Impact of travel and tourism industry on the Indian economy

Wherein many international countries are still recovering from the pandemic repercussions. The Indian economy car is excellently speeding through it. Though many sectors are helping in progression but travelling and tourism is gearing the tempo.

India as a country is blessed with the geographical and climatic gifts of diversification, beautification and exuberance. Right from the snowy Himalayan mountainous ranges to the dense tropical forests of Kerala, India offers a wide variety of variations and suits the spirit of almost all keen travellers.

Not with, just the topography, India tends to attract visitors from in and around the world with its extremely welcoming, warm, and kind-natured citizens. “Atithi Devo Bhava” is fondly followed by Indians and the Indian government.

All of these highly adaptable features make the Indian tourism industry an economic multiplier. Increasing investment destinations, thriving digitalisation, and gen Z-friendly platforms like Travel Now Pay Later (TNPL), are making travelling and tourism a fortune wheel for the Indian growth scale.

According to the WTTC (World Travel and Tourism Council), the travel and tourism sector’s contribution to the Indian GDP will outpass the pre-pandemic levels by 2024, and this seems to get true with the G-20 delegation coming to India. The tourism sector upscaling vigorously helps the country flourish as this sector push open the gate of opportunities for many other fields. Generating jobs, enhancing skills, inspiring local artisans and tradespeople, and providing economic support to hotels, entertainment, and transportation services.

India is now outshining and gaining fame for facilitating the best of the best services in medical tourism, ecotourism, adventure tourism, cruise tourism, cultural tourism, and pilgrimage tourism and now as evident with the G-20 leadership, business travel will too become extremely popular. With so much so, it is expected that Indian tourist arrivals will reach 30.5 million and will generate approximate revenue of over 59 USD billion dollars by 2028.

The potential and growth of tourism are evident and appreciated which is why the respected finance minister Nirmala Sitharaman during her budget 2023 presentation quoted “50 tourist destinations will be selected through challenge mode to be developed as a whole package for domestic and international tourism”. The Foreign Exchange Earnings (FEEs) through tourism in India for the years 2019 to 2021 is ₹ 2,11,661cr in 2019, ₹50,136cr in 2020 and ₹65,070cr in 2021,” the ministry informed the Upper House.

The increased FTA (Foreign Tourist Arrivals) will certainly increase the potential of foreign exchange income and foreign investment in India which again in return will help the country and our countrymen to prosper.

It is not only about the financial inputs, the booming travel and tourism industries also provide a sustainable overall human development with 20 million people currently working in the Indian tourism industry, it is also anticipated that employment opportunities in the upcoming years will raise up to 140 million.

The fast pacing tour and travelling industries have improvised themselves to another level by habituating and accepting the mate ship of technology and digitisation. The online marketing of the packages and advertising even the rarest and least known tourist destinations has increased the interest of not only outsiders but of Indian explorers too, in fact, Indian tourists are predicted to be amongst the top spenders in 2023.

Rajneesh Bansal
Managing Director, Paul Merchants

Tours and travel companies are constantly putting in the hard labour to understand and move one step ahead of the trend. With staycation, workcation and many other new trends setting in, firms are trying to accommodate and provide the best travel experience to the shoppers. As tour and travel companies play an integral role in being a part of the financial development of the country. One can hope that our country too attains a lot of financial success with our government’s Swadesh Darshan 2.0 scheme.

Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Economic Times – ET Edge Insights, its management, or its members

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