent. The value of production and inventory levels has increased slightly by 5-10 per cent. The coir industry is expecting an improvement in the performance parameters during October- March.

The industry expects 5-10per cent increase in production, 15-20 per cent increase in both sales as well as exports during the same period. The availability of raw material to the industry is one of major constraints of the industry. The industry seeks development of infrastructure, and feels road and railway linkages need to be improved. The chemical and fertilizers industry in Kerala witnessed good performance during April-September 2007. The production and sales of the industry has gone up by 10-15 per cent; the result of increased production could be inferred from the increased capacity utilisation levels of up to 7.5 per cent during the same period.

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