Economic Valuation of Coastal Tourism Services: A Case Study on the Mudflats

Abstract

The tourism sector plays a vital role in generating income and employment opportunities for the local community and bringing the foreign exchange to the country. Increased tourism revenue not only supports the conservation of resources but also supports the development of the economy and contributes to the GDP. Coastal ecosystems such as mangroves, coral reefs, and sand dunes in India attract both domestic and foreign tourists. Although mudflats offer a wide range of tourism and recreational benefits globally, their potential use in the tourism sector is highly neglected in India. Gujarat coastal stretch consists of 83.77% of total mudflat area in India among which only 0.47% mudflat area located in Dumas beach, Surat district provide significant tourism service. This study has estimated the economic value of mudflats tourism in Dumas beach by adopting individual travel cost methods. The consumer surplus estimated from the demand function suggests that mudflats in Dumas beach generated Rs. 83.79 crores in 2019. Per hectare tourism value of mudflats is estimated at Rs. 6.03 lakhs and the average mudflat patch value of tourism is estimated at Rs. 10.47 crores in 2019. The Net Present Value of mudflat tourism for 20 years period was also estimated using 3% and 5% discount rates at Rs.1248.72 crores and Rs.1044.17 crores respectively. The study suggests that raising awareness among the tourists and local community on utilising mudflats as a tourist site is a prerequisite to promote mudflat tourism. Similar mudflat locations could be identified and tourism activity could be promoted across other coastal stretches of Gujarat. Revenue generation through mudflat tourism will serve as a tool to finance the conservation costs of coastal resources.