Strong upward trajectory illustrates robust recovery in India
- September 2022
- Phocuswright Research
India's total travel market grew to $19.1 billion in 2021 from $10 billion in 2020, registering 91% growth (see figure below). While this growth came on the back of a significantly diminished base, the strong upward trajectory illustrates a robust recovery after the pandemic-induced losses in 2020. All Indian travel supplier segments - airline, rail, hotel, and car rental - accelerated as Indians began to satiate their pent-up desire for travel in 2021.
The Indian economy underwent difficult circumstances due to repeated waves of coronavirus infection, supply-side disruptions, inflation and, more recently, rising fuel prices due to international geopolitical developments. However, the nation's economic fundamentals have remained robust, and data suggests that broader economic activities have returned to pre-pandemic levels. This will help the country achieve a real GDP expansion of 9.2% in 2021-22 after contracting 7.3% in 2020-21. Thus, the economic impact of the "second wave" in the second quarter of 2021 was relatively smaller than what the country experienced during the hard lockdown phases in 2020. India's fiscal deficit, despite massive welfare programs, is expected to remain at reasonable levels, leaving room for more government-led expenditures. All these developments will positively impact the travel sector, helping boost gross travel bookings to $28.6 billion by the end of 2022, and surpass the pre-pandemic level of $31.8 billion in 2023.
Political stability, with a clear mandate for the government, big-ticket investments in infrastructure, and a focus on augmenting domestic tourism with campaigns like 'Dekho Apna Desh' and the Leave Travel Concession (LTC) program, are likely to catalyze travel and stimulate further growth.
Looking ahead, Phocuswright analysts identified five key areas of development:
- New players and enhanced capacities shaking up the air segment
- Big-ticket infrastructure investments underway
- Thrust on growth in small cities
- Building a tech ecosystem
- Demand for alternate accommodation
Phocuswright’s India Travel Market Report 2021-2025 provides a comprehensive view of the India travel market, including detailed market sizing and projections, distribution trends, analysis of major travel segments, key developments and more.
Content includes areas of focus like key takeaways, a deep dive into the travel distribution landscape, and a focus on suppliers, OTAs, segments and mobile market that you can only find in a Phocuswright research report.
This report is part of the Asia Pacific Travel Market Report 2021-2025 series, which includes all of the following publications (available now or coming soon):
- Asia Pacific Travel Market Report 2021-2025
- Australia-New Zealand Travel Market Report 2021-2025
- China Travel Market Report 2021-2025
- Japan Travel Market Report 2021-2025
- Northeast Asia Travel Market Report 2021-2025
- Southeast Asia Travel Market Report 2021-2025
- Asia Pacific Travel Market Data Sheet 2021-2025 (Subscribers only)
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