(CNN) — International travelers have been flocking back to the popular resort island of Bali as the Covid pandemic subsides, prompting hopes that Indonesia's battered tourism industry is on the road to recovery.

But this week, controversial new laws were passed in parliament that ban cohabitation and sex outside marriage. The laws will apply not just to residents but also to foreign expats and tourists in the country -- raising concerns from experts.

Although the changes are not expected to kick in for at least another three years, industry players tell CNN that the new criminal code could put foreigners off visiting and hurt the country's global reputation, starving it of vital tourism revenues.

A turnaround for travel operators

"From our point of view as tourism industry players, this law will be very counterproductive for the tourism industry in Bali -- particularly the chapters about sex and marriage," said Putu Winastra, chairman of the country's largest tourism group, the Association of The Indonesian Tours And Travel Agencies (ASITA).

The new laws are seen as response to rising religious conservatism in Muslim-majority Indonesia in recent years, with parts of the country enforcing strict Islamic codes. In Bali, the population is predominantly Hindu and as a result has tended to have a more liberal social environment that appeals to Western tourists.

Indonesian lawmakers have defended the new laws, saying they were an attempt to satisfy "public aspiration" in a diverse nation. Law and Human Rights Minister Yasonna Laoly said on Tuesday that it wasn't easy for a multicultural and multi-ethnic country to make a criminal code that "accommodates all interests."

Winastra says that the new laws caught him and others off guard because they felt the government had been very enthusiastic about increasing foreign tourist arrivals. "Now there will now be rules and laws that will burden tourists and the industry," he added.

Like most major tourist hotspots around the world, Bali suffered significant economic turmoil during the Covid-19 pandemic.

From more than 500,000 foreign visitors each month, arrivals slumped to as low as 45 for the entire year of 2021.

But with the pandemic in retreat, government and tourism industry officials had been forecasting a healthy revival, potentially bringing in billions of dollars of revenue for the Indonesian economy.

Earlier this year, the World Travel & Tourism Council, a global industry body, forecast annual growth of 10% for Indonesia's travel industry over the next 10 years, predicting the sector would contribute nearly $118 billion dollars to the country's GDP while creating more than 500,000 jobs each year for the next decade.

Local guide Ken Katut told CNN Travel that he believed things were "progressing in the right direction" in the tourism industry after G20 leaders held a summit in Bali in November.

Hotels were bustling with delegates, Ken said, and he was "thrilled" to be busy ferrying tourists around the island.

"The G20 was great for us who had been out of work during the pandemic," he said. "It really brought Bali back to life."

Now, some worry the momentum will be cut just as it was starting to pick up again.

What to know

Under the new criminal code, anyone -- Indonesians or foreigners -- found guilty of adultery or premarital relations could face 12 months in jail. It's not yet clear how these laws will be enforced.

"Do tourist couples (visiting Bali) have to prove that they are married? Should we be asking them if they are married or not?" wonders Putu.

"Now foreign tourists will think twice about traveling to Bali because they might be jailed for violating the laws."

Rights groups have noted how the laws will disproportionately affect women and members of the gay community, and added that they could "provide an avenue for selective enforcement."

Hotel operators have also objected to the laws, saying it would be difficult for them to enforce.

"Asking couples whether they are married or not is a very private area and it will be an impossible task to do," said Ida Bagus Purwa Sidemen, Executive Director of the Indonesian Hotel & Restaurant Association (PHRI).

Sidemen feels that the Indonesian government will review the laws following public backlash. "We just can't be asking every couple about their legal marital statuses. It will create huge problems for us," he said.

"But what is going to happen to us now if the new laws scare tourists off? Will we go back to how we were during the pandemic?

"The government can't be wanting tourist (revenue) and at the same time enforcing these laws that will scare people away. It just doesn't make sense."

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