Indian Rail Rides On

While it may not rival Japan's bullet trains or the high-speed rail network that increasingly crisscrosses Europe, India's railway system is nonetheless a force to be reckoned with. In addition to being the nation's largest employer, the state-run Indian Railways sells approximately 1.72 billion rail tickets annually (either direct or through intermediaries), according to Phocuswright's Indian Online Travel Overview Third Edition.

And a significant portion of these tickets are sold online. In 2010, 23% of rail bookings were transacted online, either through the website run by Indian Railways' tourism arm (IRCTC), or via an increasing number of online travel agencies (OTAs). In 2009, the IRCTC made its API available to OTAs, and this effort to broaden its distribution network has been a catalyst for further growth.

"Despite the relatively low ticket prices, online penetration for rail in India has been impressive from the very beginning," says Ram Badrinathan, general manager, asia pacific and vice president, Learning Solutions at Phocuswright. "Now that a variety of OTAs are able to sell rail tickets as well, we will definitely see more growth in this space."

In 2010, the IRCTC site, which has been the largest travel website in the entire Asia Pacific region in terms of transaction volume, introduced a domestic air booking service. However, this initiative could very well meet with mixed results, and in this sense the IRCTC may be a victim of its own success; most consumers believe that the IRCTC is only about rail, and they are unlikely to abandon more full-service OTAs (or supplier websites) when shopping for air online.

Phocuswright's Indian Online Travel Overview Third Edition is a comprehensive analysis of India's dynamic travel marketplace (projected to grow to nearly US$20 billion by 2011), with emphasis on an online channel that is increasingly driven by innovation and rapid technology adoption. The report delivers the numbers, knowledge and insight that travel companies need to take advantage of this extraordinary opportunity. Purchase today for just US$795