India is giving out free visas for half a million tourists

• The total financial implication of the free tourist visa plan would be ₹100 crore.
  
• The free visa will be available to a tourist, only once, coming to India.
  
• Indian government has also announced a loan guarantee scheme for registered tour guides.
  

The government of India is offering free tourist visas to over half-a-million (five lakh) tourists visiting the country by next year. This step has been taken to re-energise India’s tourism industry, which has taken a huge hit by the COVID-19 pandemic in 2020 and 2021.

India’s Finance Minister Nirmala Sitharaman, during a press conference held on June 28, announced that on an average, daily stay of a foreign tourist in India is 21 days and the average daily spending is $34 (₹2,400). Once the issuance is restarted, the first five lakh tourists visas issued till March 31, 2022, will be issued free of charge.

The benefits will be available only once per tourist, Sitharaman added. The total financial implication of the move is expected to be ₹100 crore. The finance minister also added that 10.93 million foreign tourists visited India in 2019 and spent $30 billion on leisure and business.

Besides this, the union government has also announced financial support to more than 11,000 registered tourist guides, and travel and tourism stakeholders. For instance, about 10,700 regional level tourist guides and travel and tourism stakeholders will be offered loans under 100% guarantee schemes.

These guides should be registered with the Ministry of Tourism and their respective state governments. "No processing charges” will be imposed on the guides, the ministry has emphasised.

Overall, Sitharaman has also announced a ₹1 trillion loan guarantee scheme for COVID-19 affected sectors like healthcare. In addition, the minister has announced an additional ₹1.5 trillion to the Emergency Credit Line Guarantee Scheme (ECLGS), which provides coverage to the banks, non-banking financial institutions (NBFCs) and other lending institutions.

The relief package announced today is for stressed loans through the credit guarantee scheme, which facilitates loans of up to ₹1.25 lakh per individual. The scheme aims to cover 25 lakh people through micro finance institutions (MFIs). The interest rate on each of these loans from banks is capped at marginal cost of funds-based lending rate (MCLR) plus 2%.

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