ITDC cruises into seaports with duty-free outlets

From airports, the India Tourism Development Corporation is shifting its retail gaze to seaports.

Its retail arm, Ashok International Trade Division (AITD), has been steadily cruising into seaports across the country setting up duty-free outlets.

For instance, on Tuesday morning, ITDC officiating CMD and Director Commercial & Marketing Piyush Tiwari was at Krishnapatnam port in Nellore district, inaugurating a new outlet along with Anil Yendluri, CEO of the port.

“Next month we may open one at Tuticorin followed by Kandla Port later,” said Tiwari, outlining ITDC’s ambition to cover all the seaports in India.

Krishnapatnam is the 11th seaport where ITDC has set up a duty free shop.

“My target is that by 2018-19 we should cover all the major ports in the country with our duty-free outlets,” says Tiwari, hastening to add: “Of course it depends on the port authorities as well.”

At present, ITDC has outlets in Mumbai, New Mangalore, Chennai, Goa, Paradeep, Kolkata, Haldia, Vishakapatnam , Cochin, Kakinada and Krishnapatnam ports.

According to Tiwari, the seaport duty-free outlets are aligned with the Ministry of Tourism’s ambitious plans to create cruise tourism around India’s coastal towns. Shopping facilities are part of this plan.

He also says the outlets are seeing good footfalls from crew of cargo ships that arrive at these ports. Apart from the standard alcohol, perfume, chocolates and cigarettes mix, it is now adding Indian tea and tribal handicrafts.

“We want to showcase Indian crafts here and are talking to suppliers of these goods, he says.

Tiwari points out proudly that in this bid-oriented business even the private ports – Kakinada and Krishnapatnam — have chosen to go with ITDC for the duty-free outlets.

Out of airports However, AITD which was the pioneer in setting up duty-free outlets in India’s airports — a really booming business now — has practically no presence there now.

Its lease to operate the duty-free outlet at Coimbatore International Airport recently expired and the tendering process is still on.

Ever since India’s airports began privatising, the contracts have been steadily moving to private players. At T3 in the Capital, for instance, Delhi Duty Free Services, a joint venture between DIAL, Yalorvin Limited (Aer Rianta) and GMR Airports has been cashing in on the lucrative travel retail market. A spokesperson of DDFS says it has seen double digit growth in the last few months with sales hitting a record high in June. In Bangalore, a joint venture between Nuance Group, a Zurich based firm and Shoppers Stop operates the duty free outlet.

According to industry sources, the size of the duty free market in India is estimated at around $550 million and is expected to touch $1 billion by 2020.The global duty free market is expected to touch US $64 billion by 2020, according to Verdict Retail, a retail information specialist. Its report says Korea is the largest duty free market, followed by China, but India is one of the fastest growing ones, and forecasts an annual CAGR of 20.7 per cent for India.

ITDC’s turnover was ₹495. 14 crore in 2016-17, a growth of 6.32 per cent compared to ₹465.69 crore a year before.

Hotels contributed over 50 per cent of the turnover of ITDC’s total turnover, but Tiwari says he sees high revenue potential in other divisions, especially duty-free. It generated revenues to the tune of ₹1,896.16 lakh from the duty-free business in 2016-17.