As the Corona crisis hits every nook and corner of the world, the Northeastern state of Sikkim is fearing a long-term economic crisis in the state, as a major part of its economy relies on tourism. While the whole of India is looking at a possible recession due to the COVID-19 outbreak across the world, and impacting India as well, the state of Sikkim is looking at a very difficult time ahead, as the state’s most important revenue source, which is tourism has taken a major hit. Amarjyoti Borah writes

The state is rich in hydro power potential, but tourism is more important as rural tourism in the state caters to the economic growth of thousands of families in the rural areas in the state, and this growth has been expanding every year in the rural areas of the state. It is important to mention here that in the last decade, tourism sector in Sikkim has seen a growth rate of 10-12 %. The Gross State Domestic Product of tourism sector in 2016-17 has been valued at Rs 1,44,735 lakhs with a total contribution of the tourism sector to the GSDP being 7.68% .

However, this year the state has been hit badly by the impacts of the COVID-19 outbreak, and the state is staring at a very bad situation in the tourism industry, especially for those rural tourism entrepreneurs who are running tourism business in the rural areas of the state.

After the new government came to power last year at Sikkim, both the Sikkim government and the tourism entrepreneurs were looking forward and hoping for a good turnout in the industry.

Nevertheless, post the COVID-19 outbreak the situation seems to be alarming. The Sikkim government was forced to ban the entry of foreign tourists to the state, and along with that the state government also had to postpone the Red Panda Tourism Carnival, the cultural extravaganza hosted annually to promote the state. Chief Minister Prem Singh Tamang on March 16 banned the entry of foreign and domestic tourists into the state and shut down public places such as educational institutes till April 15 in view of the novel coronavirus outbreak.
The festival was to be held in the middle of April at Soreng- Chakung in West Sikkim, but now it has been postponed, and according to Aditya Tamang, the local MLA, a decision on the event will be taken later.

“Initially no one had imagined that the situation will be such serious, and almost everyone was hoping that the situation will normalize and tourists will be able to come again towards the end of the tourism season. But now it is moving towards a very serious and unprecedented situation,” said a tour operator in Gangtok who organizes packaged tours for both domestic and foreign tourists every year.
“It is obvious that the coronavirus will have a massive impact on tourism this year. However, the decisions of the state government and the Dzumsas are understandable. Public health should always come first,” said a tour operator.

The Sikkim government is also worried about those who have taken up small entrepreneurship in the tourism sector as a means of survival, basically those who have set up small home-stays with loans and support, and are dependent on it as a full time livelihood source, as even a single bad season hampers them.

According to government sources of Sikkim, initially like all other state governments, even the Sikkim government was not aware that the problem will be so massive, and now the state is brainstorming ways to minimize the damages caused to the tourism entrepreneurs, basically the small scale entrepreneurs.

“The government is planning now, after seeing the extent of the irreparable damage, to prepare a package and also a plan of engagement with these entrepreneurs-both big and small, so that they don’t suffer hugely and will be in position to bounce back next year,” said a senior official of the Sikkim government.

As per sources, once the situation stabilizes, the Sikim government is also likely to approach the central government for a special package for the tourism sector in the state, as immediate relief is much required at this juncture.

“The government also plans to explore various schemes and missions under which some sort of engagements could be carried out, maybe in the off tourist season, so that they will have some resources for the next tourism session,” said the official.