Bhubaneswar, Aug. 20: Restriction of foreigners’ visit to tribal areas and abduction of two Italian nationals by Maoists this year have had its telling effect on the state’s tourism.

Aware that the dwindling number of foreign tourists could adversely affect the state’s economy, the state government is all set to give a boost to the sector through a tourism policy. A draft policy resolution, which is being discussed at various foras with the stakeholders, explores new vistas such as spa tourism, eco-tourism and adventure tourism. The government is toying with the idea of relaxing restrictions on visit of foreigners to the tribal-dominated areas.

The Maoists abducted two Italian nationals — Claudio Colangelo and Paolo Bosusco — from Kandhamal forests on March 17 midnight. The state government had, on February 25 this year, restricted the foreigners’ access to the tribal areas and made it mandatory for the district magistrates to grant permission for such visits.

Following an outcry against the state “parading” its tribal people for “money”, the government had initiated criminal cases against tour operators facilitating such visits.

“We are now witnessing its impact,” said a travel operator. Tour agencies and hoteliers say foreign tourists have almost stopped visiting the state since the past three months. “Nearly 70 per cent foreign tourists are primarily interested to visit the tribal areas,” president of the Odisha Tour Operators’ Association Timir Baran Patnaik told The Telegraph.

“I used to handle 500 to 600 clients every season. But, bookings have come down to almost zero since March. Foreigners are not willing to wait for days for the district collector’s permission,” said Srikant Mishra, another tour operator.

“The occupancy of hotels by foreigners has come down drastically since the past three months,” said chairman of the Hotel and Restaurants of Odisha J.K. Mohanty.

State’s tourism minister Maheswar Mohanty admitted that there had been a drastic fall in the inflow of foreign tourists to the state. Last year, as many as 60,722 foreign tourists visited the state, but this year, the footfall was negligible. “I will urge the chief minister to relax certain restrictions on the visit of foreign tourists to the tribal-dominated areas,” said the minister.

“The permission can be issued at the state secretariat, instead of empowering the district collectors to accord it,” said an official.

The state government is also formulating a new policy for extending financial incentives to tourism related industries. “We have gone beyond the traditional spectrum of tourism industry and incorporated non-conventional and potential sectors,” said tourism secretary Ashok Kumar Tripathy.

The government offers incentives to woo investments in health farms, wellness spa, wildlife safaris, adventure, beach and water sports, apart from heritage hotels, star hotels in the Koraput-Balangir-Kalahandi (KBK) region, three-star and above category hotels in other locations, restaurants, wayside and public amenities, arts and crafts villages, theme-based entertainment centres and amusement parks, golf courses, cruise boats and houseboats.

The financial incentives suggested in the draft tourism policy include land allotment at concessional price, capital investment and interest subsidies, exemption of stamp and electricity duties and reimbursement of various taxes, including value-added and entertainment.

“The policy is expected to be finalised within a couple of months,” said Mohanty, who held a meeting with the tour operators and hoteliers on August 14.

The state government has allowed certain financial incentives to priority sector industries under the Industrial Policy Resolution-2007. However, the state does not have a policy exclusively for tourism industries since 1997 when the existing policy expired.

The draft policy has proposed a capital investment subsidy for all tourism projects with a minimum investment of Rs 10 lakh at the rate of 10 per cent of the project cost (maximum limit of Rs 1 crore). There are also proposals for an additional 5 per cent subsidy for the tourism projects proposed to be set up in undivided KBK, Kandhamal and Gajapati districts. The draft also proposes to extend interest subsidy between 3 and 5 per cent.

Apart from providing land at concessional rates for new projects, the government proposes to give 50 per cent exemption of stamp duty and reimbursement of electricity duty at the rate of 75 paisa per unit of actual consumption. All tourism projects with a minimum investment of Rs 1 crore are proposed to get 100 per cent VAT reimbursement for five years (ceiling Rs 10 lakh per annum).

The other major benefits included 50 per cent road tax exemption for new air-conditioned buses operating in identified tourist circuits, 10 per cent capital subsidy for air-conditioned contract carriages and 100 per cent reimbursement of entertainment tax for five years for multiplexes with capital investments not below Rs 3 crore.

“It will be one of the best tourism policies in the country which will attract huge investments,” said Mohanty.