Categories: Travel

India set to be the fourth-largest global travel spender by 2030, ET TravelWorld

On January 30, 2020, the World Health Organization (WHO) declared the coronavirus outbreak a public health emergency of international concern, and the same year, the United Nations World Tourism Organization (UNWTO) reported that over 100 million direct tourism jobs were at risk. The economies of tourism-dependent countries suffered extensively, but a recovery is in full flow.

The aviation analytics firm Cirium has stated that global airline capacity is slated to finally surpass its 2019 levels. This signals a significant recovery from the losses that the global travel market suffered during the pandemic.

Air travel is on the upswing across the world, and India in particular exemplifies this resurgence. India’s domestic air traffic touched a new peak on April 30 this year, with over 456,082 passengers travelling in a single day as 2,978 flights took to the skies.

Today, Big data is being leveraged by the tourism industry in every possible way. According to an analysis conducted by Global Data, the AI market which was valued at USD 81.3 billion in 2022, is expected to grow at the rate of 35% by 2030. These tools are being incorporated into devices, business applications and productivity tools for seamless business operations.

In October, Booking.com and McKinsey & Company released ‘How India Travels’, a report projecting India as the fourth-largest global spender in travel by 2030, with expenditure that is expected to reach up to USD 410 billion. This indicates a 173 percent increase from 2019, when Indian travellers cumulatively spent over USD 150 billion. Interestingly, the report also indicates that in 2022, Indian travellers helped in the recovery of the tourism industry by spending 78 percent of the 2019 levels, while Asia as a whole reached just about 52 percent. The number of trips taken by Indian travellers is also slated to increase to 5 billion in 2030, even as the air traffic in India continues to grow at twice the pace of its GDP (Gross Domestic Product).

The phenomenon of ‘revenge tourism’ (people taking big trips to take revenge against the pandemic) could also have something to do with this spurt. Avid travellers in India and across the world are shedding off their pandemic ennui with a vengeance to jet off towards their dream destinations. This year, among these travellers in India, there was also a large segment of first-time flyers.

Many of these new travellers are from the millennial and Gen Z generations, who consider travel to be an experiential and aspirational activity. The growing popularity of travel influencers has also increased the tourist influx to aspirational and ‘trending’ locations. These could range from a highly-rated homestay in Leh to an Aurora ‘glamping’ resort in Iceland!

Indians are also spending far more on luxury travel now, and Thomas Cook India reports a 50% jump in business class travel versus last year. In March this year, they noted a 5-10% growth in demand for premium seats compared to 2019-20.

Analysts expect growth to be powered by the growing Chinese and Indian middle classes — as well as a younger generation more keen to travel than their parents. But OAG warns the region’s tourism has sometimes been over-reliant on China, and for now Chinese visitor numbers are still way below pre-pandemic levels as the Asian superpower grapples with a challenging economic slowdown.

However, for this boom to be sustainable, the aviation industry must formulate a way to deal with not just an increasing demand for better connectivity and convenience but with spiralling turbine fuel prices, supply chain challenges, and financial distress that have grounded many ambitious airlines. Engine issues and inadequate MRO infrastructure need attention as well.

Updated airports, modern fleets, smart air traffic management systems to prevent delays and congestion, and a skilled workforce are some of the key elements that can support this growth.

We are witnessing a renaissance indicative of India’s unmatched ability to rise above unprecedented challenges brought on by and following the global pandemic. If we continue to capitalise on the limitless opportunities for growth, India’s post-pandemic narrative will become even more inspirational and dynamic.

The author is Group Chairman, Sky One

DISCLAIMER: The views expressed are solely of the author and ETTravelWorld.com does not necessarily subscribe to it. ETTravelWorld.com shall not be responsible for any damage caused to any person/organisation directly or indirectly.