To be able to cover their losses caused by the coronavirus pandemic, the Haab has sought interest-free working capital of Tk1,500 crore from the government
Hoque International Tours and Travels, a Chittagong-based agency operating Hajj and Umrah services since 1999, finds itself trapped in an unprecedented business collapse this year.
Each year, around 200-400 pilgrims go to perform Hajj through this agency. However, the agency this year has not been able to send its 170 intending hajjis to the Kingdom of Saudi Arabia due to the coronavirus pandemic.
It has been deprived of the business from Hajj services as Saudi Arabia, to contain the spread of Covid-19, has banned international visitors from performing Hajj this year.
The Saudi authorities have also announced they will allow a "limited" number of people to perform Hajj this year. Such people may be of different nationalities but are already residing in the kingdom.
This very decision has hit around 1,238 Hajj agencies in Bangladesh like Hoque International Tours, causing them to lose around Tk5,000 crore in turnover from the hajj business, according to the Hajj Agencies Association of Bangladesh (Haab).
At the same time, the loss from Umrah pilgrimages has amounted to Tk1,175 crore with the Saudi authorities going for a suspension of Umrah on February 26 this year.
"I have lost business worth around Tk5.10 crore this year from Hajj pilgrims. However, they will go next year as they did not cancel their registration," said Mahmodul Hoque Pearu, proprietor of Hoque International.
"Although Umrah can be performed all the year round, most Umrah pilgrims from Bangladesh go to Saudi Arabia during November-April. My agency deals with 500-800 Umrah pilgrims each season, but due to Covid-19 this year, we could send only 150 people till last December," he added.
Mahmodul also mentioned that he had a travel agency business too and had been finding it hard to pay 11 office staff and manage other maintenance costs for the last few months.
Almost 43 percent of Umrah pilgrims visit Saudi Arabia during the Islamic months of Rajab, Shaban and Ramadan, making it the busiest season after Hajj for agencies economically dependent on tourism, reports TRT World.
For the first time in recent history, there were no visitors to the capital city of Saudi Arabia during Ramadan as Riyadh took unprecedented measures to suspend religious tourism over the pandemic.
According to TRT World, Saudi Arabia has recorded over 160,000 cases of infection and 1,300 deaths. It lifted a nationwide lockdown on June 21.
Hajj is a week-long Islamic ritual and a must for financially-capable Muslims at least once in their lifetime.
Approximately, 2.5 million pilgrims from different countries typically visit the holiest sites of Islam in Makkah and Madinah for the Hajj, reports the Saudi Gazette.
The event will begin on July 29 this year, reports Al Jazeera.
Even though the majority of Saudi Arabia's wealth comes from oil, pilgrims visiting Makkah and Madinah are critical to its economy. The kingdom saw more than 19 million pilgrims for Umrah and 2.5 million pilgrims for Hajj in 2019. Together they contributed approximately $12 billion or 7 percent of total GDP and 20 percent of the kingdom's non-oil GDP, reports TRT World.
This year, 137,198 Bangladeshis were set to perform Hajj. The cost for performing Hajj this year under private management was fixed at Tk361,800 on a general package and Tk317,000 under super economy package, according to the Haab.
Besides, the government had three Hajj packages this year, beginning from Tk3.15 lakh to Tk4.25 lakh.
An Umrah package, including a three-star category hotel accommodation, is around Tk1.20 lakh.
"Hajj is one of the fundamental prayers of Muslims. It is considered as one of the largest components of religious tourism over the world," said Moulana Eakub Shorafoti, proprietor of Air Touch Limited and also senior vice-president of the Haab.
"We provide Hajj services not only from the business perspective but also as a prayer. All Haab members are involved in the travel agency business and other sectors of the tourism industry," he added.
Haab has 1,238 members currently while the number of its officers and employees, including the owners of Hajj agencies, is around 20,000.
Besides, around 1 lakh people are involved in the sector indirectly in Bangladesh and Saudi Arabia.
M Shahadat Hossain Taslim, president of the Haab, said, "Around 1 lakh pilgrims were making preparations for Umrah in the last Ramadan. But Covid-19 caused us a loss of about Tk1,000 crore from that business."
"We also took preparations privately to send 1.20 lakh Hajj pilgrims in 2020. We have faced a loss of around Tk5,000 crore as we failed to send people to Hajj," he added.
Besides, the agencies each had to pay monthly salaries and office rents of over Tk50 crore by June 30. The transaction and net loss related to Hajj and Umrah were Tk6,175 crore, added Taslim.
Govt incentives sought
To be able to cover their losses due to the coronavirus pandemic, the Haab has sought interest-free working capital of Tk1,500 crore from the government.
The agencies also demanded the return of their security deposits for two years.
Haab President Taslim said the organisation had requested the government to give it a special incentive as the virus outbreak had affected the sector badly.
Loss of Biman
Around half the number of pilgrims from Bangladesh use Biman Bangladesh Airlines to travel to Saudi Arabia for Hajj. However, this year, Biman has lost the business.
Md Mokabbir Hossain, managing director of Biman, said, "We have lost revenue to the tune of Tk806cr this year against 63,000 pilgrimages."
The fixed airfare was Tk1.38 lakh for Hajj this year.