There is finally some good news for the tourism industry hit by the global recession and the Mumbai terror attacks.

The Ministry of Tourism is working with various state governments to reduce taxes levied on industry players.

The tourism sector which has been badly hit following the wide international coverage of the Mumbai attacks, is now trying to fix the damage done to India's image.

Helping it is the government which is pulling out all stops in its campaign to promote 2009 as the Visit India year.

Leena Nandan, Joint Secretary, Tourism Ministry, said, “Airlines are looking at offering special packages. We will offer something unique and special. We will give special incentive package.”

The government is offering greater subsidies to tour operators with a turnover of up to Rs 20 crore, by giving them financial assistance under the market assistance development scheme.

A 25 per cent subsidy will also be given to those taking space at the India pavilion at major international travel fairs and exhibitions.

The domestic tour operators in MICE segment will also be eligible for MDA assistance now.

Even as they welcome these incentives, some tour operators feel that it may take a while for the fear of security associated with leisure travel to India, to go away.

Zulli Karnik a Tour Operator said, “These financial incentives are welcome because I don’t think that I can participate on my own, as my resources are limited.”

Meanwhile a detailed package for tourism is also being worked out, which will include rationalisation of taxes levied on the industry.

Another proposal being discussed includes a ‘buy one get one free’ scheme where foreign visitors travelling to India next year will be given a free stay at a wellness, adventure or rural resort in 2010 and 2011.

But will airlines offer free tickets and will hotels offer free nights?

The answers to these questions are not clear as the nitty gritties are being worked out.  But the travel industry is eagerly awaiting a package which could be announced soon.