By BW Hotelier
INDIANS MADE over 18 million outbound trips in 2014, an increase on the 16 million trips made in 2013. Barely 2 per cent of India’s population currently travel overseas but over the past five years the country’s middle classes have increased by over 10 per cent. This demographic is set to grow from 32 per cent at present to 50 per cent by 2030, making it a major source market with tourism boards vying to tap into this potential tourist goldmine, according to a report published by Travel and Tourism Intelligence Center (TTIC).
The report said India is expected to increase its business travel and tourism following the election in May 2014. However, outbound tourism will be challenged by the domestic tourism industry.
India’s economic rise will introduce a new generation of middle class tourists to overseas travel. The country’s GDP has grown to 5.4 per cent this year and is expected to reach 6.7 per cent by 2019. Total outbound spending has grown to over $13 billion US,-but domestic investment could threaten the dominance of international trips, the report stated.
India is currently experiencing a domestic tourism boom. The number of domestic trips reached over 1.3 billion in 2014, representing a 14.1 per cent increase on 2013 figures. This accounts for more than three-quarters of India’s entire tourism market, more than double the growth rate of outbound departures during 2014. Part of the rise of domestic tourism can be attributed to growth of lower middle class incomes ’ the type of domestic consumer who cannot afford the flight prices to journey abroad, but who want to turn a religious pilgrimage into a family holiday. Since 2010, many Indians who once had intentions of traveling abroad had their plans curtailed because of the sharp fall in the rupee, which lost much of its value against the dollar, causing planned foreign holiday travel to become too expensive for many of the aspiring middle classes. Interestingly, this has increased domestic tourism throughout the country with international hotel groups reflecting this emerging market as Starwood French Group, Accor, and the Hilton Group all look set to benefit.
According to a 2013 Ministry of Tourism report, Tamil Nadu ranks number one in drawing the maximum number of domestic tourists with a 20 per cent share, followed by Uttar Pradesh (17 per cent) and Andhra Pradesh (16 per cent). Maharashtra comes fifth (6.4 per cent), while Gujarat and West Bengal rank eighth and ninth respectively.
Indian travelers characteristically have been avid business travelers with 40 per cent of all departures accounted for by business trips. While most of this MICE (meetings, incentives, conferences and events) tourism has been consistently to the Asia-Pacific region, TTIC expects that changing trends in India’s economy will spur a rise in leisure and VFR travel to the Middle East and Europe over the forecast period
Key destinations include Thailand and UAE, as well as increasing visitors to the US. Although outbound tourism is growing, domestic investment could threaten the dominance of international trips.
The average length of outbound trips (number of nights) stood at eight nights in 2013, with little change since 2012. However, TTIC expects Indian travellers to increase the length of their outbound trips over the forecast period in line with the potential economic growth currently taking place. Consequently, length of overnight stays is forecast to increase to nine nights by 2019.
INDIANS MADE over 18 million outbound trips in 2014, an increase on the 16 million trips made in 2013. Barely 2 per cent of India’s population currently travel overseas but over the past five years the country’s middle classes have increased by over 10 per cent. This demographic is set to grow from 32 per cent at present to 50 per cent by 2030, making it a major source market with tourism boards vying to tap into this potential tourist goldmine, according to a report published by Travel and Tourism Intelligence Center (TTIC).
The report said India is expected to increase its business travel and tourism following the election in May 2014. However, outbound tourism will be challenged by the domestic tourism industry.
India’s economic rise will introduce a new generation of middle class tourists to overseas travel. The country’s GDP has grown to 5.4 per cent this year and is expected to reach 6.7 per cent by 2019. Total outbound spending has grown to over $13 billion US,-but domestic investment could threaten the dominance of international trips, the report stated.
India is currently experiencing a domestic tourism boom. The number of domestic trips reached over 1.3 billion in 2014, representing a 14.1 per cent increase on 2013 figures. This accounts for more than three-quarters of India’s entire tourism market, more than double the growth rate of outbound departures during 2014. Part of the rise of domestic tourism can be attributed to growth of lower middle class incomes ’ the type of domestic consumer who cannot afford the flight prices to journey abroad, but who want to turn a religious pilgrimage into a family holiday. Since 2010, many Indians who once had intentions of traveling abroad had their plans curtailed because of the sharp fall in the rupee, which lost much of its value against the dollar, causing planned foreign holiday travel to become too expensive for many of the aspiring middle classes. Interestingly, this has increased domestic tourism throughout the country with international hotel groups reflecting this emerging market as Starwood French Group, Accor, and the Hilton Group all look set to benefit.
According to a 2013 Ministry of Tourism report, Tamil Nadu ranks number one in drawing the maximum number of domestic tourists with a 20 per cent share, followed by Uttar Pradesh (17 per cent) and Andhra Pradesh (16 per cent). Maharashtra comes fifth (6.4 per cent), while Gujarat and West Bengal rank eighth and ninth respectively.
Indian travelers characteristically have been avid business travelers with 40 per cent of all departures accounted for by business trips. While most of this MICE (meetings, incentives, conferences and events) tourism has been consistently to the Asia-Pacific region, TTIC expects that changing trends in India’s economy will spur a rise in leisure and VFR travel to the Middle East and Europe over the forecast period
Key destinations include Thailand and UAE, as well as increasing visitors to the US. Although outbound tourism is growing, domestic investment could threaten the dominance of international trips.
The average length of outbound trips (number of nights) stood at eight nights in 2013, with little change since 2012. However, TTIC expects Indian travellers to increase the length of their outbound trips over the forecast period in line with the potential economic growth currently taking place. Consequently, length of overnight stays is forecast to increase to nine nights by 2019.
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