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In chapter four we evaluated the entrepreneurial role of government and followed it up
with the role of government in provision of public goods in the fifth chapter. In this
chapter we explore the legislative and regulation; stimulation; and planning role of
government; and also evaluate the tourism policy-2001. The role of government as
interest protector is an overarching aim of government reflected in the tourism policy and
in its regulatory role, and is entrenched in India’s Directive Principles of State Policy.
The social tourism role is out of the realm of this study, but again, social tourism has
been part of every government’s policy. Both central and regional government
employees in India get earned leave as well as leave travel allowance as a means to
encourage tourism for all. Private employers also have to give earned leave as per labor
laws in India, and many also offer leave travel concessions to their employees, expenses
towards which are allowed as legitimate business expenditure. Student concession for
travel is also available in India. Our objective in this chapter is to examine the role
played by government in regulating the economy; and in incentivizing the private sector,
and to see whether this role has been proactive, and has shown a progressive
increase/enhancement. This will later help us to make our case that once the tourism
policy is announced all these measures should become part of that policy, in that the
existing regulation should also be attuned towards achieving the policy goals laid out.
Further, we examine the planning initiatives undertaken by Goa government, especially
master plans formulated for tourism and how it is viewed by stakeholders. Later, we
examine the tourism policy formulation and implementation role of government, and
undertake a comprehensive evaluation from the points of view of tourists, business
stakeholders and residents using a perception study conducted for that purpose.

The Constitution of India makes allocation of powers between the central and state
governments and has a concurrent list, which mentions the subject matters on which both

the center and the state can legislate, however it has not mentioned tourism in any of the
three lists under the Constitution, allowing space for the center and state governments to
work in co-ordination with each other on different tourism related activities.
Tourism-related activities in India are governed by different laws, provisions and rules of
the central, state Governments and local bodies. Regulatory measures are generally
aimed at the smooth functioning of the tourism sector and encouraging or prohibiting
certain behaviors. In the earlier stages of tourism development in Goa, the state more or
less followed a laissez faire approach allowing tourism to grow in a haphazard manner
mostly in the unorganized sector in the coastal villages and in towns like Panaji with
mainly families running accommodation facilities like ‘mom and pop’ establishments
mostly from their own living spaces. As tourism began to grow some private players
from outside Goa and local ‘big families’, ones that had grown economically through
mining and trading endeavors, began to enter this sector (as they did in other industries).
Growth in tourism numbers made the Goa government to not only increase its presence
in the sector through direct provision, but also increase its footprint through sector
specific regulation. We take a brief look at these efforts.

6.2.1 Tourism Regulation in Goa

The tourism and hospitality industry in India is governed by a number of laws, rules and
regulations such as; Environment Protection Act and CRZ rules (prohibiting construction
or development within the 200 meter high tide line; and other compliances/rules) and
other sustainable tourism regulations; and heritage conservation laws; Foreign Exchange
Management Act, Foreign contribution (Regulation) Act, and other laws related to
foreign exchange;    they also are covered by; The Customs Act,      The Customs Traffic
Act; several industrial laws like the Indian Contract Act; Partnership Act, Labour, Health
And Safety Laws including           pension, gratuity and provident fund, and other
employment laws as well as fire safety and hygiene regulations; similarly, the Industrial
Policy, the Transfer of Property Act, land acquisition regulations, and other
developmental/environmental control orders of the central/state/local governments also
apply; again there are Insurance Laws; Shops and Establishment Act; and Food and Drug
Administration Act; plus the industry has to contend with other laws applicable to other
businesses and some specific ones like; laws related to income tax, service tax,
expenditure tax, excise duty, luxury tax, entertainment /amusement tax, etc. Again,

Hospitality establishments have to further obtain licenses, such as a liquor license, dance
license, lodging house license, eating house license, police permissions and gaming
licence, licenses for holding events, etc. In addition to these, in Goa the government has
introduced sector specific regulations, rules and policies which are reviewed below.

6.2.1.i The Goa, Daman and Diu Registration of Tourist Trade Act, 1982 and Rules,

A legislation to regulate the tourism-related activities was enacted in 1982 namely the
Goa Registration of Tourist Trade Act and The Goa Registration of Tourist Trade Rules
were formulated in 1985. It has been amended in 1988, 2001 and 2011.The Act requires
hotels, tour operators, travel agents, tourist guides, tourist taxi operators, adventure
sports operators, water sports operators, spice plantations, providers of temporary huts,
beach shacks, deck beds, dealers of notified articles, and other persons engaged in tourist
activities to mandatorily register themselves under the Act. Registration has to be
annually renewed. The Act also authorizes the prescribed authority to classify the hotels
and award a grade to each hotel and also fix the reasonable maximum rate and the
service charges, except those classified or graded by the Government of India or by a
recognised board or authority. The Act also prescribes penalty/punishment in specified
cases; the rules for notification of changes in business; issue of duplicate certificate;
power to inspect; fixation of rates for other services; powers of Government to apply Act
to other persons; and powers and duties of police in respect of offences under the act etc.
The Director of Tourism is the prescribed authority under the Act. (Please see DOT
website for full policy)

6.2.1.ii The Goa Tourist Places (Protection and Maintenance) Act, 2001

The Goa Tourist Places (Protection and Maintenance) Act 2001 extends to the whole of
the State of Goa, and aims to protect and maintain the tourist places from deterioration
and erosion and preserve their tourism potential. Under the Act, the Government may, by
notification in the Official Gazette, declare any place, monument, site, location to be a
tourist place for the purposes of this Act, including any river, riverbed, beach, water
spring, lake, water course or land, etc. At present all major monuments, churches,
temples, lakes, waterfalls, parks and gardens, lakes, springs, museums and art galleries,
and seminaries; all wild life sanctuaries; all forts; all beaches; and the cities of Panaji,
Margao, Mapusa, Vasco and Ponda are notified under the Act. The Act prohibits any

nuisance being caused or prevents any such activity, process, operation, if it has
damaged or deteriorated or is likely to damage or deteriorate the tourism potentiality of
any tourist place. The property, thing, material or object, which is a nuisance may be
disposed off or dealt with by the Government, in the manner it deems fit. The Act also
prescribes punishment and penalties under specified circumstances. The Government has
the power to make rules for carrying out the purposes of this Act and the power to
remove any difficulty in any provisions. The Director of Tourism is the competent
authority for the purpose of the Act. (Please see DOT website for full policy).

6.2.1.iii Tourism Policy for Erection of Temporary Seasonal Structures, Beach
          Shacks, Huts and Others, 2013-16.
Before the policy came into existence the registration of shacks etc. came under theGoa,
Daman and Diu Registration of Tourist Trade Act, 1982 and Rules. In 2012, it was felt
that there was need for change in the policy and accordingly some amendments (XXVIII
Cabinet meeting dated 25/01/2012) to the beach shack policy in accordance with section
13 B of the above mentioned act were made for the ensuing season and later a
full-fledged policy was put in place. The above policy provides the Policy/Guidelines for
erection of temporary beach Shacks/ Deck Beds/Umbrellas/Huts and other temporary
seasonal structures for tourism purpose over the period 2013 -2016. The temporary
structures are allowed to be erected for specified periods and necessary fees and security
deposit needs to be tendered. The Act prescribes various rules and eligibility criteria
regarding selection. For the first time the Act also prescribes benchmarking standards for
the shacks. It also lays down penalties and punishments for non-compliance with
provisions. (Please see DOT website for full policy).

6.2.1.iv Policy for Regulation of Watersports in Goa

As the number of operators and the types of water sports activities began to grow in Goa,
itincreased competition among the water sports operators, and led to illegal and unfair
means being used in the trade thereby causing nuisance to the water sports loving tourists
among other issues. In order to curb this nuisance, The Government of Goa in the year
2005 approved “The Goa Tourist Places (Protection and Maintenance) (Boat
rides/Parasailing and Watersports Activities) Rules 2005”. Even after coming into force
in 2005, there were reports of many water sports operators illegally functioning in the
State, and illegal measures and unfair trade practices taking place such as; overcharging
the tourists; engaging of touts; and endangering of the safety of the tourists/ general

public. The Goa Registration of Tourist Trades Act, 1982 was therefore amended in the
year 2011, and Water sports and Adventure Sports operators were registered under
Section 19A to 19D of The Goa Registration of Tourist Trades (Amendment) Act, 2011.
However, issues still remained more or less as before and the matter went before the
Courts which issued guidelines to the state to enact proper legislation/ rules. The new
Policy for Regulation of Water sports therefore aims to comply with the directions of the
Honourable High Court in order to regulate and monitor the entire Water sports Activity
in the State of Goa. The Policy lists about 25 activities as Watersports activities like
waterskiing, boating, canoeing, kayaking, jet skiing etc. The Government of Goa has
designated the Department of Tourism to function as the Nodal Department for the safe
and smooth operations and regulation of the water sports in the entire state, and all the
other related Departments like Captain of Ports, Department of Fisheries, etc.
Department of River and Navigation, Department of Water Resources, Police
Department etc are to coordinate and assist the Department of Tourism in smooth
discharge of its functions in regulating of water sports activities in the state. By
formulating this policy the Government of Goa through its various Departments has
taken upon itself the absolute right and control over water sports activities and the right
to fix eligibility criteria, rules, regulations, standards etc for water sports activities in Goa.
(Please see DOT website for full policy).

Towards water sports some other policy measures worth mentioning are; the setting up
of a National Institute of Water Sports by the national government in 1990 which since
2004operates as a centre under the IITTM. It has been functioning as a nodal agency in
water sports training, consultancy, regulation, benchmarking and standardisation
especially regarding safety, as well as in awareness, promotion and development of water

6.2.1.v Other Regulatory/Policy Measures Impacting Tourism

In 2003, a scheme for conservation of Heritage Houses, Goa Heritage House Tourism
Scheme, 2003, to promote cultural and heritage tourism was introduced with a Heritage
Tourism Committee to administer the scheme. The state government pursued a policy to
make Goa the permanent venue for the International Film Festival of India (IFFI) and
making the IFFI an important festival tourism source. Goa has now been designated as
the permanent venue. Another policy step was to legalise Casinos with an aim to

diversify the tourism product and attract affluent tourists. Accordingly, Casinos have
been accorded legal status in 5-star hotels and ships anchored offshore since 2008. In
2011, the Goa government's proposed Forest Policy aims to boost eco-tourism initiatives
through a community based approach involving locals by imparting suitable training in
hospitality, bird watching, botany resource and nature guiding etc to encourage them to
take up such initiatives in their own land holdings. The state government has also lobbied
for Visa on Arrival facility at Dabolim Airport which facility has now been extended to
Goa. A Single Window Clearance System for giving permissions for major and minor
events in Goa has been set up in 2014. Also, a policy to provide refund of VAT paid on
goods purchased by tourists and taken along with them while leaving Goa is on the anvil.

The above discussion indicates that Goa government has been active in the tourism
economy with an ear to the ground and has increased its footprint through timely
legislations and policy steps to benefit the sector and to mitigate negative fallouts.

6.2.2 Stimulation Efforts of Government/ Incentives for Tourism Industry

(Timothy, 1998) asserts that the public sector is dependent on private investors to provide
services and to finance, at least in part, the construction of tourism facilities. For a private
sector driven by the profit motive, stimulation efforts by government in the form of
incentives and other benefits plays an important role in encouraging them to undertake
much needed investments. Stimulation efforts in India to promote private participation in
the tourism economy have been carried out both at the central and state government levels.
We examine these below, first examining the incentives by the national government,
followed by stimulation initiatives by the Goa government:

6.2.2.i Incentives/Stimulation Initiatives for Tourism Industry by Indian

The central budgets have been announcing special schemes for hotels and tourism
industry in India for specified periods to achieve policy targets from time to time, which
has seen a marked increase after the new economic policy of 1991 and especially after the
formulation of the tourism policy of 2002. The major stimulation efforts are given below:

    1. Tourism has been accorded Industry status enabling it to receive various

2. Tourism units have received export house status enabling hotels, travel agents, tour
   operators, tours and transport operators, etc. to avail benefits against Export
   House/ International Service Export House / Star and Super Star Service Export
   House status. Such status enables them to get several benefits, like for example,
   exemption from compulsory negotiation of documents through banks, 100%
   retention of foreign exchange in EEFC account, enhancement in normal
   repatriation period from 180 days to 360 days etc. Further, hotels of one star and
   above including heritage hotels and restaurants get duty credit benefit as per

3. Under the Export Promotion Capital Goods (EPCG) scheme, Hotels can avail a
   concessional rate on customs duty of 3 percent for capital goods, subject to an
   export obligation equivalent to 8 times of the duty saved in a period of 8 years.
   Hotels, travel agents, tour operators and transport operators and companies
   owning/operating Golf resorts can also import motor cars and SUV’s at 3%
   customs duty subject to conditions.

4. 100% Foreign Direct Investment (FDI) is allowed in Hotels and tourist related
   industry through automatic route, that is, there is no requirement of any prior
   regulatory approval, only post facto filing / intimation with the RBI.

5. Under ‘Served from India Scheme’, Hotels, Restaurants, Tourism and Transport
   related Services are entitled for ‘Duty Credit Scrip’, enabling the import of capital
   goods by them in the line of business. Hotels and stand-alone restaurants can also
   use the scheme for the import of food items and alcoholic beverages.

6. The government with a view to encourage technology transfer from abroad,
   accords automatic approvals subject to certain conditions for technology
   agreements where companies are running or managing hotels with at least 500
   rooms, and where the IT systems are provided by foreign suppliers.

7. Expenditure tax has been waived in respect of hotels located in hilly areas, rural
   areas, and places of pilgrimage or specified places of tourist importance.

8. An interest subsidy scheme is available for budget hotel projects, and for one to
   three star category hotels (3% for hotel projects located outside metropolitan cities;
   5 % for hotel projects located within travel circuits; and 5% for heritage hotels).

To promote heritage tourism, incentives are also available if any heritage building
       (palace, bungalow, etc.) is converted into a heritage hotel.

   9. The Government of India has designated eco-tourism as a ‘thrust industry’ in
       some states like Jammu and Kashmir, Sikkim, Himachal Pradesh and
       Uttaranchal. A range of incentives are available for eco-tourism projects such as
       hotels, resorts, spas, entertainment/amusement parks and ropeways.

   10. Income tax exemption is available for hotels, travel agents and tour operators to
       the tune of 50 per cent of the foreign exchange profits. The balance foreign
       exchange is also exempt if reinvested in tourism projects. Again, hotels located
       outside of metropolitan areas and specifically in rural areas, hilly areas and
       pilgrimage centers are allowed income tax exemption of 50 per cent on their
       profits, while for other areas it is 30 per cent.

   11. The Reserve Bank has de-linked the credit extended for hotel projects from
       commercial real estate sector credit thus enabling credit at relaxed norms, and
       reduced interest rates for hotel projects. New hotels of 2 star categories and
       above, set up anywhere in India are allowed 100 per cent deduction in income
       tax, in respect of the whole or any expenditure of a capital nature excluding land,
       goodwill and financial instruments, incurred during the year.

   12. The Tourism Finance Corporation of India has been set up which extends finance
       to the private sector to build hotels and other tourism facilities.

6.2.2.ii Concessions to Tourism businesses in Goa

In addition to the above incentives which are also available to businesses in Goa (except
afew enacted for specific areas), the state Government in Goa has given the tourism sector
"industry" status in 2001, tourism is thus treated as an industry under the Industrial policy
2003, enabling tourism projects to get preference or overriding priority in matters of
clearances/ registration/ allotment of plots etc. In addition, the tourism sector also gets
concessions on water and power tariffs and tax concessions on VAT and luxury tax. A loan
scheme with attractive interest and repayment period including grant in aid, was
introduced in 2003-04 for heritage houses used for the purpose of tourism. The
government has also been promoting various infrastructural projects under public-private-

partnership system. It has also been following a policy of leasing out government tourism
properties to private sector for upgrading and professional operations.

Governments’ stimulatory efforts both at the central and state levels has been towards
drawing finance to the sector; upgrading facilities and encouraging expansion;
encouraging setting up tourism facilities in targeted areas and diversifying the tourism
product; and increasing price competitiveness of tourism service providers. The
underlying aim is to achieve the tourism number targets and related economic objectives.

6.2.3 Tourism Planning in Goa

Before the process of a separate tourism policy began in Goa, tourism formed part of the
annual budgetary plans of the government. In addition, the five year plans also had a
state focus and efforts in a planned manner were initiated to achieve policy objectives
laid out for the sector. However, Goa also prepared separate Master Plans for the tourism

6.2.3.i Master Plan for Tourism Development in Goa- 1987

The first sector specific effort towards planning was the Master Plan for Tourism
Development in Goa, 1987. In December 1986, the Central Government decided to
exploit Goa and its beaches in the interests of the destination for charter tourism. The
Goa Government asked the Town and Country Planning Department to prepare a Master
Plan which was completed in May 1987. The Plan was based on a physical and
socio-economic survey of two villages, Calangute and Candolim which brought out
many socio-economic impacts of tourism, including garbage problem, congestion,
inflation, power and water shortage, pollution and environment damage, crime, vice etc.
It thus proposed to expand tourism in way as to avoid adverse effects and sought to
disperse tourism development across Goa by demarcating areas into three categories:
Tourism Development Areas (TDA): where hotels with up to 100 rooms would be
allowed. 13 areas for TDA were identified; firstly, Tourism Resort Areas (TRA): these
would involve medium or large-scale beach resorts with over 100 rooms. These were
restricted to five sites, two in the north and three in the south; and secondly, Village
Tourism Areas (VTA): where, the maximum number of rooms allowed would be 10. It
also introduced the concept of a holding capacity, which in ecological terms is called the
carrying capacity of an area. It also set out a setback line for different areas of Goa and
designated no-development zones from the high tide line. The Master Plan also provided

detailed statistics about the state of tourism in Goa. It went into considerable detail on
how important residential buildings of great aesthetic value could be exploited for
lodging guests. It provided various projections, extrapolations and recommendations on
tourism-related parameters like the number of tourists likely to come in a particular year,
the requirements of electricity and water, the demand for food and transportation, the
need for accommodation and entertainment, the plans for beautification and for the
preservation of the environment. It projected tourist arrivals to reach 11, 20, 000 by the
year 2001. A great deal of publicity was given to the Plan and it was kept for viewing in
a few public places. However the move to convert Goa into a tourism economy gave rise
to spontaneous protests from people and activist groups. The result was that the Master
Plan was quickly shelved and very little was heard or seen about it in terms of actual
implementation on the ground (Alvares, 1993; 212).

6.2.3.ii Tourism Master Plan- Goa, 2011

In 2001, the Tourism Master Plan- Goa, 2011, a comprehensive tourism master plan was
formulated. The Tourism Master Plan for Goa has been prepared keeping in view a
perspective of the next 25 years, and forms an integral part of the revised Regional Plan
of Goa – 2011 AD. It indicates the stages in which various development works are to be
carried out and provides project cost, investment plans, funding mechanism, financial
analysis, public and private sector participation and undertakes a SWOT analysis of the
tourism economy of the state. The objective of the plan is sustainable development of
tourism with several sub-objectives namely; dispersing tourism to the hinterland;
attracting tourists in the monsoon/ lean season; introducing and enhancing both new
tourism and existing activities, like adventure tourism, cultural- heritage tourism, pilgrim
tourism, business tourism, sports tourism, education tourism; and identifying
infrastructure and other developmental needs for tourism. The plan estimated that in
2021 domestic tourist will grow to about 2 times the present level and foreign tourists to
about 4 times the present level and overall tourism numbers to about 2.5 times. A
Compound Annual Growth Rate (CAGR) of 6.53 percent for foreign tourists, 2.63
percent for domestic tourists and 3.67 percent for the total tourists was taken. These
projections were adopted for working out infrastructure needs, employment generation
and required accommodation capacity. The Plan proposes to develop new tourist centers
distributed all over Goa with areas varying from 500 ha to 1000 ha. These centers, set up
at appropriate locations would accommodate tourist activities as well as facilities for

socio- cultural activities for local population and would give a boost to tourist activity
and local economy. These included; business tourism –cum- recreational centre; water
sports centre /water park and educational centre; educational / business centre;
techno-recreational centre; leisure city; health tourism centre; potential heritage and
village tourism centres; discovery & adventure tourism activities; enhancing late evening
recreational activities for tourists; developing man made attractions and augmenting the
potential of other natural attractions; and developing handicrafts industry in Goa for
tourists to leverage more spending by tourists. The Plan makes taluka wise projections
for tourist arrivals with the belief that low destination Talukas will pick up tourist flow
after implementation of the Plan. The plan has also projected the setting up of; help line
centres /information centres equipped with telecommunication equipments, internet etc,
having latest information, and equipped with emergency health services information;
emergency lifeline, a 24 hrs tourist line with manned phones to assist tourists to contact
in case of an emergency and also to act as a complaint and follow-up mechanism against
erring establishments. The plan also provides for; measures to control beach and
estuarine pollution; recommendations for development of transport and physical
infrastructure, including transport, power, water, sewage etc.; heritage conservation
(archaeological, historical, architectural and cultural); and recommends a marketing
strategy to ensure implementation of the development plan. It has also projected tourism
income and employment generation, after implementation of the plan including, the
value-added benefits generated from tourism. Further, it has also projected cost of the
planned steps; given an investment plan; and suggested a proposed tourism policy for the
state. It has also suggested an institutional mechanism for implementation of the plan,
namely a Goa Tourism Development Commission/ Board,similar to the California
Tourism Development Commission. (Pl. See Tourism Master Plan Goa- 2011 Document
for full details)


Before going into the Tourism Policy of Goa, 2001, we examine the National Tourism
Policy 2002 which was based on the 1997 Draft National Tourism Policy and which
influenced Goa’s tourism policy. We have already discussed in chapter three that the first
significant policy step in India was taken in 1982, which aimed at the development of
tourism circuits.

6.3.i The New Tourism Policy (2002)- National Level

In 1997 a Draft National Tourism Policy was published and kept for public debate. It
aimed at promoting sustainable tourism as a means of economic growth with a plan to use
tourism for employment growth, social integration and promoting India’s rich culture and
diversity. The policies to achieve these objectives would evolve around six broad thrust
areas, namely, Welcome (Swagat), Information (Suchana), Facilitation (Suvidha), Safety
(Suraksha), Cooperation (Sahyog) and Infrastructure Development (Samrachana). While
conservation of heritage, natural environment; and development and promotion of tourist
products; would also be given importance. It laid a set of Action Plans to achieve each of
these thrust areas. In the year 2002, The New Tourism Policy (2002) was formulated
which finally translated the action plans into a tourism policy, and tourism officially
became a joint central-state government concern. The policy document attempted to
establish tourism’s great contribution in national development and its role as an engine of
growth. The policy document put forward seven key areas that will provide the thrust to
tourism development. These are Swagat (Welcome), Soochna (Information), Suvidha
(Facilitation), Suraksha (safety), Sahyog (Cooperation), Samrachana (Infrastructure
Development), Safai (Cleanliness), the last being an addition to the 1997 draft policy.
The new tourism policy aims to increase the number of domestic and international
tourists. In order to do this, the government proposes to diversify the tourism products
and substantially improve the quality of tourism infrastructure, marketing, visa
arrangements and air travel. It aims at building an institutional framework which is
Government-led, private-sector driven and community-welfare oriented, with identified
roles for government and private sector. It seeks to build linkages with related
departments like Railways, Civil Aviation etc. to leverage coordinated efforts.
Sustainability is to serve as a guiding star for the new Policy with effective steps at
conservation and environment protection. Eco- tourism and yoga would have a major
thrust along with domestic tourism. The policy expects industry and travel agents to take
steps to evolve and adopt a voluntarily Code of Ethics, and any infringement has to be
resolved by industry associations. A section of police force of the state is to be
earmarked as tourist police. Further, the policy requires India to actively take part in

world tourism forums and project India’s unique culture and religious heritage. Civil
administration and governance systems also need to be overhauled. The policy is a major
step in making tourism a growth centre for the economy. (Singh, 2001) however,
believes that the ideology behind the 1997 draft national policy and the new tourism
policy of 2002 was still very much rooted in government intervention as a means to
develop the tourism economy. The policy document itself makes this clear asserting that
allowing uncontrolled tourism can mean that the tourism sector may not work in
achieving national developmental goals, and it could also lead to negative socio-cultural

6.3.ii Goa Tourism Policy- 2001

Before going into the policy details, as noted in chapter three, in Goa, tourism was part
of the five year plans from even before statehood. The Tourism Policy was a first sector
specific, separate and comprehensive road map. The policy recognizes that tourism
contributes positively to reconciling environment protection, economic development and
the fight against poverty by creating wealth through economic movement and foreign
exchange earnings, contribution to government revenues, spread of economic and social
benefits to under developed areas, income and job creation, raising living standards and
preservation and conservation of natural and cultural environment. It further exhorts that
the human, social, economic and cultural values of tourism needs more focused attention.
Further it is aware of the role of tourism as a major economic activity in Goa having
direct and indirect correlation with all other sectors and the unique cultural mosaic and
diversity of tourism resources that Goa possesses.

Approach and Strategy

While retaining the traditional image of Goa as a prime beach destination, diversification
and value addition of the tourism product would be speeded up. New areas such as
eco-tourism, hinterland development (villages), cultural heritage tourism, business
tourism, adventure tourism and Indigenous Health Care System would be encouraged.
The private sector would be encouraged to play a leading role in tourism development.

Policy Proposals

The basic Government policy aims to raise the quality of the infrastructure, which is
considered the foundation for the sustainable growth of tourism and crucial for

accelerated benefits to the people of the state. Accordingly, Government according to the
policy would endeavor to provide:

      Encouragement to existing private initiatives through an appropriate package of
       fiscal and friendly taxation measures.
      Investor friendly environment for new private initiatives through a combination
       of prompt processes and progressive fiscal and taxation policies.
      Develop tourism as a non-invasive instrument of revitalization, conservation and
      A balanced tourism development as a part of the overall Area Development
      Public Infrastructural facilities including local planning and zoning arrangements.
      Devise regulatory measures to ensure social, cultural and environmental
      Ensure that the type and scale of tourism development is compatible with the
       environment and social cultural milieu of the area.
      Ensure that the local community is involved and the benefits of tourism accrue to
      Ensure availability of trained man-power primarily from amongst the local
      Undertake research, prepare Master Plans, formulate marketing strategies and
       organize domestic and overseas promotion and marketing jointly with the
      Ensure Regulation of Indigenous Tourism related Health Care System.
      Undertake measures to ensure promotion, facilitation and regulation of Tourist

Role of Private Sector (Sambandh)

The policy states that in the initial stages Government had to build basic infrastructure,
as at the time, the private sector was reluctant to come forward, on account of low returns.
Now the situation has changed and therefore the Government will concentrate on only
upgrading infrastructure. Infrastructure like roads, power, water, are mentioned as
infrastructure areas for government. The policy states that the Government would extend
all necessary assistance and facilities required by the private sector for development of
tourism in the State. Areas like accommodation facilities, restaurants, entertainment
facilities, shopping complexes, have been identified for private sector participation.

Adoption of New Technology (Suvidha)

In improving facilitation to tourists, some of the important areas which would receive
special attention are: computerization of offices with up-to-date information; provision
of internet and e-mails; development of CD –ROMS; installation of touch screen of
international standards and IVRS at important centers; installation of handy audio reach
kit (HARK); remote presence system at important monuments (like the one recently
installed at Qutab Minar at Delhi). An ambitious programme would also be launched to
connect the central and state Agencies, members of travel trade and airlines for
dissemination of information and exchange of knowledge. Major thrust of the
Government would be on fast and modern methods of publicity and promotion.
Roadshows undertaken abroad would use sophisticated technological marketing tools.

Fall Outs/Negative Effects

The policy affirms that the Government would actively contain negative fallouts arising
out of negative publicity through proactive publicity with the cooperation and assistance
of the media, general public, travel trade and Indian missions abroad.


The policy further asserts that it would be the responsibility of the state government to
provide adequate finance for the development of tourism, while the Government of India
would provide funds for the Centrally Sponsored Schemes. State contribution would be
generated through friendly taxation and fiscal policies and funds would not be a
constraint for up-gradation of infrastructure and for tourism promotion.

Action Plan (Swagat, Sanrachna)

The policy states that in order to achieve the desired objectives, the structural
organization of the tourism set-up would be further strengthened and toned up. Processes
and procedures would be simplified. Co-operation and assistance of Central Government
and other agencies would be taken. The hospitality industry, the people of the state and
other like-minded organizations would be actively involved in the developmental process.
In addition, the following measures would be taken within a definitive time frame to
achieve the objectives set out in this policy.

   Strengthening statistical machinery, reporting systems and developing a
    comprehensive data base to quantify and evaluate socio-economic benefits of
   Identification of potential tourist destinations for integrated development,
    formulation of appropriate marketing strategies and monitoring of progress and
    impact of programmes through development of a Management Information
    System (MIS)
   Organisation of Workshop and Seminars on tourism to educate and imbibe a
    positive tourism culture among staff, planners and the general public.
   Focusing special attention on the development of Eco-tourism, cultural heritage
    tourism and adventure tourism.
   Launching entrepreneurship development and self-employment schemes to
    involve the educated un-employed youth in providing various tourist facilities
    and services, thereby creating employment opportunities.
   Identifying potential markets and adopting focused marketing strategies based on
    research to make promotional and marketing efforts cost effective and well-
   Strengthening of human resource development institutions and improving the
    standards of training in private institutes through accreditation.
   Creating awareness about Goan traditions and hospitality through local bodies,
    N.G.O’s and Youth organizations.
   Improving the efficacy of tourist facilitation services by coordinating with all
    concerned, adopting information technology and imparting training to customs
    and immigration officials, taxi drivers, porters, tourist guides, etc.
   Encouraging the private sector to create infrastructural facilities by providing
    suitable fiscal and other incentives specially for paying guest accommodation,
    Heritage hotels leisure and marine tourism
   Encouraging N.G.O’s like INTACH and Heritage societies, by providing them
    support, assistance and making use of their expertise for development of tourism.
   Providing assistance and facilitation to Indian as well as foreign investors for
    setting up special tourism projects by streamlining the Project clearance
    mechanism and placing it on the fast track.
   Imposing regulatory measures on developers, operators, tourists and local
    communities under the existing laws and rules to ensure social, cultural and
    environmental sustainability of tourism projects.
   Setting up of a Tourism Promotion Board to review the policy from time to time
    and supervise the overall operations of the tourism sector in the state.

The tourism policy of Goa is thus a comprehensive exercise that has drawn extensively
from the draft national policy, while also addressing various local issues facing the sector,
and offers a road map for tourism development in Goa in a sustainable manner.

    POLICY OF GOA, 2001

Literature supports the argument that public policy is a major function of government
driven by objectives, value choices including the political will to develop tourism,
ideology, and indeed, the needs and circumstances of the times, which may actually
influence all the other factors listed. Again, and more importantly it is necessary to
realize as Hall, Jenkins, Pearce and others have pointed out from time to time, that public
policy making is not an exact science, not just because of the factors listed above, but
more so because it involves the human element. Thus, while evaluating public policy
from an audit point of view, in hindsight, many things may seem to be sub-optimal and
falling short on goal achievement for some; while for others it may seem in line with the
laid out objectives; the evaluation depending on the eye glasses one chooses to wear.
Thus a garbage disposal plant planned but not commissioned may be viewed as a failure
of public policy, or as government being sympathetic to stakeholder concerns on the
possible fallout of such a facility on the local community. The study thus prejudges that
the best way to evaluate policy performance would be though a perception study of those
who are in a way (following the idea of Mathieson and Wall, 1982) that tourism is a
consumer good) consumers of tourism public policy initiatives, having to face the
positive and negative impact of such initiatives. That is, to examine the perceptions of
tourists, stakeholders and residents. Perceptions here refer to the opinions/ beliefs that
respondents have about the performance of various parameters of tourism policy.

The new tourist (Poon, 1993), is older, well travelled, more educated and knowledgeable,
more demanding, and quality & environmentally conscious. Perceptions of such tourists
offer valuable information for policy makers. (Ahmed, 1991) believes that perceptions of
most tourists about a destination are driven by experiences with other destinations, and
involve comparisons among facilities, attractions, and service standards. Even first
timers who have never visited the destination have an image (organic image) of a
destination formed from books and media reports, to which they add after the visit, and

on which marketers do not have control (Gunn, 1985), perceptions of such visitors would
offer rich information. Further, tourists holiday experience at a destination is made up of
several tangible and intangible components and positive and negative experiences
(Pizam et al, 1988); formed by a combination of the image they have about a place, and
the actual experience and is the result of their total experience involving satisfaction with
tourist attractions ((Gunn, 1985;Weber, 1997), perception of airport services and service
quality at airports, accommodation facilities, (Loudsbury and Hoopes,1985), the
perception of quality of service delivery by accommodation and other service providers
(Tribe and Snaith,1998), and the feeling of welcome in a place which also comprises the
perception of psychological comfort (Resinger and Turner,1997) that tourists feel or
don’t feel after interactions with hosts and service providers in a destination. The study
has investigated all these areas of the tourist’s experience.

(Elliot, 1997) states that tourism is a diversified industry which requires cooperation, and
close, incessant and well balanced relations between the public and private sector which
is dynamic and based on partnership and exchange. For this a tourism policy which is
responsive to the market and industry, and which identifies roles for the private sector
with appropriate stimulatory support and regulatory framework, is important. Thus,
perceptions of industry stakeholders of tourism policy as done in this study, will offer an
insight into whether industry stakeholders view governments’ role in the tourism as
apositive influence or a hindrance, as having benefited the sector or harmed it.

Residents of a destination form their attitudes based on positive and negative perceptions
of the economic, social, and environmental implications of tourism development thus
perceptions of residents are useful indicators of actual impact of tourism development in
a destination. In this study we make a case study of the main ‘tourist belt’ in North Goa
to understand the impact of a tourism promoting development agenda followed by the
Goa government as perceived by residents.

Again, (Weiremair, 2000) asserts that all services that contribute to a holiday experience
are provided at the tourist destination hence, researchers accept the destination as a
relevant unit for comparison and analysis. Thus, in our study the ‘tourist destination of
Goa’ forms the unit of study. Further, this perception study is consistent with the
description offered by (Mathieson and Wall, 1982) that the study of tourism is a study of;
people away from their usual habitat; of establishments that meet the requirements of

travelers; of the impacts that tourists have on the economic, physical and social
well-being of their hosts, and the adjustments residents have to make; the motivations,
experience and expectations of tourists; and the roles played by various agencies and
institutions which intercede between them.

6.4.1 Perception of Tourists:
Tourist satisfaction is an emotional expression of the tourist after exposure to an
experience (Baker and Crompton, 2000) at a destination. It may thus be expressed in
degrees depending on the tourists own evaluation of an attribute against a predetermined
set of expectations about that attribute. Some attributes may exceed expectations and
others may not, thus a positive response conveys satisfaction and a negative one,
dissatisfaction with that attribute. Satisfaction and dissatisfaction are then two post
consumption outcomes of an experience that have a bearing on the tourists decision to
visit again and influence a positive or negative word of mouth for a destination. This idea
conforms to the expectation disconfirmation model (Oliver, 1980) that postulates that
consumers have a prior disposition or expectation about the product or service before
actual purchase or consumption. If the actual performance is better that expected a
positive disconfirmation ensues and vice versa. However a destination also has first
timers or even ‘first time holidayers,’ ones taking a holiday for the first time. Here the
norm theory (Latour and Peat, 1979), applies which posits that norms serve as reference
points for evaluation of the destination, in that, tourists compare the mental image (norm)
they have about the destination, with the actual experience in the destination, such that, a
confirmation of the norm leads to a positive response or a feeling of satisfaction and vice
versa. The cognitive- affective model of tourist satisfaction also confirms the importance
of image as a determinant of satisfaction.

Since level of satisfaction is a state of mind, there is no universally accepted and absolute
tool to measure it, the researcher has to choose an appropriate tool (Rajendran, 2012). In
our study the construct comprises statements that takes a neutral stance on attributes
(forming the tourism policy framework) thus enabling respondents to more correctly
choose (without any leading from the researcher) an alternative that expresses their
perception of satisfaction or dissatisfaction for that attribute. (Tribe and Snaith, 1998), in
their HOLSAT model propose the inclusion of negative attributes along with positive
attributes arguing that this helps in soliciting more complete information from tourists as

the negative attributes are negative features tourists are likely to face in the destination.
In the present study attributes with an intrinsic negative composition like safety and
security, garbage and cleanliness, landscape and environment protection, upkeep of
tourist places, prices in the destination etc were included but not coloured negatively in
the construct in order to avoid leading the respondent in one direction. A neutral stance
was considered appropriate to avoid an extra negative focus. Similarly, respondents were
not told that the study was particularly investigating attributes in order to evaluate
tourism policy (government) performance. Questions were simply framed in terms of
destination satisfaction deliverables. The idea was again to avoid respondent bias that
invariably creeps in when evaluating government which takes a positive or negative bent
depending on the individuals’ ideology, experience with government and other factors,
and may completely colour the response in either direction.

(Yu, and Goulden, 2006), contend that tourist’ satisfaction comprises all aspects of the
tourists’ experience derived from their participation in various activities during their stay
in a destination and includes their perception of the service quality and price
competitiveness of the destination. While many studies have been done on customer
satisfaction, not many have undertaken tourist satisfaction studies. Some prominent
studies in this area are by, (Reisinger and Waryszak, 1994; Tribe and Snaith, 1998;
Baker and Crompton, 2000; Gathade, 2012; Chavan and Sarang, 2014), however none of
the studies have evaluated satisfaction with tourism policy. Measuring tourist satisfaction
with tourism policy parameters is useful as tourism policy contains the ‘thrust areas’ of
government’s policy towards tourism development, aimed at ensuring that a tourist’s
holiday experience is as close to optimum/expectation levels as possible. An optimum
delivery of tourism policy deliverables will ensure higher satisfaction with the
destination and as (Tribe and Snaith, 1998; Kozak, 2001; Aksu, et al, 2010; Li, et al,
2012) contend give a good word of mouth for the destination, and higher repeat visits
and thus help in meeting arrival targets, and the economic targets for the region. Further,
such a study is particularly called for in the light of growing public expenditure on
tourism development, and promotion in Goa, and can act as a ‘barometer’ to show
whether the action plans executed by government of Goa thus far have been making a
difference to those who really matter, that is, the tourists. For the tourists’ study 211
foreign tourists from all major countries comprising the tourist demand centres, and 220
domestic tourists from all major tourist feeding states was conducted in a scientific

manner as enumerated in Chapter one. Further, all the 50 items related to each of the
thrust areas of the tourism policy were tested for reliability using Cronbach’s alpha, and
the results are summarized in Table 6.1, below

                       Table: 6.1   Reliability Statistics- Tourists
  Cronbach's      Cronbach's Alpha Based on Standardized Items            N of Items
     .892                               .896                                  50

From the table it can be seen that the relablity coefficient based on standardized items
is .896 which is in the ‘good’ range.

6.4.1.i Socio- Economic and Visit profile of Tourists

The socio- economic profile of the respondents matches the tourist market in Goa as
perceived by the scientific community. Respondents were mainly male, married, over 30
years of age, better educated, belonging to middle income group, mostly employed with
a private sector bias, and majority travel in groups either with family or friends (although
those travelling alone is a sizeable 20 percent mostly foreigners); a sizeable percentage
of domestic tourists travel by train and bus, with air and own vehicle travel among
domestic travellers registering growth; majority of the foreign tourists stay 2-3 weeks,
with a sizeable number staying for shorter duration; while majority domestic tourists stay
for 3-5 days, with a sizeable number also stay longer, this is in keeping with the master
plan estimates and corresponds to the fact that VFR numbers are growing in Goa with
many Goans having migrated abroad. The DOT mentions a lower number (9 days) as the
average days of stay for foreign tourists as it does not take VFR into consideration (Field
Study); majority of the tourists have planned their holiday by themselves indicating the
importance of web booking of holidays as a distribution channel, and an information
source for tourists; a sizeable 25 percent have visited Goa earlier, again in keeping with
earlier findings of Goa being a repeat destination for visitors both domestic and foreign;
majority did not find spending in the destination higher than planned, but this number
was still a sizeable 29 percent with foreign tourist comprising more than 10 percent of
this figure; the top-of-mind image of the destination is its ‘popular holiday destination’
followed by heritage, history and culture, with nearly 8 percent thinking casino when
asked what the word Goa first brought to mind.

6.4.1.ii Tourist Perception Study of Tourism Policy Parameters

Goa formulated a separate tourism policy in 2001, the printing date on the Official
Booklet being September, 2001. This means that Goa had formulated a separate policy
for the sector before the National government had formulated its new policy in
2002.Even so; Goa’s Tourism Policy has drawn from the Draft National Tourism Policy
of 1997, which was the basis for the national policy. Goa’s tourism policy has kept all
the thrust areas given in the Draft National Tourism Policy in mind although not
mentioning all these under individual titles except suvidha, swagat and samrachna. For
the study a six point Likert type Scale has been used, with responses 1 to 5 forming the
satisfaction scale. In that, ‘1’standsfor the highest negative response, and ‘5’ for the
highest positive response. Thus, Respondents were required to choose the level of
satisfaction they felt regarding a variable by indicating whether they were, Completely
Unsatisfied (1), Somewhat Unsatisfied (2), Neither Unsatisfied nor Satisfied (3),
Somewhat Satisfied (4), or Completely Satisfied (5), about a tourism policy component. A
further Can’t Say (6) option was also given, for those who did not have an opinion, or did
not want to give one, or simply were not aware. For some statements the five point scale
uses options of Completely Disagree (1), Somewhat Disagree (2), Neither Disagree nor
Agree (3), Somewhat Agree (4), and Completely Agree (5), as options to enable
respondents to express satisfaction with respective parameters, with a Can’t Say option (6)
as well. In some cases the respondents had to rate parameters on a five point scale between
Very poor (1), Poor (2), Neither Poor nor Good (3), Good (4), and Excellent (5), again
with a Can’t Say option (6). All these options were all converted in a way where; ‘1’
(Completely Unsatisfied; Completely Disagree; Very poor) represents the highest
negative response; and ‘5’ (Completely Satisfied; Completely Agree; Excellent) the
highest positive response for satisfaction with respective variables. The Tourist
Perception study considers seven broad thrust areas, namely, Welcome (Swagat),
Information (Soochana), Facilitation (Suvidha), Safety (Suraksha), Cooperation (Sahyog)
and Infrastructure Development (Samrachana) and Safai (Cleanliness).

6.4.1. ii.i Tourism Policy Parameter: SWAGAT (Welcome)
Swagat or welcome is an important thrust area of Goa’s Tourism Policy, with the
government being clear that it is required to “imbibe a positive culture amongst staff,
planners and the general public” (Goa Tourism Policy: 2001; 12) about tourism so that

tourists feel welcome and accepted in the destination and are treated as guests in the
   Indian tradition of ‘Athithi Devo Bhava’. A good welcome not just at the time of arrival,
   but a general sense of being trusted and accepted, is an important element of the total
   holidayexperience and a factor determining repeat customers to a destination. Table-6.2
   below examines tourist perception of this important parameter. A set of statements
   forming the variables for SWAGAT (Welcome) based on literature and the tourism
   policy document, were provided and respondents were required to choose the level of
   satisfaction they felt regarding respective variables on a six point Likert type Scale as
   indicated in the section above (6.4.2). The feeling of welcome on arrival was investigated
   as it forms tourists’ first

    Table-6.2: Tourist Perception of Tourism Policy Parameter: SWAGAT (Welcome)
      Response/Variable          CUS       SWUS       NUSNS       SWS      CS     CNS     Total
Feeling of Warm Welcome at       (10)       (42)       (207)       (99)   (19)     (1)    (378)
Airport/Railway/Bus Station      2.65      11.11       54.76      26.19   5.03    0.26     100
Friendly& Helpful Locals          (11)      (57)       (120)      (130)    (96)   (14)    (428)

                                 2.57      13.32       28.04      30.37   22.43   3.27     100
Overall Hospitality &
Behaviour of locals/officials     (10)      (69)       (191)      (109)    (33)    (2)    (414)
                                 2.42      16.67       46.14      26.33   7.97    0.48     100
                                  (12)      (27)       (120)      (142)    (87)   (11)    (399)
Goa is a Popular Destination     3.01       6.77       30.08      35.59   21.8    2.76     100
                                  (4)       (21)       (138)      (138)   (100)    (9)    (410)
Likely to Visit Again soon       0.98       5.12       33.66      33.66   24.39    2.2     100
                                  (47)     (216)       (776)      (618)   (335)   (37)   (2029)
OVERALL SWAGAT                      2.33     10.60        38.54     30.43 16.32 1.79 100.00
  Source: Field Survey, Note: Completely Unsatisfied- (CUS), Somewhat Unsatisfied - (SWUS),
  Neither Unsatisfied nor Satisfied- (NUSNS), Somewhat Satisfied - (SWS), Completely Satisfied -
  (CS), Can’t Say- (CNS). Figure in brackets are absolute numbers.

   impression of the destination. Here respondents were asked to also keep in mind their
   first impression of friendliness of locals and officials encountered; availability of
   welcome board (if seen); and other things that helped in forming a good first opinion.
   The last two variables namely Goa as a popular destination; and the desire to visit Goa
   again among tourists; were used as balancing variables in case an answer or two were
   given without proper consideration or reading or application of mind. Table above shows
   that positive responses of the tourist for Swagat outweigh the negative responses. This
   indicates that tourists are happy with the feeling of welcome, including friendly and

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