Karnataka unveils new tourism policy

Karnataka has unveiled its new Tourism policy, which aims to generate over 10 lakh direct and indirect jobs in the sector and INR 5,000 crore in investments by 2025. The Government aims to increase the contribution of tourism from 14.8% to 20% of GSDP by 2025.

Agri Tourism and Rural Tourism are the core tourism themes of the Policy with the objective to promote not just with agricultural and farming activities but also various aspects of rural life in Karnataka such as local cuisine, culture, traditions, arts etc. The Tourism Policy encourages greater participation of local community in tourism. activities to create inclusive socio-cultural growth and generate economic benefits for the people of Karnataka.

Comprehensive development of tourism sector in the state with focus on the 5As: Attraction, Accommodation, Accessibility, Amenities and Activities.

A Tourism Development Fund has been established under KTIL as a strategic intervention for the development of Land Bank under Department of Tourism. A 360° marketing strategy shall be adopted to promote Karnataka in domestic and key international markets and to leverage Karnataka’s brand of “One State, Many Worlds” to attract higher tourist footfalls to position Karnataka as a most preferred destination. Comprehensive development of identified key tourism destinations in Karnataka with special emphasis accorded to the experiential aspects of tourism.

Heritage tourism shall be promoted with focus on the 2Es: Explore and Experience.

The Policy has given due importance to the role of tourism in achieving the Sustainable Development Goals set by the United Nations. District level Task Force shall be constituted in all the districts for ensuring tourism
development across the state. The Policy encourages an analytics-driven approach for planning and decision-making and provide innovative digital solutions to enhance the quality of services across the tourism ecosystem.

The Tourism Policy has identified 26 different types of tourism products that shall be promoted during the policy period with focus on the 3Cs – Culture, Craft and Cuisine.

Improve ease of doing business for the tourism industry and put in place the requisite institutional mechanisms to support the successful implementation of the policy.

An Investment Facilitation Cell shall be set up under the Department of Tourism to act as the nodal agency for enabling, facilitating and monitoring investments. Development of Wayside Amenities across Karnataka to improve the convenience and safety of tourists by offering standardized experiences through a range of facilities.

Enhance Karnataka’s position as a safe destination by ensuring a comfortable and inclusive experience for all tourists visiting Karnataka and by adopting safety and hygiene measures to adapt to the new normal.

Incentives, Subsidies and Concessions under Karnataka Tourism Policy 2020-25

 Incentives
1. Registration of Tourism Projects and Tourism Service Providers
2. Facilitation Support
3. Marketing Support for Tourism
4. Special Recognition for Sustainability Measures
5. Assistance for Sustainability Initiatives
Financial assistance up to INR 1 Lakh shall be provided for Tourism Projects undertaking sustainability measures such as water conservation and harvesting, adopting renewable energy sources, and adopting pollution control measures.
6. Collaboration with Tourism Aggregators and Online Travel Agents
7. Facilitate Inter-State Travel for Tourist Vehicles
8. Marketing Development Assistance
Financial assistance shall be provided for Tourism Service Providers recognized by
the Department of Tourism for promoting Karnataka Tourism in domestic and
international markets.
9. Tourism Excellence Awards
10. Support for Homestays

Subsidies
1. Capital Investment Subsidy
The following projects shall be eligible for Capital Investment Subsidy – Adventure Tourism Project, Caravan Park Project, Hotel Project – Budget (1-star or 2-star classification hotels / resorts), Hotel Project – Premium (3-star or above classification hotels / resorts), Houseboat Project, Wayside Amenities and Wellness Centre. The Capital Investment Subsidy shall be equal to 15% of the Eligible Project Cost (EPC) and shall be given to tourism projects in identified tourism destinations of Karnataka. Additional Capital Investment Subsidy of 5% shall be given to Tourism
Projects undertaken by Women, SC, ST, or differently-abled Entrepreneur.

Interest Subsidy
The following projects shall be eligible for Interest Subsidy – Agri Tourism Project, Cultural Tourism Project, Heritage Tourism Project, Safety and Hygiene Tourism Project.

Concessions

  1. Exemption on Stamp Duty
  2. Concessional Registration Charges
  3. Reimbursement of Land Conversion Fee
  4. Exemption on Motor Vehicle Tax
  5. Complementary Infrastructure Assistance
    Complementary Infrastructure Assistance may be provided for Tourism Projects for up to a maximum of INR 25 Lakh in the following forms – road access, last mile connectivity, power connectivity, water connection, sewerage connection and other infrastructure which becomes essential for the provision of the Tourism Project.

Anticipated Benefits of Karnataka Tourism Policy 2015-20
Under the proposed scheme for Capital Investment Subsidy and Interest Subsidy under Karnataka Tourism Policy 2015-20, the following table summarizes the minimum investment in the State’s tourism sector if the full amount under the subsidies was to be disbursed.

Projects eligible for Capital Investment Subsidy
1. Adventure Tourism Project INR 20 Crore INR 133 Crore 10
2. Caravan Park Project INR 10 Crore INR 67 Crore 5
3. Hotel Project – Budget INR 50 Crore INR 333 Crore 25
4. Hotel Project – Premium INR 250 Crore INR 1667 Crore 50
5. Houseboat Project INR 5 Crore INR 33 Crore 5
6. Wayside Amenities INR 50 Crore INR 333 Crore 25
7. Wellness Centre INR 20 Crore INR 133 Crore 10
Sub-Total INR 405 Crore INR 2699 Crore 130 Projects

Projects Eligible for Interest Subsidy
1. Agri Tourism Project INR 1.87 Crore INR 37.5 Crore 25
2. Cultural Tourism Project INR 0.75 Crore INR 15 Crore 10
3. Heritage Tourism Project INR 0.75 Crore INR 15 Crore 10
4. Safety and Hygiene Tourism Project INR 1.13 Crore INR 22.5 Crore 15
Sub-Total INR 4.5 Crore INR 90 Crore 60 Projects
Total INR 409.5 Crore INR 2,789 Crore 190

Hence, through the disbursal of INR 409.5 Crores in subsidies over the five years of the policy period, a minimum investment of INR 2,789 Crore (USD 372 Million) is expected for Karnataka’s tourism sector. This investment shall lead to the creation or significant expansion of 190 Tourism Projects in Karnataka.

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