Hajj-linked business takes hit as high costs hold back aspirant pilgrims

Infograph: TBS

Khalilur Rahman had planned to undertake the Hajj pilgrimage this year with his wife. But the 60-year-old from Rajshahi has had to forgo his plans as the Hajj package has become costlier by around Tk1.5 lakh compared to the previous year.

This year the cost of the pilgrimage, which is managed by private agencies, is around Tk6.73 lakh, excluding qurbani, whereas Khalilur Rahman's budget was limited to Tk5 lakh.

Khalilur Rahman is not alone in ditching his plans because of a big jump in expenditure.

Despite massive interest among people, as of Wednesday, only 66,810, or around 53%, of aspirant pilgrims had completed registration against the country's quota of 1.27 lakh in 2023, even after the deadline was extended three times.

According to hajj agencies and travel agents, the increase in cost is due to higher expenses on both the Bangladesh and Saudi Arabia sides.

The Hajj Agencies Association of Bangladesh (Haab) has mainly blamed Biman Bangladesh Airlines for the high air fare that has driven up the total cost of the hajj package.

Aside from the high air fare, the hajj agencies have identified an increase in foreign exchange rates as another major reason for the higher pilgrimage costs. Currently, the exchange rate for the Saudi riyal is Tk28.34, which is significantly higher than Tk24.30 in the previous year.

On Tuesday, the religious affairs ministry set 16 March as the final deadline, saying no further extensions would take place. However, hajj agencies fear that Bangladesh might fail to fulfil the quota for the first time in its history, which may affect businesses involving hajj.

"I did pre-registration to perform hajj. Now, all the expenses, including the scheduled Hajj package, will require Tk8 lakh, and the total cost for both of us – my wife and I – will amount to Tk16 lakh," Khalilur Rahman told The Business Standard.

"If the total cost stands at Tk10 to Tk11 lakh, both of us want to perform Hajj. In the present circumstances, we are planning to perform umrah," he added.

The current cost for umrah from Bangladesh is Tk1.5 to Tk2 lakh per person, according to hajj agencies.

Umrah is an Islamic pilgrimage to Mecca – the holiest city for Muslims located in Saudi Arabia – that can be undertaken at any time of the year, while hajj is observed on specific dates according to the Islamic lunar calendar.

Moreover, hajj is a week-long Islamic ritual and a must for financially capable Muslims at least once in their lifetime.

Akbar Ali, proprietor of the hajj agency At-Tyaara Travels International, used to send around 1,000 hajj pilgrims each year in the pre-Covid period. But this year, only 300 aspirant pilgrims have registered through his agency.

"If the deadline is extended, we will get the highest 500 pilgrims this year. Many people are converting their plans from hajj to umrah as costs have risen," he told TBS. 

Stating that the cost in Saudi Arabia is higher than it was before Covid, he said, "Last year in the Covid situation, the country increased the cost to about 8,000 riyals. This time, it has not been reduced much. This time the country has set the cost at around 6,000 riyals (about Tk1.80 lakh), which was a maximum of 2,500 riyals before Covid."

"This time, Bangladesh Biman has fixed the air fare at around Tk1.98 lakh, which was Tk1.40 lakh last year," he added.

Pointing out that the cost could have been reduced on both sides, he said, "If the air fare had been Tk1.5 lakh, then about Tk50,000 would have been saved. And if the cost was reduced by 3,000 riyals (about Tk90,000) in Saudi Arabia, then it would have been about Tk1.5 lakh. By saving, we could have fixed the package at last time's price."

"If the fares are not reduced and people don't go for hajj then how will Biman do business," he asked.

The main expenses in Saudi Arabia are service charge, Mecca route service, visa fee, and transport service.

Accommodation expenses in Saudi Arabia are Tk2.04 lakh this year, compared to Tk1.58 lakh last year.

According to stakeholders, hajj agencies in Bangladesh mainly pocket money from pilgrims' accommodation fees. They collect high service charges from pilgrims but provide them with subpar hotels.          

However, Maulana Eyaqub Sharafati, senior vice-president of Haab, told TBS, "It happens here due to the devaluation of the taka against the dollar."

He expects that they will finally be able to fulfil the quota this year.

Haab Secretary General Faruk Ahmed Sardar told TBS, "Those who go to Saudi Arabia for hajj take riyals with them to spend there. Devaluation of the taka against the riyal and the dollar is also a reason for people being discouraged this time."

Biman depends on the air fare hike

Some 50% of pilgrims will travel on dedicated hajj flights of the national flag carrier Biman, and the rest of the pilgrims will be transported by Saudia and Flynas.

Speaking to TBS, Shafiul Azim, managing director of Biman, criticised the hajj agencies for holding the air fare mainly responsible for the high hajj package.

"The hajj package consists of 16 types of expenses. Like those who blame the air fare alone, we can also blame them for the increase in hotel fares, but we should not do that because there is a logical reason for the increase in costs," he said.

"In 2023, taking into account the increased exchange rate of the dollar, the increase in the price of jet fuel, and the increase in taxes decided by the governments of both countries, the air fare for hajj pilgrims this year has been fixed at Tk1.97 lakh. It has been decided, based on the opinion of the religious affairs ministry, hajj agencies and experts concerned," he added.

In no way was the airfare set higher than the market price, he said, adding, "Initially, Tk2.10 lakh was proposed, but it was further reduced on everyone's recommendation."

He further said that it is not possible for Biman to provide services while incurring losses during the current financial crisis.