Post Covid-19, a Critical Development In Tourism Economy is Expected

In 2029, the Indian travel and tourism industry will be worth $512 billion. This is massive growth from four years prior, in 2022, when it was valued at only $121.9 billion or 4.6 percent of the GDP. A big reason for this massive growth is that there are restrictions coming down, and we expect things to calm down a lot!

The travel and tourism sector in India is expected to reach $243 billion (INR 15.2 lakh Cr) by the year 2028 at a CAGR of 14% over the next decade, according to global reports published this month. The Indian Adventure Tourism industry is projected to register a growth of more than 20% a year till 2023, and by now, valued at INR 30 K crore isn't all that high by global standards.

 This optimism emanates from the growing number of people holidaying in these remote areas across India and other previously unexplored destinations seeing an influx in tourists coming to these places specifically because they cater to an increasingly discerning travel class seeking curated experiences specific only to these lesser-known spots as opposed to standard tourist hotspots where millions visit year after year and find it hard to discover anything new.

The Anand Rathi report points out that with the lockdown to prevent further spread of the Covid-19 at 6.9 billion in 2020, 74?wer tourists are coming to India than they did before. The primary states that were significantly affected by these numbers were Uttar Pradesh, Tamil Nadu, Andhra Pradesh and Maharashtra. However, all sectors within India's tourism industry have drastically been impacted by this loss of tourism as a result of the lockdown. Domestic and International Tourist Visas issued have seen 36% and 30% growth in their respective categories, according to the Department for Promotion of Industry and Internal Trade (DIPP).

The report notes that there has been an explosion of interest among foreign investors (particularly in the travel industry) in a sector that is governed by the Ministry of Tourism. Moreover, with leveraging tourism as a central plank, it's no surprise that foreign players are eager to tap India, a destination where over 133 million foreign tourists made trips in 2016 to see its many attractions.

According to the comparative analysis provided in JLL's report titled 'Hotel Momentum India,' the performance of the Indian hospitality sector showed steady growth and attained a 39.1% year-on-year (YoY) revenue per available room (RevPAR) growth in Q1, 2022. Mumbai achieved the highest growth with 71.5% YoY RevPAR over a similarly dated last year. This dominant position is primarily due to major domestic and international sporting events held in this region. The report further details that domestic hotel operators have captured a considerable market share at 75%.

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