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The tourism industry accounts for 70 per cent of the town's economy.
Joshimath is staring at a long winter as locals have fled the town and tourism has ground to a halt because of land subsidence there.
The town, which has about 17,000 inhabitants and over 50 hotels, has been declared 'disaster-prone' by the government.
Considered a transit town for those travelling to key tourist destinations including the pilgrimage sites of Badrinath and Hemkund Sahib, Joshimath's key business, tourism, is set to take a big hit.
On Monday, the government announced that two hotels badly affected by land subsidence in Joshimath would be demolished. So far, 678 buildings in the town have been marked unsafe.
The tourism industry plays a vital role in the town, accounting for 70 per cent of its economy, according to experts.
The town hosts millions of devotees every year, which also generates allied jobs for its residents.
Most hotels in Joshimath have closed operations, and some said they were already incurring operational losses.
"The winter season is ruined," says Shrikant Dimri, owner of the Hotel Mount View Joshimath. "Revenue has plummeted over 80 per cent for the majority of hotels. No new tourists are coming now." Dimri, too, shut his hotel.
Though Dimri was worried about how he would pay the salaries of his 15 employees, he was hopeful that the beginning of the Badrinath Yatra in April would breathe life into the industry.
"A lot depends on how much Joshimath sinks," Dimri adds.
According to the Uttarakhand tourism ministry's data, in 2021, over 165,000 tourists visited Joshimath. However, more than half a million tourists transited through the town to visit destinations like Badrinath, Auli, and Hemkund Sahib.
Speaking to Business Standard, a tourism development officer from Chamoli district said the tourism industry had taken a severe hit.
The damage wasn't just limited to hotels, but to all small businesses associated with the industry.
A panel of experts that was tasked with assessing the situation in Joshimath said it was yet to narrow down on the reason for the subsidence.
Ranjit Sinha, secretary in the disaster management department of the state, told mediapersons on Monday, 'All we know is land cannot bear the load. Our relief work is still on and until then there will be no construction work done at the location.'
Experts have blamed unplanned infrastructure development, including hydropower projects, for the alarming situation.
The fear in Uttarakhand is that the Joshimath incident could also affect the state's image as a key tourism destination for both pilgrims and other tourists.
The state has more than 1,000 hotels and tourist stays, tourism industry insiders said.
The average cover per restaurant in the state was about 30 and each establishment employed around five persons on average, the industry officials said.
The industry's importance to the state is underscored by the aggressive media campaigns the local government has conducted in recent years.
According to a 2019 report by the National Council of Applied Economic Research, tourism was estimated to contribute 2.96 per cent directly to Uttarakhand's gross value added (GVA) and accounted for 11.8 per cent of employment in the state.
Including the indirect impact from linkages of tourism with other sectors, these shares work out to 6.59 per cent of GVA and 26.8 per cent of employment.
The report pegged the average expenditure of a foreign tourist at Rs 90,869 per visit. For domestic tourists from other states it was Rs 15,150, and for local tourists from Uttrakhand it was Rs 7,230.
Tourism is also a big draw for locals who enter the hospitality industry because of the high revenues.
According to the Uttarakhand Tourism Development Master Plan 2007-2022, the financial performance of the industry was encouraging with an average gross operating profit of more than 50 per cent.
However, the industry's demand for compensation from the government might not be met just yet.
The state government official quoted above said that the current evacuation drive would take precedence. "That (discussion with industry) will happen at a later stage."
Feature Presentation: Ashish Narsale/Rediff.com
