Potentiality of Tourism Entrepreneurship in Sikkim

Abstract: Alpine State Sikkim has immense potentiality to develop and nurture tourism

as a mean of income and employment opportunity. Sikkim is one of the very few Indian

states with a distinctive characteristic of having a significant influence of tourism

through its economic and socio-cultural contribution. Tourism as a mean of economic,

socio-cultural and environmental development has brought about several questions. So

present tourism development needs an assessment to ensure a proactive and sustainable

orientation. This sustainable development orientation and its practical implication will

be a bumptious statement without equitable development with dignity and justice. The

present article addresses issues involved in equal income and job opportunities through

an analysis of destination environment and entrepreneurial potentialities. A destination

TOWS analysis has been conducted and regional disparities have been addressed to

formulate an entrepreneurial policy justifying equal development and scope for all in

Sikkim.

JEL Classification : E21, M13, M54, O17, P41, P52, Q56

Key Words: TOWS Analysis, Destination Entrepreneurship Development, Community

Development, Destination Investment Cell, Tourism Entrepreneurship Development Cell,

Sustainable Entrepreneurial Opportunities

Introduction and Development of Sikkim as a Tourist Destination

Sikkim is a small hilly state, bounded by vast stretches of Tibetan plateau in the North,

the Chumbi Valley and the kingdom Bhutan in the East, the kingdom of Nepal in the

west and Darjeeling (West Bengal) in the South. Its latitude is 27030l north and the

longitude is 88030l east. Sikkim is famous for scenic valleys forest, snow clad mountains,

magnificent Buddhist culture and heritage and peace-loving people. Though small, the

environmental, social and cultural diversities are not so. Some scholars believe that the

word Sikkim involves Nepalese dialect and it refers to a ‘now place’ or the term has been

derived from a Sanskrit word which means a ‘mountain crest’. The people of Sikkim

have ethnic diversity. The Bhutias came from Tibet, the Lepchas were the aboriginal

community and the Nepalese came from Nepal. When Sikkim was an independent state it

faced many invasion by its neighboring countries and the king took the help of the British

India and, later, gifted some of its region including Darjeeling to the British India. Now

this 22nd Indian State (joined Indian Union in 1975) has Over 81% of the total

geographical area under the administrative managerial control of the Ministry of

Environment and Forest, Government of India. Over 45% of the total geographical area

of the state is under tree cover and nearly 34% of the geographical area is set aside as

protected area network in the form of national park and wildlife sanctuary. The basic

statistics of flora and fauna are given here under.

Flora and fauna of Sikkim

Mammals 144 species

Birds 550 species

Butterflies and Moths 650 species

Reptiles 33 species

Frogs 16 species

Orchids 550 species,95 Genera

Rhododendrons 36 species, 45 varieties

Flowering Plants Over 4000 species

Ferns and Allies 300 species

Conifers 9 species

Medicinal plants Not enumerated

Source: Economic Survey 2006-07, Govt. of Sikkim

The maximum summer temperature 280C and minimum winter temperature is 00C.

Sikkim has a variety of mineral resources including coal, limestone, iron ore, graphite,

pyrite etc. The temperature in the bottom of the valleys (up to 600 meters) situated at

lower elevations, particularly during summers, are similar to the monsoon type of

climate. The temperature starts falling between 600 meters to 2000metres above sea level

enjoys cool temperature climatic conditions and further up (2000 meters to 3000metres) it

is cold temperate climate. Arctic type of climate is found above 5000 meters.

Sikkim at a glance

Area 7096 sq.km.

Population(2001 census) 540493

Growth rate(1991-2001) 32.98%

Density per square km. 76

Sex ratio( female per 1000 male) 875

Literacy rate

Male

Female

69.68%

76.73%

61.46%

Capital Gangtok

No. of districts 4

Legislature Unicameral

Principal languages Nepali, Lepcha, Limbu

Assembly seats 32

Lok Sabha seat 1

Rajya Sabha seat 1

Judiciary(name and location) High court of Sikkim at Gangtok

State day May 16

Source: Economic Survey 2006-07, Govt. of Sikkim

Sikkim is ecologically a fragile region. The state has the responsibility to conserve its

rich biological diversity that includes coexistence and protection of over 5000 species of

angiosperm (one third of the total national angiosperms). Again this place has multi-

ethnic communities. So the need for ecological, cultural and social diversities is not only

essential but imperative as well.

After becoming 25th state of the Union Government of India in the year 1975 the rapid

development activities ushered in a new era of tourism in Sikkim. Increased accessibility

by roadways and air transport, rapid socio-economic development, competitive advantage

both from the side of the destination and geographical proximity to tourist generating

states contributed to the development of tourism in Sikkim. Recognizing the increased

tourist arrivals, accommodation units were set up in Gangtok and a few towns mostly by

outsiders without proper land use planning and architectural design.

Source: Sikkim Tourism Development Corporation,2009

Ever increasing tourist arrival and increasing dependence on tourism as a powerful

industry and employment generating source, restoration of peace and harmony,

hospitable people, plenty of diversified natural and cultural resources, a typical interest of

the people of Indian to discover the unknown hidden Sikkim brought about a new

dimension for the development and marketing of tourism in Sikkim.

Another important market trend for Sikkim was to interpret a positive and highly

significant correlation between the personal consumption of Indian population and

domestic tourist arrivals of Sikkim. The graph given below interprets a positive and

highly significant correlation( t0.05,9 = 1.833, i.e. tcal > ttab, i.e. H0 rejected ) between the

personal consumption of Indian population and domestic tourist arrivals of Sikkim. Here

we recognize the significant ever increasing trend of both the variables involved and it

has been assumed that a segregated part of the total personal consumption is travel and

tourism. The data of personal consumption of the population and the domestic tourist

arrivals for the last eleven years i.e. from 1998 to 2008 have been considered.

Source: www.wttc.org and Sikkim Tourism Development Corporation

This increasing trends of tourism industry draw the attention of many entrepreneurs and

investors in and outside Sikkim. But the development features and consequent

entrepreneurial efforts largely vary. An overall analysis of tourism environment and its

development is expressed through TOWS ( Threats, Opportunities, Weaknesses and

Strengths).

This analysis is based on the development initiatives of the State Government, NGOs,

and other concerned authorities, and recent field visit. Following points were considered

for TOWS (Threat, Opportunities, Weaknesses, and Strength) analysis.

Internal factors

Internal strengths (S) Internal weakness (W)

* Improved public image

* Improved land use planning

* Renovation of product portfolio

* Higher staff commitment & better labour relations

* Creativity & openness to face new challenges

* Better relations with public authorities, Central Government,

local community & green activities groups

* Assured access to foreign markets

* Easier compliance with environmental standards

* Ever increasing growth of tourism

* Peaceful, calm & tourist friendly state, compared to all North

Eastern states in India

* Diversified & multi ethnic communities

* Rich culture & heritage of the community

* Available labor market

* Possibility of getting domestic & international tourists

* Available land area practicing marginal agriculture

* Plenty of natural resources

* Proactive environmental legislations

* Lack of consciousness of hygiene &

health related issues

* Population is increasing

* Centralized development of

infrastructure &superstructure

* No international airports in or around

states

* Lack of local entrepreneurship

* Unorganized & uneducated local

people

* Lack of basic facilities & infrastructure

for tourism development

* Lack of effective administration with

sufficient authority

* Tending to seasonal economy

* Lack of comparability with

complementary development of tourism

in other states

* Lack of long vision to articulate &

integrate & to enhance benefits for all

* Lack of money to assist the

organization of events

* Lack of acceptance of the necessity for

environmental controls by the destination

developers, community etc.

* Lack of mechanism for linking

interested parties. Community

participation is not as high as it should or

would be

* Lack of mechanism for linking

interested parties. Community

participation is not as high as it should or

would be

* Lack of accommodation and adequate

facilities

* Lack of collection of important

statistical data

* Almost the same attraction features

throughout the states

* Evidence of environmental degradation

in many tourist centers

* Cost of advertising, maintenance

( Research and Development)

External factors

External opportunities

(O)

SO Strategy: (Maxi –

Maxi)

WO Strategy:(Mini – Maxi)

Contd.

- Cost savings due to

* Reduced consumption of

energy and other resources

* Recycling, selling of by-

products and wastes, resulting

in decreased waste disposal

costs.

* Reduced environmental

* Employment generation

increases

* Small scale industries

develop specifically wine

industry, traditional

medicines, spices etc.

* Standard of living of the

* Condition of health and hygiene and

the quality of life of the local people can

be improved by increased income and

employment from tourism

* Possibility of employment generation

with local entrepreneurship

* State population can be more educated

charges, pollution penalties,

and consumption following

legal damage suits

- Revenue increases due to

* Increased marginal

contribution of Green

Products which sell at higher

prices

* Wine industry, spices,

traditional medicines etc.

* Increased market share due

to product innovation and

decreased number of

competitors.

* Completely new products

that open up markets

* Increased demand for a

traditional product, which

contributes to pollution

abatement

* Availability of funds from

central government and other

international organizations

* Scope for tourism round the

year with distinct attraction

features

* Increased number of tourists

* Alternative employment

opportunity

* Care for the environment,

socio-cultural needs and

governance build strength

* Educational opportunities:

children and youth activities

* Recreational opportunities:

local people will increase

* Balanced regional

development and

minimization of regional

imbalances

* Conservation and protection

of the environment

* Per capita income will

increase

* Development of local

cuisine, hospitality,

handicrafts, handlooms etc.

* Development of non

conventional energy resources

and organized with increasing

educational measures

* Fund generation is possible with the

help of different schemes and projects of

various national and international

organizations

* Seasonality in tourism can be reduced

with the development & promotion of

alternative attractions during the lean

season

retirees

* Residential care services:

the aged

* Local town services: rural

residents

* Health services: community

* Heritage and natural

environment: tourism

operators

* Importance of local fairs and

festivals will increase

* Development of inaccessible

and backward areas

External threats (T) ST Strategy: (Maxi – Mini) WT Strategy: (Mini –

Mini)

* Tourism development may

cause environmental

degradation

* Encroachment over

agricultural/industrial land

areas

* No sufficient

accommodation units in many

areas of tourism importance,

* Commercialization of

culture and deterioration of

social values

* Restriction of freedom of the

residents to enjoy their

resources and other basic

* Application of environmental

legislation & eco tourism policy to

reduce the environmental damage

* Land use planning prevents the

encroachment over agricultural &

other land areas

* enforcement of strong law & order

in coordination with other authorities

to check crime rates that may arise due

to the development of tourism

* Awareness of rich culture & heritage

of the community along with the

values of the society can prevent the

commercialization of culture & its

* Minimization of weakness &

threats are possible with the

suitable joint venture, local

people participation in

developing supplementary

accommodation

* Adding values to the existing

products by alternative cultural

& heritage related attractions,

optional tours, new trek routes,

infrastructure for adventure

tourism

* Conducting environmental

awareness camps, encouraging

participation & consultation in

amenities

* Changes in occupational

distribution and lack of

occupational mobility

* Increase in crime rates

* Existence of substitute

tourism products in

neighboring states may reduce

tourist arrivals

deterioration

* Scarcity of accommodation units

particularly during the peak season can

be reduced by development of

supplementary accommodation units,

e.g. the local village / people/eco clubs

offering rental accommodation.

major decisions related to the

environmental protection &

maintenance of quality

Though the TOWS matrix explains the development and promotional issues of tourism

businesses in Sikkim yet the conditions at regional level is not so. There are so many

regional differences and disparities though the destination is primarily known as a leisure

tourism destination. The conditions of tourism development opportunity were measured

with the help of industry impact variables at three different places viz. the capital city

Gangtok, heritage tourism domination Namchi and a comparatively new destination

Lachung in North Sikkim. Six questions were asked to one hundred respondents to assert

their opinion in three different places.

The questions were related to the

(i) degree of importance between hosts and guests,

(ii) importance of outside investment for site development,

(iii) need for tourism legislation,

(iv) appropriate types and forms of tourists,

(v) the initiatives taken by the government to use tourism as a community

development tool and

(vi) sustainability of attraction features.

All these questions have direct implications and are oriented to destination entrepreneurship

development and other related issues.

These questions were replied with the help of the five point scale varying from strong

disagreement to strong agreement. Surprisingly, an interesting result came into light

when their degree of importance were ranked with Kruskal Wallis rand test.

The results of three places are given here under.Namchi Mangan Gangtok

Test Statistics Test Statistics Test Statistics

VAR00001 VAR00001 VAR00001

Chi Square 26.308 18.253 47.364

Df 33 22 41

Asymp.Sig .789 .691 .229

a.Kruskal Wallis Test

b. Grouping Variable: VAR00002

a.Kruskal Wallis Test

b. Grouping Variable: VAR00002

a.Kruskal Wallis Test

b. Grouping Variable: VAR00002

The implications of all six industry/ impact variables were different as the degree of

importance put by respondents in all three destinations largely varied considering the

significance levels of 0.789, 0.691 and 0.229 for Namchi, Mangan and Gangtok

respectively. The variation among these three places are due to variation of putting rank

for each question.

All six questions were ranked with different importance and the difference were largely

destination specific as all the destinations had distinctive economic, socio-cultural and

ecological problems and prospects.

ConclusionThe potentiality of entrepreneurship development can be better exploited by promoting

tourism as a mean of rural entrepreneurship development. This is how rural

entrepreneurial mobility can be ensured to tap opportunities in village areas and thereby

to set up economic and social justice to poor and vulnerable sections of the State.

An initiative to be taken to categorize direct and indirect job opportunities provided by

the tourism sector in the State and thereby to arrange loans, grants and such other

investment incentives.

An analysis for Skills required in different types of jobs provided by the tourism industry

needs to be assessed to ensure or suggest training program for different sections in the

society. Proactive and sustainable tourism development initiatives will automatically

ensure economic and social justice for which local authorities, NGOs, eco-clubs must

come forward and work with the proper coordination and control.

Changes in marketing policy with an entrepreneurial perspective, its linkage with

economic, socio-cultural and environmental sustainability will ensure sustainable

entrepreneurship also in the state.

The state tourism corporation should have a special cell to encourage and appreciate

tourism development projects primarily with two types of job opportunities e.g.

institutionalized and non-institutionalized. Two different types of investment incentives

and fiscal control measures to be adopted for both the sectors.

There is an urgent need to identify and assess all important informal and subsidiary

sectors of tourism industry with their respective economic and social values. The concept

of micro credit and economic inclusion needs to be reassessed with an importance to

tourism.

Last but not the least, the development of tourism and entrepreneurial opportunities needs

to be region specific to adopt more effective and result-oriented tourism as there are

disparities in resource allocation, fund allotment, demographic and socio-cultural profile

of local community as a whole. So, tourism entrepreneurship awareness program, access

to all required facilities to set up tourism business by local entrepreneurs, community

development program through alternative tourism and adventure tourism and an

improved destination management with sustainable development philosophy will bring in

more sustainable entrepreneurial opportunities among the local community through

sustainable development.

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