Govt to rope in pvt players to boost tourism

Realising that budgetary resources of the government may not suffice as far as large-scale infrastructure development goes, the tourism ministry is finalising a revised scheme for large revenue generating projects.

This scheme would bring in partnerships with private players as well as government and semi-government agencies.

These big-ticket projects have been identified either as tourist attractions or as projects that generate revenue through the levy of fees or user charges on visitors.

The ministry has already identified 10 projects for this scheme. The list comprises a convention centre at Surajkund, a luxury train in Karnataka, stringing passenger ropeways at Kodaikanal and Ooty, development of Bannerghata Biological Park near Bangalore, a marina at Bolghatty Island in Kochi and golf courses at Virajpet, Cochin and Chickmanglur in Karnataka.

Other projects that are being considered by the ministry include, cruise vessels, theme parks, mountain airlines and skiing resorts. Under the scheme, hotel and restaurant components will be supported as long as they do not comprise the dominant part of the project.

Amitabh Kant, joint secretary in the tourism ministry, said the promoters of the projects could include the private sector, joint ventures with public-private partnership, state governments, state public sector undertakings, central government ministries or departments such as the railways and central agencies like the port trusts.

During the selection process, priority may be given to projects that have strong private sector participation and/or to those that involve less subsidy.

If a private party is to promote the project, assistance will be released to a special vehicle company.

Kant said the maximum assistance under this scheme will be limited to 50 per cent of the equity contribution of the promoter, subject to the limit of 25 per cent of the total project cost or Rs 50 crore, whichever works out to be cheaper.

The ministry's financial assistance will be released in three installments.

The first, limited to 25 per cent of the assistance, will be released only after 25 per cent of the project has been contributed by the promoters.

The second installment, limited to 50 per cent of the assistance, will be disbursed after 50 per cent of the promoters' contribution comes through. The last installment will be provided by the ministry once the project is fully functional.