The Indian tourism and hospitality industry is on a roll, driven by the huge surge in both business and leisure travel by domestic and foreign tourists. The country's travel and tourism industry is expected to generate approximately US$ 100 billion in 2008, rising to Rs 15 US$ 275.5 billion by 2018 over the next ten years, as per the latest Tourism Satellite Accounting (TSA) research released by the World Travel and Tourism Council (WTTC) and its strategic partner Accenture.

The growth of tourist inflow into India was well above world average, leading to a rise of India's share in World arrivals from 0.37 per cent in 2001 to 0.53 per cent in 2006. Also, as noted by UN World Tourism Organisation (UNWTO), the growth of Indian tourism industry was instrumental in the 'emergence' of South-Asia as a tourist destination.

Further, tourism is an important industry in Indian economy contributing around 6.8 per cent of the Gross Domestic Product and providing employment to over 41 million persons. According to a research University of New South Wales (UNSW), Australian School of Business (ASB), India and China will be the new global players competing for a huge chunk of tourists, transforming the geopolitical landscape.

Inbound Tourists

The flow of foreign tourist arrivals has been recording phenomenal growth rates. The number of arrivals has increased from 3.9 million in 2005 to 4.4 million in 2006 and 4.9 million in 2007, recording a growth rate of 13.5 per cent in 2006 (over 2005) and 11.9 per cent in 2007 (over 2006).

Alongside, there has been a concomitant rise in the foreign exchange earnings. Total earnings from foreign tourists has shown an annual growth rate of 19.2 per in 2006 and 33.8 per cent in 2007 to garner US$ 7.49 billion in 2005, US$ 8.93 in 2006 and US$ 11.96 billion in 2007.

Continuing the foreign tourists’ interest in the country, the first quarter of 2008 recorded a growth rate of 12.2 per cent (in tourist arrivals) over the corresponding period in 2007, receiving 1.65 million in foreign tourist arrivals. Simultaneously, foreign exchange earnings grew by a much faster rate at 34.5 per cent in 2008, against 19.5 per cent during corresponding period in 2007. Total foreign exchange earnings totalled US$ 4.03 billion, against US$ 2.99 billion in 2007.

Significantly, while India's share in world arrivals was about 0.5 per cent, its share in revenue generated from tourism worldwide was over 1 per cent.

India, with its diverse landscape, offers huge scope for various theme-based travel like Medical Tourism, Adventure tourism, Heritage tourism, Wellness tourism, Pilgrimage tourism, Golf tourism, Eco-tourism, Wildlife tourism among others. India's growing reputation as a major medical tourism destination is attracting more and more foreign visitors. In fact, Indian hospitals are fast becoming the first choice for foreign patients and many travel agents are now offering packages combining treatment with a vacation.

In fact, according to the World Travel and Trade Council, Indian tourism demand will continue to grow at a rapid pace. It estimates the demand to grow at an average of 8.8 per cent between 2004 and 2013, making India the world's third fastest growing tourist market. The boom in the Indian tourism industry has cascaded to the rural areas as well. India continues to attract tourists owing to its splendid historical architecture and rich culture along with beautiful beaches, rural tourism or what now is called 'responsible tourism' is also fast gaining popularity with travelers flocking to discover the best in rural arts and heritage.

Outbound Tourists

With the economy growing consistently at over 9 per cent, increasing disposable incomes, a change in the spending habits, liberalization of exchange controls, increasing affordability due to numerous holiday packages and cheaper air fares, outbound tourist traffic has been growing at a rapid pace.