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Development of Tourism related Infrastructure near Malaprabha Dam, Belagavi

Development of Tourism related Infrastructure near Malaprabha Dam, Belagavi INFRASTRUCTURE – Possibilities Unlimited…. Final Feasibility Report

INFRASTRUCTURE Possibilities Unlimited….

Final Feasibility Report

March 2015

Infrastructure Development Corporation (Karnataka) Limited #9/7, K.C.N Bhavan, Yamunabai Road, Madhavnagar Extension Off Race Course Road, Bangalore 56 0001 Ph: +91-80-43448000. Fax: +91-8043448001 Website: www.ideck.in

Submitted to:

Karnataka Neeravari Nigam Limited (KNNL)

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

Table of contents

  • 1. Introduction

6

Background

  • 1.1 ..............................................................................................................................

6

Objectives

  • 1.2 ................................................................................................................................

6

  • 1.3 Approach and Methodology

7

  • 2. Regional Profile

9

  • 2.1 Location and Regional Settings

9

2.1.1

Demographics

....................................................................................................................

10

  • 2.2 Regional Connectivity

11

  • 2.3 Economy ................................................................................................................................

12

Education

  • 2.4 ...............................................................................................................................

12

Tourism

  • 2.5 ..................................................................................................................................

13

  • 3. Site Analysis

16

Introduction

  • 3.1 ...........................................................................................................................

16

Location

  • 3.2 .................................................................................................................................

17

  • 3.3 Site features and Surroundings

18

Connectivity

  • 3.4 ...........................................................................................................................

18

  • 3.5 Accessibility to key locations

19

  • 3.6 Development Control Regulations

19

SWOT Analysis

  • 3.7 .......................................................................................................................

20

  • 4. Perception Analysis and Consultations

21

Introduction

  • 4.1 ...........................................................................................................................

21

  • 4.2 Perception Survey Findings

21

  • 5. Identification of Project Facilities

26

  • 5.1 Competition Analysis

.............................................................................................................

26

5.1.1

Hospitality Segment

26

  • 5.2 Proposed Facilities

29

  • 4.3 Demand Assessment

30

  • 4.4 Fee Structure

.........................................................................................................................

32

  • 4.5 Viability Assessment

33

  • 5. Financial Feasibility Assessment

34

  • 5.1 Area Assumptions

34

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report Table of contents 1.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

  • 5.2 Assumptions..............................................................................................................

Costing

34

Estimated Project

  • 5.3 Cost...........................................................................................................

34

  • 5.4 Financial Assumptions

35

  • 5.5 Operating Assumptions

35

  • 5.6 Sensitivity

Analysis

38

  • 6. Project Structuring Options

40

  • 6.1 Review of different PPP Frameworks

40

  • 6.2 Proposed Structure

................................................................................................................

41

  • 6.3 Responsibility of the developer

42

  • 6.4 Implementation Structure

43

  • 6.5 Risks assessment ....................................................................................................................

44

  • 6.6 Types of Bidding

.....................................................................................................................

44

  • 6.7 Salient features of Instruction to Bidders (ITB)

.....................................................................

45

  • 6.8 Salient Features of Draft Project Development Agreement (PDA)

47

  • 7. Way Forward

53

  • 7.1 Critical Success factors ...........................................................................................................

53

  • 7.2 Way Forward

53

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 5.2 Assumptions.............................................................................................................. Costing 34
 

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

List of Tables

 

Table 1: Distance between Belagavi and key Tier-I cities in Southern India

9

Table 2: Distance between Dharwad and key Tier-I cities in Southern India

10

Table 3: Physical Features of Belagavi

10

Table 4: Demographic profile of Belagavi and Dharwad

10

Table 5: Features of the Project Site

 

18

Table 6: Boundary and Surroundings of the Project Site

18

Table 7: Infrastructure status at the Project Site

18

Table 8: Distance of project site form key public transport nodes

18

Table 9: Distance of Project Site from Important destinations

19

Table 10: SWOT Analysis of project site

20

Table

11:

27

 

28

Table

13:

Tourist

Inflow

statistics 2011

28

Table 14: Tourist Inflow growth figures for the period of 2007-11

28

Table 15: Proposed facility in Hospitality segment

29

Table

16:

Proposed

Project

Facilities

29

Table 17: Footfall Projections for Proposed Facilities

31

Table

18:

Land-Use Mix for

Proposed Facilities

32

Table 19: Potential Clients/ Prospective Users for Proposed Facilities

32

Table 20: Fee Structure for Proposed Facilities

33

Table 21: Viability Assessment of Proposed Facilities

33

Table

22:

Area Assumptions

34

Table 23: Assumptions for CAPEX

 

34

Table

24:

Estimated Project

34

Table

25:

Financing assumptions

35

Table 26: Assumptions for Revenues from facilities

35

Table 27: Assumptions for O & M expenses of each facility

36

Table 28: Projections for Revenue and Operating Expenses

37

Table 29: NPV of Revenues, Expenses and PAT

38

Table 30: Project financial indicators

 

38

Table

31:

Sensitivity

Analysis

Review of

39

Table

32:

different PPP frameworks

41

 

41

50

51

Table 36: Force Majeure Events

 

52

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report List of Tables Table

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

List of Figures

Figure 1: Tourism related Infrastructure

7

Figure 2: Approach to the project

8

9

11

Figure 5: Malaprabha Dam in Belagavi

16

Figure 6: Renukasagar reservoir

16

17

17

22

Figure 10: Purpose of Visit by the tourists

22

Figure 11: Mode of Travel

23

Figure 12: Average Length of Stay

24

Figure 13: Frequency of visit of tourists

24

26

43

Figure 16: Types of Bidding

44

Figure 17: Critical Success Factors

53

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report List of Figures FigureFigure 3: Belagavi and Dharwad districts in Karnataka 9 Figure 4: Connectivity of Belagavi and Dharwad 11 Figure 5: Malaprabha Dam in Belagavi 16 Figure 6: Renukasagar reservoir 16 Figure 7: Location of project site 17 Figure 8: Project site and key neighbouring cities 17 Figure 9: Geographical distribution of Tourists 22 Figure 10: Purpose of Visit by the tourists 22 Figure 11: Mode of Travel 23 Figure 12: Average Length of Stay 24 Figure 13: Frequency of visit of tourists 24 Figure 14: Catchment area of the project site 26 Figure 15: Implementation Structure 43 Figure 16: Types of Bidding 44 Figure 17: Critical Success Factors 53 Infrastructure Development Corporation (Karnataka) Limited Page 5 " id="pdf-obj-4-113" src="pdf-obj-4-113.jpg">
Project Feasibility Report DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI 1. Introduction 1.1 Background

Project Feasibility Report

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

1.

Introduction

  • 1.1 Background

Karnataka Neeravari Nigam Limited (KNNL) is a company set up by Government of Karnataka (GoK) for planning, investigation, estimation, execution, operation and maintenance of irrigation projects in the Krishna river basin of Karnataka. It is responsible for protection and improvement of the environment, rehabilitation and resettlement of the people affected by development of irrigation projects, promotion of modern irrigation methods like sprinkler, drip, etc., use of new materials and technologies in building irrigation projects and promotion of schemes for utilizing water from the irrigation projects built by the Company. KNNL also supervises the works of Malaprabha and Gataprabha- Command Area Development Authority (M & GP CADA).

Infrastructure Development Corporation (Karnataka) Limited (iDeCK) has been providing financial and legal advisory services for PPP projects for the past fourteen years to several government and private sector agencies, across the country, in the areas such as project feasibility studies; development of sectoral policies and strategies; transaction advisory services including project structuring for private participation, bid documentation, project marketing to prospective bidders and assistance in negotiation, execution of contractual documents for PPP infrastructure projects and capacity building in various sectors including tourism, urban (water, solid waste management and commercial infrastructure), transport (roads, railways, ports, airports), industrial, energy and power.

KNNL has appointed iDeCK for assisting them in conducting a feasibility study for developing tourism related infrastructure at the identified site.

KNNL is in possession of around 3 acres (approx.) of land near Malaprabha Dam where it intends to develop tourism related infrastructure under an appropriate Public Private Partnership (PPP) framework to boost the tourist footfalls in the region.

  • 1.2 Objectives

In the upcoming Karnataka Tourism Policy 2014-19, a large emphasize has been laid on enhancing hospitality services and standards, promoting innovative developments and rejuvenation of older tourist attractions, with the aim of offering visitors the experience that will commensurate with higher expectations.

With similar objectives, KNNL intends to develop tourism related infrastructure near Malaprabha Dam to:

  • i. Attract footfalls, encourage extended stays and provide a wholesome experience to the tourists.

Project Feasibility Report DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI 1. Introduction 1.1 Background
 

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

ii.

Encourage entrepreneurship and livelihood opportunities for the locals.

iii.

Encourage and promote Private Sector Participation in the development of tourism sector.

The tourism related infrastructure would be a combination of recreational and support facilities such as:

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report ii. Encourage entrepreneurship and

Figure 1: Tourism related Infrastructure

  • 1.3 Approach and Methodology

The Approach to the entire assignment is depicted in the flow chart below.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report ii. Encourage entrepreneurship and
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR
MALAPRABHA DAM, BELAGAVI
Project Feasibility Report

Figure 2: Approach to the project

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report Figure 2: Approach to
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 2. Regional Profile The
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR
MALAPRABHA DAM, BELAGAVI
Project Feasibility Report
2.
Regional Profile
The
project
site
is
located
beneath
the
Malaprabha dam in Naviluteertha in Savadatti
taluk of Belagavi district. It is located 85 kms
from Belagavi city and 50 kms from Dharwad.
Since Belagavi is located between Maharashtra
and Goa, the place has acquired a unique
culture and heritage of its own. The area of the
district is 13,415 sq. km., which has been
DHARWAD
divided into ten
blocks, and the
population is
4,778,439.
Dharwad
district
is
situated
in
the
western
sector of the northern half of Karnataka. The
area of the district is 4,263 sq. km., which has
been
divided
into
five
blocks,
and
the
Figure 3: Belagavi and Dharwad districts in Karnataka
population
is
1,846,993.
For
centuries,

Dharwad acted as a gateway between the Malenadu region and the plains.

  • 2.1 Location and Regional Settings

Belagavi is bounded on the west and north by Maharashtra state, on the northeast by Bijapur district, on the east by Bagalkote district, on the southeast by Gadaga district, on the south by Dharawad district and Uttar Kannada district, and on the southwest by the state of Goa.

Dharwad is bound on the North by the district of Belgaum, on the East by the district of Gadag, on the South by Haveri and on the West by Uttar Kannada district.

The table below highlights the distance of Belagavi from other Tier-I cities in Southern India:

Table 1: Distance between Belagavi and key Tier-I cities in Southern India

Belagavi

City

Distance (km)

Bangalore

540

Mangalore

460

Mysore

564

Panjim (Goa)

121

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 2. Regional Profile The

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

The table below highlights the distance of Dharwad from other Tier-I cities in Southern India:

Table 2: Distance between Dharwad and key Tier-I cities in Southern India

Dharwad

City

Distance (km)

Bangalore

430

Mangalore

380

Mysore

477

Panjim (Goa)

131

Source: Knight Frank India Pvt. Ltd. research

Belagavi district is also known as Malenadu or Rain Country and the vegetation here is

verdant green throughout the year, hence it is also known informally as the “Bread Basket of Karnataka”. The following table represents the climate profile of the region:

Table 3: Physical Features of Belagavi

Climate

Duration

Temperatures

Summer

Late March June

25°C - 40°C

Rainy

June September

25C to 23C

Winter

November February

18C to 26C

Source: Knight Frank India Pvt. Ltd. research

2.1.1

Demographics 1

The project site is located in close proximity to the districts of Belgaum and Dharwad. Both witness an average literacy rate of as high as 76%, marginally higher than the state average of 75% 2 . With a total population of about 6.6 million, they account for approx. 11% of the population of Karnataka. With a population figure of 4.8 million, the district of Belgaum has witnessed a growth of 13.38% in 2011, from the corresponding figures in 2001 and Dharwad recorded an increase in the population figure of 15.13 % in 2011, compared to the figure in 2001. The table below highlights the demographic profile of the region:

Table 4: Demographic profile of Belagavi and Dharwad

     

Literacy Rate

District

 

Population (nos.)

(average)

   

Decadal

 

Decadal

 

2011

Growth Rate

2001

Growth Rate

Belagavi

4,778,439

13.38%

4,214,505

17.61%

80.45%

Dharwad

1,846,993

15.13%

1,604,253

16.68%

80.30%

Karnataka

61,095,297

15.67%

52,850,562

17.51%

75.36

1 Census 2011 report 2 Source: 2011 Census Provisional Figures

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report The table below highlights

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

  • 2.2 Regional Connectivity

The region is well connected through road network to the southern parts of Karnataka viz-a-viz Bangalore, Mysore and Chennai. This is complemented by an equally good connectivity by rail. Further, the region offers good connectivity via road and rail to other important transportation nodes such as Belagavi, Hubli and Bagalkot.

The figure below highlights the existing rail, road and air network for the region:

Existing Road Network
Existing Road Network
Existing Railway Network
Existing Railway Network

Figure 4: Connectivity of Belagavi and Dharwad

Belagavi and Dharwad are well connected with the neighbouring cities and other parts of the country by various means such as:

Air

The airport serving the region is the Belagavi Airport at Sambra, 72 km from the

project site on SH-20 (Karnataka). Also, Hubli Airport is located at a distance of 67 km from the project site. The closest International Airport is the Goa International Airport at a distance of about 212 km.

Rail

Belagavi is on the main Indian Railways grid being part the of South-Western Division and is well connected by rail to major destinations such as Bangalore, Mysore, Mangalore, Pune, Mumbai, Bhaghya Nagar, Goa, New Delhi and Chennai. The district has 23 railway stations on a railway line of approx. 226 km

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 2.2 Regional Connectivity The

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

passing through the district. Dharwad has 21 railway stations along the 151 km long railway line passing through the district.

Road

Belagavi is connected by road via NH-4 (connecting Maharashtra, Karnataka, Andhra Pradesh and Tamil Nadu) and 4A (connecting Karnataka and Goa). North Western Karnataka Road Transport Corporation (NWKRTC) and Karnataka State Road Transport Corporation (KSRTC) run buses to all the corners of Karnataka and neighbouring states. Dharwad is connected by road via NH-4.

  • 2.3 Economy

Agriculture forms the backbone of these districts with as many as 60-70% of the total working population engaged in the agricultural sector. However, the region has also witnessed the presence of few small to mid-scale industrial units. These include industries from sectors such as engineering & castings, agro-based, etc. However, as mentioned above, agriculture remains the main source of income and employment. Belgaum acts as a trade centre for food grains, sugarcane, cotton, tobacco, oilseeds and milk products. Sericulture is gaining prominence in the district with approximately 480 hectares under Mulberry cultivation. Agriculture is the main resource of the district and Agro and Food Processing Sectors are prominent for investment.

Rich deposits of Bauxite in Belgaum have led to the creation of Aluminium industries, such as the Hindalco Aluminium Factory. The district is an important centre for manufacturing of heavy machine tools and has over 200 foundries producing more than 70,000 tons of automotive and industrial castings of ferrous base. The geographical advantage (as Bangalore, Mumbai and Pune are easily accessible) has led to a major support of Automobile and Aerospace Industries.

Agriculture is the mainstay of the economy of Dharwad. The district is famous for the Dharwad Cotton Hybrid (DCH) variety of cotton. Apart from this, sugarcane, wheat, variety of pulses and fruits like Alphonso mangoes and Guavas are also cultivated. Dharwad is fast growing in industrial prominence with the setting up of a 30,000 unit manufacturing facility for buses in 2009 which is a joint venture between Tata Motors and Marcopolo of Brazil. Hero group is also contemplating making a large investment in the region.

  • 2.4 Education

Belagavi

is

an

important

educational hub, consisting

of eight engineering

colleges,

five

medical

colleges, and some dental

colleges across the district.

The establishment

of

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report passing through the district.Visvesvaraya Technological University in 1998, the largest university in Karnataka Infrastructure Development Corporation (Karnataka) Limited Page 12 " id="pdf-obj-11-61" src="pdf-obj-11-61.jpg">

the Visvesvaraya Technological University in 1998, the largest university in Karnataka

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report passing through the district.Visvesvaraya Technological University in 1998, the largest university in Karnataka Infrastructure Development Corporation (Karnataka) Limited Page 12 " id="pdf-obj-11-67" src="pdf-obj-11-67.jpg">

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

for technical education (B.E., M.Tech, MCA, MBA) with affiliation of more than 208 engineering colleges, raised the importance of Belagavi as a centre of education in Karnataka. Basic degree colleges, nine polytechnic colleges and three law colleges are among the other educational institutions. KLE, the Karnataka Lingayat Education Society, and KLS, Karnataka Law Society, are two educational giants based in Belagavi.

From the late 1970s onwards, Belagavi began seeing a substantial increase in the number of professional education institutions. While initially this was largely in the medical and engineering fields, Belagavi today hosts institutions serving a number of other professional streams as well. The impact of this growth has considerably changed the cultural, linguistic and industrial profile of the city due to the influx of students from across India.

2.5

Tourism

Belagavi is 502 km from Bangalore and 154 km from Panaji. Nestled in the foothills of the Western Ghats, it enjoys a cool, salubrious climate and is surrounded by natural beauty in the form of rivers, hills and dense evergreen forests.

A wide variety of historical sites, temples and churches exist in and around the city, most notably the Kamala Basti fort, Kapileshwara temple (South Kashi), the hills of Vaijnath, Ramtirth waterfalls, Sri Revanna Siddeshwara Temple at Hunshevari in the valleys of Kakati, Siddeshwara Temple in Kanbargi and others.

Belagavi is a famous tourism magnet owing to the following attractions:

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report for technical education (B.E.,
  • i. Belagavi Fort: It is an Ancient Architectural monument where mosques and temples co- exist in perfect harmony, though not much of the orginal structure remains. The fort was built in the 12 th century A.D by the local Ratta rulers. It was renovated and built on by successive rulers who ruled Belagavi from time-to-time. At the very entrance, you will find two Shrines; One dedicated to Lord Ganpati and the other to Lordess Durga. Safa masjid is one of the two mosques inside the fort and by far is the best of the 25-30 mosques in the city. The minars, domes and Arches point to a typical fusion of Indo-Sarcenic and Deccan styles of the Architecture. Two of the circular pillars in the Jamia hall are said to be from the old temples. Some of them have Kannada Inscriptions in Nagari Script, while others have Persian script forming exquisite calligraphic decorations.

ii. Gokak Falls: Located at a distance of 60 Kms from Belagavi in Gokak Taluka, Gokak Falls is a celebrated tourist centre in the district. These falls have a height of about 170 feet. The river Ghataprapha after winding a course of

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report for technical education (B.E.,
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report for technical education (B.E.,

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

a long route takes a leap of 52 meters, over a rocky bed 170 feet down. The falls are famous for its spread and shape. The falls are horse-shoe shaped at the crest, with a flood breadth of 177 metres. The period from June to September is the best season to visit Gokak as it bees in full bloom. Electricity was generated here for the first time in the country in 1887. This generating station can be reached on the rope way.

iii. Yellamma

Temple:

This

beautiful and ancient temple of Goddesss Renuka, is located in Saundatti Taluka at

a distance of 70 Kms from

Belagavi

and

the

place can

be reached from all the other

places by road. It is situated atop the Siddhachal Parvat.

The

temple

is

built

in

the

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report a long route takes

Chalukyan and Rashtrakuta Style and the Carvings reflect the Jain architecture. The temple was constructed by Bomappa Naik of Raybag in the year 1514. There are

temples of Lord Ganesh, Mallikarjun, Parshuram, Eknath, Siddeshwar etc in the temple premises. Devotees from Maharastra, Goa and Andhra Pradesh also come here, apart from people from Karnataka, especially during the time of Jatras which are held twice in a year.

iv. Godachinmalki Falls:

Located

at

a

distance of 50 Kms from Belagavi in Gokak Taluka, it is at a fine spot to the west of the Gokak-Konnur road

in a deep green valley. Also known as Markandeya falls, it is located in

a

rugged

valley,

which

is

approachable

 

from

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report a long route takes

Godachinamalaki village by walking as well as by vehicle through an irregular forest route. It can also be reached from Nirvaneshwara Matha near Yogikolla, only by foot. There are actually two falls formed here. The Markandeya river takes a

first fall from a height of about 25 metres and flows into a rocky valley. After a

short distance

from the

valley,

it

takes the

second fall from a height of about 18 metres.

  • v. Kamala Basti:

Kamala Basti is an ancient Jain

temple dating as

far back

as

1000

AD

and

situated

in

the

famous

Belagavi

fort

in

Karnataka. It was built in the style of the late Chalukyans and this has an idol of Neminatha in black stone. The main highlight of this place is

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report a long route takes
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report a long route takes

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

the „Mukhamantapa‟ which is in the form of an inverted lotus with 72 unfolded petals.

vi. Navilutirtha: Located 10 Kms from Saundatti, a low valley situated in between the 2 hills, in an enchanting place is Navilutirtha. Formerly, it was full of peacocks, frequently flocking round the pond, and thus the place was named Navilutirtha. The Malaprabha Dam near Renukasagar is situated here. It is also a good picnic spot

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report the „Mukhamantapa‟ which is

vii. Rakaskop: Located 16 Kms from Belagavi,

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report the „Mukhamantapa‟ which is

Rakaskop literally

means a

hamlet

 

of

a

Rakkasa (Giant), who

is stated

to

have

lived on

a hillrock

near the village.

 

A

cavern in laterite on the hillrock resembling a huge seated human figure is shown by the people to remind his past existance. Rakaskop is a small picnic spot, reachable by road. Bike ride to Rakaskop is an enjoyable outing, passing through green surroundings and small villages on the way.

viii. Kapileshwara Temple: Located within the city, it is said to be one of the oldest temples in Belagavi. It is called as Dakshina Kashi and it

is

believed

that

the

journey of the 12

Jyotirlingas of India is said to be incomplete without a visit to kapileshwara. One should visit this temple during the month of Shravan or on the day of Mahashivratri to enjoy the beauty and feel the religious essence to the

fullest extent.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report the „Mukhamantapa‟ which is
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report the „Mukhamantapa‟ which is

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

  • 3. Site Analysis

3.1 Introduction

The project site is located near Malaprabha dam in Naviluteertha on a land area of about 5 acres in Savadatti taluk of Belagavi district. It is located along SH-103 about 50 km from Dharwad and 85 km from Belgavi city.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 3. Site Analysis 3.1

Figure 5: Malaprabha Dam in Belagavi

. The following figures show the immediate vicinity of the project site:

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 3. Site Analysis 3.1
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 3. Site Analysis 3.1

Figure 6: Renukasagar reservoir

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 3. Site Analysis 3.1
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 3.2 Location The project
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR
MALAPRABHA DAM, BELAGAVI
Project Feasibility Report
3.2 Location
The
project
site
is
Malaprabha Dam in
located near
Naviluteertha in
Savadatti taluk of Belagavi district along
SH-103 about 50 km from Dharwad and
85 km from Belagavi city.
Renuka sagara is a reservoir for the
Malaprabha river adjacent to Saundatti,
formed by the Malaprabha Dam near
Naviluteertha. The famous Renuka
(Yellamma) temple Yallammagudda
Saundatti and the temple of Goddess
Yellamma or Sri Renukadevi are located
in close proximity to the project site.

Figure 7: Location of project site

The following figure shows the project site and the key cities in close proximity to it:
The following figure shows the project site and the key cities in close proximity to it:
Belgaum
85 km
Project
Site
Dharwad
50 km
Hubli
67 km

Figure 8: Project site and key neighbouring cities

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 3.2 Location The project
 

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

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3.3

Site features and Surroundings

 

The project site is located off SH-103, which is proximate to the project site to the eastern side. In-terms of topography, the project site is marginally undulating. At present, the project site is accessible via a private KNNL road emanating from SH-103 from the eastern side.

The project site comprises an existing and functioning horticultural space called Shankar Garden, which lies along the internal campus access to the Naviluteertha Dam. Further, the project site also includes a defunct Inspection Bungalow (IB) called Jaladarshini, which overlooks the Malaprabha reservoir and lies to the northwest of the dam structure.

The following table summarises the features of the Project Site:

 

Table 5: Features of the Project Site

 

Area

5 acres

Access

Accessible via a private KNNL road emanating from SH-103

Shape

Irregular in shape

Topography

Marginally undulating

Visibility

Very good visibility from the approach road

Contiguity

Non-contiguous land parcel

 

The following table highlights the boundary and immediate surroundings of the Project Site:

Table 6: Boundary and Surroundings of the Project Site

 

North

Vacant Land

East

SH 103 and a private KNNL Road leading to project site

West

Naviluteertha Dam

South

Upstream catchment of Malaprabha river

 

The following table summarises the status of infrastructure at the project site:

Table 7: Infrastructure status at the Project Site

 

Power

Exists within the development

Telecommunication

Exists within the development

Water Supply & Sewage

Exists within the development

3.4

Connectivity

The site enjoys excellent road connectivity to Bangalore, Mysore and Chennai (via Bangalore). The following table highlights the proximity of the subject site from the key public transport nodes:

Table 8: Distance of project site form key public transport nodes

Mode of Public Transport Node Distance*(km) Rail Dharwad Naviluteertha Bus Stop Belagavi 50 Road (Bus) 0.14
Mode of Public Transport
Node
Distance*(km)
Rail
Dharwad
Naviluteertha Bus Stop
Belagavi
50
Road (Bus)
0.14
Air
72

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

 

Air

Hubli

67

* Note: The table highlights the distances from the key public transport nodes in close proximity to the subject site.

3.5

Accessibility to key locations

The following table highlights the distance between project site and the surrounding important destinations:

Table 9: Distance of Project Site from Important destinations

 
 

Key locations

Distance from Project Site (km)

Savadatti

11

Dharwad

50

Hubli

67

Belagavi

85

Belagavi Airport

72

Belagavi Railway Station

83

Bagalkot

96

 

Regarding accessibility through public transport, Malaprabha Dam is moderately connected though public transport as it is located along SH-103. There are regular State owned buses operating across the region and the surrounding districts. The North Western Karnataka Road Transport Corporation (NWKRTC) covers North West regions like Belgaum, Dharwad, North Canara, Bagalkot, Gadag & Haveri districts. From Bangalore, NWKRTC operates about 8 buses at an average interval of about 3 hours. Similarly buses run from Belagavi at an average 30 minutes interval.

3.6

Development Control Regulations

The Project Site lies outside the jurisdiction of Belagavi Urban Development area. However, it comes under The Karnataka Town and Country Planning Act, 1961 and therefore the Development Controls Regulations stipulated under the same are applicable for the subject development. Floor Area Ratio (FAR) of 1.5 will be assumed for any development within the Project Site Development.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report Air Hubli 67 *

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

  • 3.7 SWOT Analysis

The SWOT analysis of the Project Site is as follows:

Table 10: SWOT Analysis of project site

 

Helpful-To achieving the objective

Harmful- To achieving the objective

 

Internal origin Attributes to the site

Strengths

 

Weaknesses

 
  • Dam Catchment and

the terrain are

  • Moderate

to

Poor

regional

connectivity

ideally suited for various water based

(Inadequacy of transport facilities).

tourism activities.

  • Negligible quantum of quality real estate space, viz. commercial, retail and hospitality, which is an inhibiting factor for the slow economic growth.

  • Remote location of the subject site might hinder logistics required for support activities of hotels and F&B services.

  • Non - Contiguous parcel of land

 
 

Opportunities

 

Threats

  • Latent potential for tourism related branding - nature tourism and leisure

  • Marketing the proposed development will be

External origin Attributes to the

activities due to lack of facilities and

activities.

challenging task because of undeveloped real estate market

  • Proximity to religious shrines may generate demand for transit amenities and tourist amenities

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 3.7 SWOT Analysis The

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  • 4. Perception Analysis and Consultations

    • 4.1 Introduction

This chapter summarises the results of the primary survey of stakeholders Tourists, Tour operators and Travel agents, Tourism departments, other concerned government departments and experts.

The basic purpose of the primary field survey was to obtain a first-hand assessment of the ground realities at various tourist destinations. The major tourist destinations in Karnataka were identified and plotted on a map. The major areas with a cluster of tourist destinations were segregated on the map and all these major clusters were covered during the field survey.

The primary field survey envisaged interactions with major stakeholders at major tourist destinations in the state. The travel and tourism industry has a number of stakeholders:

Tourists

Government departments like KNNL officials and Department of Tourism etc.

Hotel and Restaurant industry

Students

Real Estate Developers/ Agents

  • 4.2 Perception Survey Findings

    • 4.2.1 Perception Analysis and Consultations Perception surveys were carried out through a personal interview with some of the key stakeholder such as hotel chains, developers, tour operators, tourists and government officials for identifying the key issues related to tourism and tourism infrastructure facilities which are presently lacking in the Belgaum region. The surveys and consultations were also intended to ascertain the perception of the above stakeholders on the tourism potential of the region & requisite improvement/ augmentation facilities in general, and willingness of the above key stakeholders to participate / take part in the project development as developer / promoter or user. Generally, all stakeholders highlighted the key issues and need to promote tourism activities in the above said region. The unanimous opinion was the need for a strategy to address inadequacy in terms of quality accommodation facilities for both domestic and foreign tourists. In many cases, stakeholders highlighted the deficiency quality dining restaurants and recreational facilities across the northern region of Karnataka as a prime issue followed by basic urban infrastructure facilities.

    • 4.2.2 Origin of Tourists

1.

The maximum domestic tourist inflow into the State is from Maharashtra and the southern states of Tamil Nadu and Kerala. Together, they account for 48 percent of

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 4. Perception Analysis and

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

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total tourist turnover. A substantial number of tourists from the eastern part of India have also visited the region.

Sikkim, 3% Bihar, 7% Punjab, Rajasthan , 7% Maharashtra, 3% 22% Orissa , 7% Tamil Nadu,
Sikkim, 3%
Bihar, 7%
Punjab,
Rajasthan ,
7%
Maharashtra,
3%
22%
Orissa , 7%
Tamil Nadu,
16%
Kerala, 10%
Delhi, 8%
West
Bengal,
7%
Uttar
Gujarat, 3%
Pradesh,
  • 4.2.3 Purpose of Visit

Figure 9: Geographical distribution of Tourists

The chart below captures the major themes attracting the surveyed tourists. Usually, combinations of themes complete the itinerary of tourists. Culture and heritage was the dominant theme among the tourists due to the presence of Saundatti Yellamma Temple in Belgaum. The other popular theme was leisure.

Business

Conference Leisure, , 6% 14% Heritage/ Cultural, 80%
Conference
Leisure,
, 6%
14%
Heritage/
Cultural,
80%

Figure 10: Purpose of Visit by the tourists

  • 4.2.4 Tour Package Majority of the tourists, i.e. 90 percent were found travelling without a package tour program and 10 percent of them were found to be travelling with a tour package program. It was observed that even the tourists who were travelling on package tour,

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report total tourist turnover. A

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

would be travelling only a part of their tour in a package tour. This is mainly because of poor connectivity and lack of information about tourist potential area.

  • 4.2.5 Mode of Transport It is to be noted that a lot of tourists use a combination of transport modes to reach the destination from their respective port of entry. In the case of domestic tourist majority of the responded said that their main mode of transport was road & rail but in the case of foreign tourist air, rail and road were said to me their main mode of transport. On an average the combination of rail & road were found to be maximum. During survey, some of the foreigners also expressed their willingness to avail short distance air travel to reach their places of interest in the region. It was also highlighted by the responded (foreign and domestic tourist) that transportation through private mode (Car/Taxis) were bound to be very expensive as the potential are well scattered within the region. Appropriate packaging by the hotelier supported by the concerned government departments will make the tour viable and less expensive.

Air , 1% Others, 14% Rail , 50% Road , 35%
Air , 1%
Others,
14%
Rail ,
50%
Road ,
35%

Figure 11: Mode of Travel

  • 4.2.6 Average Length of Stay Regarding the average length of stay, majority (49%) of the tourists preferred to stay only for two days followed by one day (28%). This variation in stay is mainly because the people who were visiting from the neighboring states of Karnataka tend to spend less time than the people who are coming from the distant places. Majority of the tourists were not much focused as far as covering the destinations was concerned. It was also highlighted by the responded (foreign and domestic tourist) that a quality destination with proper graded accommodation with full-fledged amenities and facilities and F&B components will retain the tourist population for more numbers of days in the region.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report would be travelling only

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

More 3 days, than 3, 17% 6% 1 day, 28% 2 days, 49%
More
3 days,
than 3,
17%
6%
1 day,
28%
2 days,
49%

Figure 12: Average Length of Stay

  • 4.2.7 Frequency of Visit The majority (81%) of the tourists was found to be visiting the destination for the first time and the remaining 19 percent of them were repeat visitors. Majority of these repeat visitors consisted of pilgrim tourists from the neighboring South Indian States, Maharashtra, and Gujarat. Almost all the tourists surveyed expressed their willingness and interest to visit the destination in future as well.

Repeat Visit, 11% First Visit, 89% Figure 13: Frequency of visit of tourists
Repeat
Visit, 11%
First Visit,
89%
Figure 13: Frequency of visit of tourists
  • 4.2.8 Problems faced by the tourists during Stay

    • Transportation: The local transport or the conveyance was a problem for the tourists mainly in the small towns, villages or places located a bit away from the main town or district headquarters. They were not only costly but also inconvenient at times.

    • Inadequate tourist information about the destinations and places of interests.

    • Difficulty in getting hotels providing budget and premium accommodation.

Issues Highlighted by Government Officials (KNNL & Tourism Department)

  • Safety and Security of the monument and the other surrounding areas are lacking.

  • Difficulty in getting quality graded hotels in the region with full-fledged amenities and facilities.

  • The region itself is not been promoted or publicized through media, newspapers.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report More 3 days, than

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

  • Inadequate tourist information about the destinations and places of interests.

  • Frequency of the transport needs and the quality of the transport (existing) mode to be improved.

  • Need for charted trip or in the form of packaging with NWKRTC.

Issues Highlighted by Students

  • The entire region is lacking entertainment facilities (Amusement Park, Adventure activities etc.)

  • Frequencies of transportation mode are significantly less.

  • There are no information centers in the region which can exhibit or translate the tourism development.

  • Belagavi lacks quality accommodation.

  • High transport cost through private mode.

  • Need for information kiosk within the KNNL development, highlighting the evolution of the Dam.

  • 4.2.9 Suggestions on Improving the Tourist Destination

    • Setting up of more number of information outlets at destinations and entry points (Railway Station, Bus Stand etc.).

    • Transportation and accessibility to all the tourist potential area and places of interest.

    • Frequency of the transport needs to be improved. More government buses and private are required in the form charted trip or in the form of packaging.

    • Improvement of basic civic facilities near the potential tourist areas.

    • Better and cheaper accommodation and local conveyance such as pre-paid auto and taxis at the destinations for mostly frequented by the tourists.

    • Security measures at tourist destinations.

    • More publicity through media about the destinations.

    • Improvement of the hotel services and the need to become more tourists friendly.

    • Better informed guides and travel / tour operators.

    • More standard and quality hotels near to the potential areas.

    • Recreation in terms of Theme Park, Light Show and Dam Trip at the destination with proper information kiosk.

Inference: Many locals, student visitors, government officials and domestic tourists stressed on the need for restaurants, affordable hotels with more options entertainment activities. There was also stress on the good transport facilities. Foreign tourists were

very few and the perception they had was the need for good and quicker connectivity,

signage‟s, availability of ATMs, emergency healthcare, security along with good hotels

and restaurants.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report  Inadequate tourist information

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

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  • 5. Identification of Project Facilities Keeping in mind the project site‟s characteristics, location, and existing/potential catchment available in the region, the following product mix has been proposed. The feasibility of each type of development shall be discussed later in the report.

    • 5.1 Competition Analysis A detailed competition analysis has been undertaken to assess the status of the Hospitality sector. The region within a radius of 50 km from project site, which includes Belagavi and Hubli- Dharwad, has been considered for the purpose of analysis.

Project Site Belgaum 85 km Dharwad 50 km Hubli 67 km
Project
Site
Belgaum
85 km
Dharwad
50 km
Hubli
67 km

Figure 14: Catchment area of the project site

  • 5.1.1 Hospitality Segment The hospitality market in Belagavi has been restricted primarily to Belagavi city (approx. 85 km from the project site) and is dominated by business travellers to the various foundry units in the Industrial estates. In addition to the business tourist, Belagavi is a town with rich cultural heritage with tourist places in and around the region. The city of Goa which is one of the hot tourist destinations is only 120 km from Belagavi and is approachable both by rail and road in 3-4 hours. Most of the hotels are located along the College Road, Club Road, Kirloskar Road and along the main road leading to the Central Bus stand. In terms of hotel categories, the city is yet to have a formal 3-4 star category hotel. Eefa Hotel on Club road is close to a 3 star rating hotel having 59 rooms inventory with 80% being standard rooms, 10% Deluxe and 10% suites.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 5. Identification of Project

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The other premium hotels are Sanman, Aadarsha, Sankam Residency and Krishna Inn having a 50-80 room inventory and tariff in the range of INR 3000-5000. The other budget hotels in the same locality generate tariffs in the range of INR 600-1500 per day. The basic room rents for the different hotels in Belagavi are provided in the table below:

Table 11: Hospitality sector overview in Belagavi

Hotel Name

Base Tariff (INR)

Hotel Eefa

3000-5000

Sanman Hotel

1100-3500

Adarsha Palace Hotel

1000-2500

Sankam Residency

2000-3500

Kshema Inn

900 3500

Sai Sangam International Hotel

700-2000

Rakshit International Hotel

700-1500

Ramdev International Hotel

600-1400

Pai Hotel

600-1400

The hospitality segment in the Hubli Dharwad region is led by the presence of number star category hotels offering premium accommodation. The quantum of hotel properties falls while moving from Hubli Dharwad to the project site. The lack of budget and no-frills category accommodations, despite being frequented by tourists making way to religious tourism locations in and around the region, makes the segment very attractive from the perspective of development budget segment hotel. The figure below highlights the existing scenario in the influence region:

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report The other premium hotels
DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report The other premium hotels

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

The other demand drivers for developing the hospitality segment are:

Table 12: Demand Drivers for Hospitality Segment

Factor

 

Description

Lack of

Nearest accommodation from the project site located at a distance of over 50 km

supply

Under-developed market for budget hospitality segment in the project site region

Ideal Location

Project site located away from the district of Dharwad and adjacent to the Malaprabha reservoir, and hence is ideally suited for the development of a budget hotel

Lack of

No significant existing/upcoming competition up to a distance of 15 km from

Competition

project site

 

Subject property is located in close proximity to Dharwad and is less than 15

Potential

km from the Saundatti Yellamma (Renuka) temple and en-route to other

Catchment

spiritual and heritage sites in Badami, etc. which is frequented by tourists throughout the year and would be a potential catchment.

According to the Department of Tourism (GoK), the state witnessed a total tourist inflow of about 85 million international and domestic tourists in 2011. The districts of Belgaum and Dharwad, being considered as potential catchment regions for the proposed development mix, account for about 4% of the total inflow of tourists.

The following table(s) presents a snapshot of the above mentioned tourist statistics 3 .

Table 13: Tourist Inflow statistics 2011

Destination

Domestic Tourists

 

International Tourists

Total Tourists

Belagavi

2,759,800

 

-

 

2,759,800

Dharwad

324,707

 

1,941

 

326,648

Karnataka

84,107,390

 

574,005

 

84,681,395

Source: Tourism statistics of Department of Tourism, GoK

 

Table 14: Tourist Inflow growth figures for the period of 2007-11

 

Category

 

2007

2008

2009

2010

2011

Domestic

 

37,825,953

37,010,928

32,729,679

38,202,077

84,107,390

Growth Rate

 

5%

(-2%)

(-12%)

17%

120%

CAGR

17% over the period of 2007-11

 

International

 

534,563

520,041

229,847

324,573

574,005

Growth Rate

 

6%

(-3%)

(-56%)

41%

77%

CAGR

1.5% over the period of 2007-11

 

Total

 

38,360,516

37,530,969

32,959,526

38,526,650

84,681,395

Growth Rate

 

5%

(-2%)

(-12%)

17%

120%

CAGR

17% over the period of 2007-11

 

As represented above, the tourist inflow in Karnataka has grown at a compound annual growth rate of 17% for the period of 2007-11. Further the potential catchment

3 Statistics presented for the year 2011

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report The other demand drivers

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region of Belagavi and Dharwad together account for about only 4% of the total tourist inflow in the state, for the calendar year 2011. This highlights the fact that these destinations possess latent tourist demand. Belgaum accounting for about 3% and Dharwad about 1% of the total traffic in Karnataka in 2011, the region has witnessed a lack of supply in terms budget accommodation. Based on the above analysis, the following facility has been proposed:

Table 15: Proposed facility in Hospitality segment

Type

Product

Potential Catchment

Key Drivers of Demand

 

Small to medium-sized hotel establishments that offer a very limited amount of on-site amenities and often only

 

An attractive offering to tourists from various

Budget Segment

Hotel +

offer basic accommodations with little to no services, these

Belgaum and Dharwad

Renovated

Jaladarshini IB

facilities normally only cater and market to a specific demographic of travellers, such as the budget-minded travellers seeking a "no frills" accommodation

Districts, Bangalore, Mysore

parts of the India, in addition to attracting

tourists

from

Bangalore, Chennai, and Mangalore.

  • 5.2 Proposed Facilities Keeping in mind the project site‟s characteristics, location and existing/potential catchment available in the region, the following product mix has been proposed:

Table 16: Proposed Project Facilities

Type

Product

Potential Catchment

Key Drivers of Demand

 

Capital Investment Medium

 

Adventure /

A getaway for families and

Belgaum and

Lack of outbound and

Water Sports

students offering a host of

Dharwad Districts,

adventure entertainment

& Outbound

games, or team-building

Bangalore, Mysore

facilities in Belgaum and in

Training

activities and outbound

Dharwad being the driver.

Arena

training

Budget

Small to medium-sized hotel establishments that offer a very limited amount of on-site amenities and often only offer basic accommodations with

   

Segment Hotel

little to no services, these

Belgaum, Dharwad ,

An attractive offering to tourists looking for no frills

+ Renovated

facilities normally only cater

Bangalore, Mysore

accommodation

Jaladarshini IB

and market to a specific demographic of travellers, such as the budget-minded travellers seeking a "no frills" accommodation.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report region of Belagavi and

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

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Type

Product

Potential Catchment

Key Drivers of Demand

 

Capital Investment Low

 

Public Park

Development of landscaped gardens with designated

Savadatti, Dharwad,

Lack of public parks in the catchment. Kote Kere Lake and Amusement Park and

children‟s play area.

Hubli, Belgaum

Unkal lake in Dharwad being the only case in point.

Educational

Tie-up with engineering colleges and universities for

Bangalore, Mysore,

Engineering colleges and universities from tier I

Tie-ups

providing Internship programs/educational tours to the project site

Savadatti, Dharwad, Hubli, Belgaum

cities could include the educational excursion as a part of the curriculum

  • 4.3 Demand Assessment As a result of above mentioned parameter and post conducting an extensive market study in the region, an in-depth demand assessment has been conducted for the each of the developments proposed above. While computing the demand assessment, the following parameters have been considered:

Total Population in the catchment region

Total Tourist inflow in the catchment region

Footfalls and Revenue figures of similar properties in Karnataka

Per capita income figures for the fiscal 2013-14

Entertainment spending as a percentage of per capita income for fiscal 2013-14

Further, as each of the developments proposed cater to different sections of the population, the potential catchment region includes Belagavi and Dharwad Districts.

The table below presents estimated footfall projections over the period 2015-25:

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report Type Product Potential Catchment

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Table 17: Footfall Projections for Proposed Facilities

FOOTFALLS PROJECTION*

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

Capital Investment Medium

Adventure / Water Sports & Outbound Arena

 
  • - 45,456

43,291

 

47,728

50,115

52,620

55,252

58,014

60,915

63,961

67,159

Budget Segment Hotel + renovated Jaladarshini IB

 
  • - 36,784

35,032

 

38,623

40,554

42,582

44,711

46,946

49,294

51,758

54,346

Capital Investment Low

Public Park

1,13,402

1,19,072

1,25,026

1,31,277

1,37,841

1,44,733

1,51,970

1,59,568

1,67,546

1,75,924

1,84,720

Educational Tie-ups

1,560

1,638

1,720

1,806

1,896

1,991

2,091

2,195

2,305

2,420

2,541

*All figures in Nos.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report Table 17: Footfall Projections

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The above table highlights the expected footfalls for each of the proposed developments. The expected time of construction and operation commencement for Medium capital investment development have been assumed to be Q1 2016. Hence the same do not reflect any footfalls in the initial period from 2015-17.

Based on the above mentioned demand projections, the following land use mix has been proposed:

Table 18: Land-Use Mix for Proposed Facilities

Land-Use Mix

Capital Investment Medium

Budget Hotel + renovated Jaladarshini IB

  • 1 acre

Adventure / Water Sports & Outbound Arena

  • 3 acres

Capital Investment Low

Public Park

  • 1 acre

Educational Tie-ups

-

Total

  • 5 acres

Hence given the current market scenario, demand-supply gap and potential catchment region, the proposed developments can be developed with about 84% land utilization.

The following table briefs the potential clients/prospective users of the proposed project facilities:

Table 19: Potential Clients/ Prospective Users for Proposed Facilities

Development

 

Potential Client/Prospective Users

Capital Investment Medium

 

Budget Hotel + renovated

Subject location is in proximity to Dharwad and is less than 15 km from the Saundatti Yellamma (Renuka) temple and en-route to other

Jaladarshini IB

spiritual and heritage sites in Badami, Aihole, Pattadakal, etc. which

Adventure / Water Sports & Outbound Arena

is frequented by tourists throughout the year and would be potential demand generators.

Capital Investment Low

Public Park

NA

Educational Tie-ups

NA

  • 4.4 Fee Structure Based on the above mentioned expected demand assessment projections and also taking into consideration the potential land-use mix the optimal fee structure for the said developments has been computed. In addition, while computing the fee structure, the fee structures of similar developments in South India have also been taken into account. The following table highlights the optimal fee structure along with the year-on-year escalation factor.

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report The above table highlights

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

Table 20: Fee Structure for Proposed Facilities

Fee Structure

Average Fee*(Rs.)

Escalation/ 3 years (%)

Capital Investment Medium

Budget Hotel + renovated Jaladarshini IB

1000 - 1500

8

Adventure / Water Sports & Outbound Arena

100 - 150

8

Capital Investment Low

Public Park (Per person)

10 - 15

8

Educational Tie-ups** (per person)

150 200

8

*Average Fee is expected to vary according to age categories **Fee to be charge per person for visit to the dam only. The same doesn’t include cost for travel, accommodation and food. To be charged additionally on a case to case basis

The above mentioned fee is exclusive of VAT, service tax and other charges. The same would be charged additionally as per the applicable norms.

  • 4.5 Viability Assessment The following table highlights the expected pricing for the proposed developments for a period of 5 years. The escalation factors for the same have been assumed, as mentioned earlier.

Table 21: Viability Assessment of Proposed Facilities

Development

2017

2018

2019

2020

2021

Capital Investment Medium

         

Budget Hotel + renovated Jaladarshini IB

-

-

1500

1650

1650

Adventure / Water Sports & Outbound Arena

-

100

100

108

108

Capital Investment Low

         

Public Park (per person)

-

10

10

11

11

Educational Tie-ups (per person)

150

150

150

170

170

All figures in Rs. *Rentals mentioned for a warm-shell space which shall be leased out to F&B chains at the said rentals. Warm-shell space to be built by the developer **Resort to offer budget category accommodation and to be constructed by the developer

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report Table 20: Fee Structure

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

  • 5. Financial Feasibility Assessment A financial model for the proposed project facilities to be developed under PPP framework was prepared and tested. This section captures the key financial highlights of the project configuration.

    • 5.1 Area Assumptions The various facilities which have been proposed at the site, along with allocated to each facility, are as follows:

the area

Table 22: Area Assumptions

Components

Area (acre)

Public Park

1

Educational Tie- Ups

-

Budget Hotel + renovated Jaladarshini IB

1

Adventure / Water Sports & Outbound Arena

3

Total

5

  • 5.2 Costing Assumptions The key assumptions for the project cost of the various components of the proposed facilities based on the standard Industry norms are set out below:

Table 23: Assumptions for CAPEX

Development

CAPEX (INR

crore)

Public Park

   

1.25

Educational Tie-ups

   

NA

Adventure / Water Sports & Outbound Arena

   

2.50

Budget Hotel + renovated Jaladarshini IB

No. of keys ~ 65

INR 10 L/Key

6.30

  • 5.3 Estimated Project Cost

Based on the project cost assumptions, the total project cost for various components is set out below:

Table 24: Estimated Project Cost

Components

Construction Period

Base Cost

 

Escalated Cost

 

Years

INR Crore

 

INR Crore

Public Park

 

1

1.25

 

1.35

Educational Tie- Ups

 

-

-

 

-

Adventure / Water Sports & Outbound Arena

 

1

2.50

 

2.71

Budget Hotel + renovated Jaladarshini IB

 

2

6.30

 

6.99

Total Construction Cost

 

10.05

 

11.05

Contingency

     

0.22

Master Planning and Pre Ops Charges

     

0.33

Financing Charges

     

0.09

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report 5. Financial Feasibility Assessment

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

 

Interest during construction (IDC)

   

1.14

Total Project cost

   

12.83

5.4

Financial Assumptions

These assumptions are based on the market norms and trends and estimates:

Table 25: Financing Assumptions

 
 

Financing

Units

Debt : Equity ratio

70:30

Interest Rate

13% per annum

Cost of Equity

20% per annum

Corporate Tax

33.99%

Concession Amount

Rs. 10 Lakhs

Concession Period

30 years

5.5

Operating Assumptions

Each component of the proposed project facilities i.e. Public Park, Educational Tie-Ups, Budget Hotel and renovated Jaladarshini IB, Adventure/Water Sports & Outbound Arena form the revenue sources for the project. The operating costs would include the operation and maintenance of all the facilities, utilities (power and fuel) cost, and costs for food and other components including marketing/ promotion and administration.

The key assumptions related to revenue and operational costs are indicated for each component along with the growth rate assumptions for each parameter. The basis for arriving at the said assumptions has also been provided against each assumption:

Table 26: Assumptions for Revenues from facilities

Facility

Revenue

Escalation/3 years (%)

Basis for assumptions

Public Park

Rs. 10

   

Educational Tie- Ups

Rs 150 per person

Adventure / Water Sports & Outbound Arena

Rs 100 per person

Budget Hotel & renovated Jaladarshini IB

Rs. 1500 per room

8

Assumptions based on market norms

Common F&B facility

Rs. 50 per person

Revenue from

 

Advertisement

5% of the total revenues

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report Interest during construction (IDC)

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

Table 27: Assumptions for O & M expenses of each facility

Operating costs

Parameters

Y-o-Y escalations (%)

Basis for assumptions

Public Park

8% of the Capital cost

   

Educational Tie- Ups

Same as Dam‟s OPEX as

the it is not an additional component

Adventure / Water Sports & Outbound Arena

15% of the Capital cost

Budget Hotel &

 

Assumptions as per

renovated

40% of hotel revenues

5

market and industry

Jaladarshini IB

norms

F&B Expenses

40% of F&B revenues

Marketing and

2% of the total revenues

Promotion

Administrative

 

expenses

3% of the total revenues

Periodic

 

Maintenance

5% of the Capital cost

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report Table 27: Assumptions for

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

Table 28: Projections for Revenue and Operating Expenses

All figures in Crores

FY 17

FY 18

FY 19

FY 20

FY 21

FY 22

FY 23

FY24

.....

FY

46

Revenue

Revenue from Public Park

-

0.13

0.14

 
  • 0.16 0.20

  • 0.17 0.21

0.18

     

1.29

Revenue from Educational Tie ups

0.03

0.03

0.03

 
  • 0.03 0.04

  • 0.04 0.05

0.04

     

0.25

Revenue from Adventure / Water Sports & Outbound Arena

-

0.48

0.50

 
  • 0.57 0.71

  • 0.60 0.90

0.63

     

3.84

Revenue from Budget Hotel

-

-

2.49

 
  • 3.01 4.19

3.56

  • 3.29 4.78

     

8.77

Revenue from common F&B facility

0.01

0.01

0.63

 
  • 0.72 1.05

  • 0.81 1.19

0.92

     

18.87

Income from Advertising

0.00

0.03

0.19

 
  • 0.22 0.31

  • 0.25 0.33

0.27

     

1.65

Total

0.04

0.67

3.98

 
  • 4.72 6.50

5.59

  • 5.15 7.01

     

34.67

Operating Expenses

Public Park

-

0.10

0.11

 
  • 0.11 0.13

  • 0.12 0.13

0.12

     

0.39

Educational Tie-ups

-

-

-

-

-

-

-

-

 

-

Adventure / Water Sports & Outbound Arena

-

0.38

0.39

 
  • 0.41 0.48

0.46

  • 0.43 0.50

     

1.47

Budget Hotel

-

-

0.71

 
  • 0.86 1.20

  • 0.94 1.28

1.02

     

2.51

F&B expenses

0.00

0.00

0.84

 
  • 1.00 1.41

1.1

1.21

 

1.54

 

8.80

Marketing and Promotion

0.00

0.01

0.08

 
  • 0.09 0.13

  • 0.10 0.14

0.11

     

0.69

Administrative Expenses

0.00

0.02

0.12

 
  • 0.14 0.19

  • 0.15 0.21

0.17

     

1.04

Periodic Maintenance

-

-

-

-

-

0.25

1.35

-

 

-

Annual Concession Period

0.15

0.16

0.17

0.17

0.18

0.19

0.20

0.21

 

0.62

Total

0.15

0.67

2.42

 
  • 2.80 5.09

  • 3.04 4.02

3.53

     

15.51

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Feasibility Report Table 28: Projections for

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Structure Report

Based on the above mentioned financials the net present values at a 12.01% discounting factor of the revenue streams, expenses and Profit after Tax (PAT) for the project are mentioned below.

Table 29: NPV of Revenues, Expenses and PAT

Revenues (NPV) (Rs. Crores)

Expenses (NPV) (Rs. Crores)

PAT (NPV) (Rs. Crores)

56.53

33.00

11.87

The project returns typically expected by the developers are of the order of 15 % and accordingly, projects are considered to be financially viable in case the Project Internal Rate of Return (Project IRR) is greater than 15%. The project returns are set out in the table below.

Table 30: Project financial indicators

Parameter

Value

Project NPV (Rs Crores)

7.95

Project IRR (%)

17.64

Indicative Concession payment (Rs Lakhs)

15

NPV of Concession Payment (Rs Lakhs)

1.83

It may be noted that the concession payment indicated above could vary depending upon the facilities that the developer would create based on his assessment. The benefits that would accrue to KNNL would be:

Income from the concession payment payable by the successful developer on an annual basis over the concession period.

The project facilities that would be developed would be handed over to KNNL after the concession period or during the termination of the agreement

The property would always be vest with KNNL.

  • 5.6 Sensitivity Analysis The sensitivity analysis has been carried out to determine the range of concession payments such that the project internal rate of return is 15%. The sensitivity analysis has been carried out by varying the following parameters:

Change in capital cost Increase / decrease in Capital Cost

Change in Revenue Stream Varying the entry fee for the Proposed Facilities

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI Project Structure Report Based on the above

DEVELOPMENT OF TOURISM RELATED INFRASTRUCTURE NEAR MALAPRABHA DAM, BELAGAVI

Project Feasibility Report

The following table summarises the sensitivity of the Project IRR to changes in the project cost and revenues:

Table 31: Sensitivity Analysis

     

Change in Project Cost

 
   

-30%

-20%

-10%

0%

10%

20%

30%

 

-30%

17%

15%

14%

12%

11%

10%

9%

Change in revenue

-20%

19%

17%

16%

14%

13%