Tourism Sector
Overview
The tourism sector in India is on a rise with the number of both outbound and inbound tourists increasing on year on year basis. The number of individuals undertaking foreign travel has been increasing at an average pace of 6-7 % per year. Being the second most populous country in the world and with increasing standards of living, the number of travellers has been increasing every year. India is already the third largest domestic civil aviation market in the world. As of 2016, India ranked third based on the number of passports issued. With 22.5 million outbound travellers in 2016, The number of Indian outbound tourists have been increasing at a rate of 11% in the past 5 years and is expected to reach the 50 million mark by 2020. Out of ~22.5 million people who travel abroad from India, 1.5 million go purely for MICE (Meetings, Incentives, Conferences, and Exhibitions.
During the period April 2000-December 2017, the hotel and tourism sector attracted around USD 10.9 billion of FDI into India. India is ranked among top 25 countries on International Tourism Expenditures. Indian outbound tourists incurred a total expenditure of ~USD 16 billion in 2016 and are projected to increase to 28 billion by 2020.
Growth Drivers
- India has 433,000 High Net Worth Individuals and 59 million urban middle class who have the capacity to spend.
- India is home to the 5th largest population of millionaires in the Asia Pacific region.
- India is the world's 5th largest economy by nominal GDP & 3rd largest by purchasing power parity. The economy is expected to grow robustly backed by the strong impetus of the Indian government on structural and economic reforms.
- Millennials in India increasingly want to travel and spend money on experiences.
Key Outbound Travel Destinations for Indian Travellers
Top 5 Preferred Destinations
- Thailand
- Singapore
- UAE
- Malaysia
- USA
Market Statistics
- In February 2018, the country earned foreign exchange of around ~USD 2.7 billion from the tourism sector.
- The travel & tourism sector in India accounted for ~8 per cent of the total employment opportunities generated in the country in 2017, providing employment to around 41.6 million people during the same year. The number is expected to rise by 2 per cent annum to 52.3 million jobs by 2028.
- The tourism and hospitality sector is among the top 10 sectors in India to attract the highest Foreign Direct Investment (FDI).