Introduction
India continues to rank among the world’s most dynamic tourism markets, with the sector playing a central role in the country’s services-led growth story. Supported by rising domestic travel, expanding aviation capacity, and steady hospitality investments, tourism has evolved into a strategic economic pillar. The industry contributes significantly to GDP and employment generation, while serving as an important source of foreign exchange earnings and regional economic development.
The breadth of India’s tourism ecosystem spans heritage, spirituality, wildlife, eco-tourism, medical travel, and experiential leisure segments. From Himalayan landscapes and coastal biodiversity to cultural circuits and archaeological landmarks, the country offers diversified travel experiences across states and union territories. This diversity, combined with improving infrastructure and digital integration, strengthens India’s competitive positioning in the global tourism landscape.
Recent policy direction reflects a structured and forward-looking approach. The Union Budget 2026–27 underscores tourism as a high-impact growth sector through destination development, skill enhancement, digital platforms, and
sustainability-focused initiatives. Programmes such as Buddhist circuit expansion, eco-trail development, medical tourism hubs, and heritage revitalisation signal a shift towards experience-driven, inclusive, and regionally balanced tourism growth. Together, these measures position India’s tourism industry for long-term expansion aligned with economic and social development objectives.
Market Size
Government initiatives such as the Vision@2047 aim to attract 100 million inbound tourists by 2047, reinforcing India’s position as a global tourism hub. According to the World Travel & Tourism Council (WTTC), the sector’s contribution to GDP is projected to rise from US$ 256 billion in CY24 to US$ 523 billion in CY34, supporting about 63 million jobs. WTTC also forecasts another record-breaking year in 2025, with the industry expected to contribute over Rs. 22,00,000 crore (US$ 257.40 billion) and employment set to exceed 48 million.
In 2023–24, the travel and tourism sector in India generated approximately 84.63 million jobs (including both direct and indirect employment). During the same period, the sector’s total contribution to India’s GDP stood at 5.22%, reflecting its significant role in the national economy. During July–September, India received around 1,44,000 foreign tourist arrivals for medical purposes, reflecting steady demand for affordable healthcare and wellness services. Asia & Pacific and Africa remained key contributors, highlighting India’s growing position as a global medical tourism destination.
Foreign Tourist Arrivals (FTAs) in India stood at around 9.15 million in 2025, reflecting sustained international travel interest supported by improved connectivity and diversified tourism offerings. In 2025, the top source countries were the USA (20.1%), UK (11.9%), Australia (6.0%), Canada (5.9%), and Bangladesh (5.1%). Foreign exchange earnings in 2025 totaled 2,76,831 crore (US$ 31.69 billion).
Domestic tourism continues to drive growth, with visitor spending reaching Rs. 15,50,000 crore (US$ 185.6 billion) in 2024, 22% higher than pre-pandemic levels, and expected to rise to Rs. 16,80,000 crore (US$ 200.17 billion) in 2025. International visitor spending also grew, rising to Rs. 3,10,000 crore (US$ 36.8 billion) in 2024 and projected to touch Rs. 3,20,000 crore (US$ 37.47 billion) in 2025.
Air travel and hospitality are equally buoyant. In FY26, passenger traffic at Indian airports reached 420.09 million, registering a 1.9% year-on-year growth compared to 412.09 million passengers in FY25, while the airline market, valued at around US$ 20 billion, is projected to double by FY27 due to improving airport infrastructure and greater passport access. The hotel industry, estimated at US$ 32 billion in FY20, is expected to grow to US$ 52 billion by FY27, supported by strong demand from domestic and international travellers. Premium hotel occupancy is projected to improve from 70-72% in FY25 to 72-74% in FY26, with revenue growth of 7-9% in FY25 and 6-8% in FY26.
Emerging trends such as pet-friendly travel are also shaping the market, with bookings for flights and accommodations involving pets rising between 26% and 43% year-on-year in FY25. Overall, India’s travel and tourism industry is expected to grow at 7.1% annually, fuelled by rising disposable incomes, diverse offerings, and steady foreign investments.
Investments/Developments
- Based on the India Tourism Data Compendium 2025 by the Ministry of Tourism, the sector contributes 5.22% to India’s GDP (total impact), with a direct share of 2.72%. It also supports 13.34% of total employment, with a direct employment share of 5.82%, reflecting its strong role in livelihood generation and inclusive development.
- As per provisional National Accounts Statistics 2025 estimates, the tourism sector contributed Rs. 1,19,747 crore (US$ 18.76 billion) to India's GDP. This reflects the sector's strong economic role in India.
- India's tourism and hospitality sector is poised to reach nearly US$ 60 billion by 2028, driven by domestic and international traveler spending expected to triple by 2034. Domestic air travel is projected to more than double by 2030, increasing demand for quality accommodations.
- Goa’s tourism sector witnessed strong momentum in 2025, driven by domestic tourist arrivals crossing 1 crore and pushing total visitor numbers close to 1.1 crore. The steady inflow of Indian travellers continues to strengthen the state’s tourism economy while supporting overall recovery and growth across key destinations.
- India recorded 5.34 lakh foreign tourist arrivals in April 2026. Domestic tourism is also strong, with over 303 crore domestic tourist visits. Various thematic circuits developed under government schemes like 'Swadesh Darshan' are enhancing leisure tourism options such as cultural, coastal, and tribal circuits.
- Indian overseas travel data shows a sharp uptick in leisure travel by Indians abroad, with leisure travel making up 42.52% of foreign departures by Indians in 2024. This underscores leisure travel as a growing segment both inbound and outbound for India.
- Domestic tourism has become the cornerstone of India's hospitality growth, contributing nearly 88% of total tourism spending. Urban Indians increasingly prefer shorter, experience-led breaks like wellness and adventure tourism. This regional travel focus is expanding new markets in Tier-II and Tier-III cities and driving infrastructure development.
- A joint report by the Ministry of Tourism and NITI Aayog estimates wellness tourism alone could contribute US$ 18 billion to India's GDP by 2030, highlighting growth in specialized tourism segments.
- As per JLL’s Hotel Investment Trends in India 2025 report, hotel investment activity in India increased by 67% year-on-year to Rs. 4,933 crore (US$ 567 million) across 28 transactions in CY2025, reflecting strong investor confidence in the hospitality sector. Institutional investors and private equity firms accounted for 35% of hotel transaction volume in CY2025, driving investment activity worth approximately Rs. 1,727 crore (US$ 198.5 million).
- As per redBus India BusTrack Report 2026, India’s intercity bus industry recorded 147.19 million passenger journeys and a gross ticketing value of Rs. 142.16 billion (US$ 1.63 billion) during October 2025–March 2026, reflecting strong travel demand across the country. The intercity bus market grew by 24% year-on-year in terms of passengers travelled during October 2025–March 2026, highlighting the continued expansion of road-based travel in India.
- As per JLL’s Hotel Investment Trends in India 2025 report, India recorded branded hotel openings of approximately 8,990 keys across 103 hotels in CY2025, with 64% of the new inventory added in tier-II and tier-III cities.
- India's hotel market is shifting to rate-led growth supported by infrastructure expansion and growing domestic tourism. The sector attracted US$ 340 million in hotel transactions in 2024, making India the second-largest hotel investment market in Asia Pacific, with over 690 new hotel projects underway.
- India’s medical tourism market, valued at US$ 7.7 billion in 2024, is projected to reach US$ 16 billion by 2030. The sector has seen significant private investment inflows and plans to add 34,000 new hospital beds by 2029, enhancing capacity for international patients.
- OYO announced in January 2025 plans to add 500 new hotels in India's religious tourism hubs by the end of the year, including destinations like Ayodhya, Varanasi, and Haridwar, to meet the rising demand from pilgrims.
- Sarovar Hotels is set to launch Nepal's largest hotel, featuring 304 rooms under the Royal Tulip brand, in the first half of CY25.
- India’s Union Budget FY27 has allocated Rs. 2,335 crore (US$ 253.8 million) to boost its tourism sector, focusing on improving infrastructure, skill development, and travel facilitation through measures like developing 50 top tourist destinations, offering MUDRA loans for homestays, enhancing connectivity, and introducing e-visa facilities.
- In May 2026, Radisson Hotel Group announced plans to expand its portfolio in India to 157-160 hotels with up to 19,500 keys by the end of 2026. The expansion reflects the group’s continued focus on India’s growing hospitality market, supported by strong development activity across metro as well as tier-II and tier-III cities.
- In May 2026, Hotel Palacio launched its second property in Guwahati and announced an expansion roadmap of Rs. 800 crore (US$ 87.0 million) to develop 10 new properties over the next decade. The investment is aimed at strengthening hospitality infrastructure in Northeast India and supporting the region’s growing tourism and business travel demand.
- In May 2026, IHG Hotels & Resorts signed a strategic agreement with Adani Airport Holdings to develop five hotels with nearly 1,500 keys across key airport-led destinations in India.
- In April 2026, Nomura stated that India’s hospitality sector has entered a “golden cycle”, supported by sustained growth in average room rates, strong investment returns and attractive valuations.
- In March 2026, MakeMyTrip announced the acquisition of a majority stake in regional tour operator Flamingo Transworld to strengthen its holiday packages business and expand its presence across key regional markets in India.
- In February 2026, MakeMyTrip announced a collaboration with OpenAI to enhance AI-led travel discovery through new features integrated into its Myra interface. The initiative enables travelers to move seamlessly from conversational planning to booking, strengthening AI-driven travel planning and personalized user experiences.
- In February 2026, Chalet Hotels approved an investment of Rs. 632.8 crore (US$ 69.7 million) to develop a new ~330-room luxury hotel along with commercial and retail space in Hyderabad. The project is expected to be operational by FY29. The development aims to strengthen premium hospitality capacity in the city while creating diversified revenue opportunities through integrated commercial infrastructure.
- In February 3, 2026, Indian Hotels Company Ltd. (IHCL) signed a framework agreement with Rajdarbar Group to develop seven new Ginger hotels across North India. The expansion targets key Tier-2 and pilgrimage destinations, including Jaipur, Agra, and Mathura, adding over 1,000 keys. The move strengthens IHCL’s presence in the growing midscale hospitality segment, driven by rising aspirational travel demand.
- In January 2026, EaseMyTrip partnered with ProXpense to launch an AI-driven corporate travel and expense management ecosystem. The collaboration integrates automated expense workflows with travel booking services, enabling enterprises to streamline planning, compliance and real-time travel spend management.
- Radisson Hotel Group and MBD Group signed a long-term Master Franchise Agreement to expand luxury and lifestyle brands Radisson Collection and Radisson RED across India. The partnership aims to strengthen premium hospitality offerings, including the upgrade of Radisson Blu MBD Hotel Noida into Radisson Collection MBD.
- India has emerged as Marriott International’s hotspot in the Asia Pacific region excluding China (APEC), as it celebrated a milestone year in 2025 with 99 hotel signings and over 12,000 rooms added.
- OYO invests Rs. 86.69 crore (US$ 10 million) to enhance G6 Hospitality’s digital assets, aiming to boost direct bookings and expand its US footprint with 150+ new hotels by 2025.
- The Maha Kumbh 2025 has become one of the largest religious gatherings in history, with over 450 million (45 crore) devotees participating in the bathing rituals as of February 11, 2025.
- In April 2024, EaseMyTrip.com launches its first franchise store in Karnal, Haryana, as part of its expansion via the franchise model, reinforcing its dedication to offering superior experiences across offline and online channels.
- As of February 2024, Ayodhya is anticipated to host between 50 to 100 hotels over the next 3 to 4 years. The city, acclaimed as a global religious destination, is primed for substantial development, with Taj Hotels poised to establish its fourth property in the area.
- In March 2024, MakeMyTrip revealed a partnership with the Department of Tourism, Madhya Pradesh, and redBus to boost tourism in the region, aiming for sustainable development and positioning Madhya Pradesh as a premier destination.
- In March 2024, Indian Hotels Corporation Ltd (IHCL) has announced plans to recruit 2,000-2,500 employees in the fiscal year 2025. This expansion of the workforce aligns with IHCL's ambitious plans, which include a pipeline of 85 hotels.
Government Initiatives
Under the National Monetisation Pipeline (NMP) 2.0, the Government of India has proposed the redevelopment of Hotel Ashok and Hotel Samrat in New Delhi through PPP-based private sector investment. The projects aim to modernise existing hospitality assets, with Hotel Ashok targeted for FY27 and Hotel Samrat for FY30. The initiative is expected to enhance tourism infrastructure while attracting long-term investment into India’s hospitality sector.
The Union Budget 2026–27 positions tourism as a high-impact growth sector, focusing on infrastructure upgrades, workforce development, and sustainable destination planning to boost employment, investment, and regional tourism growth across India.
A new scheme has been announced to develop Buddhist circuits across Arunachal Pradesh, Assam, Sikkim, Manipur, Mizoram, and Tripura, including connectivity upgrades, pilgrim amenities, and heritage conservation to strengthen spiritual tourism.
The government has proposed mountain, turtle, bird-watching, and eco-nature trails across the Himalayan, coastal, and biodiversity regions to promote sustainable tourism while leveraging India’s natural assets.
India will host the first Global Big Cat Summit in 2026, reinforcing its leadership in wildlife conservation and eco-tourism while enhancing global collaboration and destination visibility.
Institutional reforms include upgrading the National Council for Hotel Management into a National Institute of Hospitality and training 10,000 tourist guides through a hybrid learning programme to improve service quality and visitor experience.
State Government Initiatives
- In May 2026, Andhra Pradesh outlined plans to develop 50,000 classified hotel rooms and establish 10,000 homestays, aimed at strengthening accommodation infrastructure and enhancing visitor experiences. State accelerated tourism infrastructure development through seven anchor tourism hubs and more than 25 tourism circuits, covering destinations such as Visakhapatnam, Araku, Amaravati, Srisailam, Gandikota and Tirupati.
- In May 2026, the Maharashtra government announced plans to develop 100 tourism sub-circuits across the state with an investment of Rs. 2,500 crore (US$ 271.7 million) over the next five years. The initiative aims to strengthen tourism infrastructure, promote heritage, pilgrimage and culinary tourism, and generate employment through balanced regional tourism development.
- In April 2026, the Delhi government announced plans to develop a tourism and cultural hub under the ‘One State: One Global Destination’ initiative with an investment of Rs. 500 crore (US$ 57.5 million). The project, proposed across nearly 200 acres in Kanjhawla, aims to promote tourism, creative arts, literature and local culture while creating a globally competitive tourism destination in the national capital.
- In March 2026, the Gujarat government approved tourism development projects worth Rs. 28.68 crore (US$ 3.12 million) to strengthen spiritual and heritage tourism across the state.
- In January 2026, Thomas Cook India signed an MoU with Gujarat Tourism during the Vibrant Gujarat Summit to strengthen destination promotion and boost leisure and MICE travel. The partnership aims to enhance Gujarat’s tourism visibility through targeted marketing, training initiatives, and an omnichannel strategy to drive higher visitor engagement and arrivals.
- The Budget proposes the development of five tourism destinations across Purvodaya states, Bihar, Jharkhand, West Bengal, Odisha, and Andhra Pradesh, supported by improved connectivity and deployment of 4,000 electric buses to enhance sustainable travel.
- Ongoing initiatives such as Swadesh Darshan 2.0 continue to strengthen tourism infrastructure, with over 75 projects completed nationwide to improve accessibility, amenities, and destination competitiveness.
- Expansion of rail, regional transport, and infrastructure connectivity is expected to improve access to remote destinations, supporting local entrepreneurship and balanced regional tourism growth.
- Telangana's tourism sector attracted Rs. 15,000 crore (US$ 1.69 billion) investments across 31 projects under its new Tourism Policy (2025–2030). Initiatives include developing tourism clusters and positioning Hyderabad as a weekend tourism capital catering to IT professionals' travel demand.
- Andhra Pradesh is expected to announce major tourism investments including a Foreign Direct Investment (FDI) worth Rs. 1,860 crore (US$ 209.77 million), projected to create 12,500 new jobs.
- The strategy of Uttarakhand Tourism is to identify key originating regions and tourist segments, which would then be the focus of marketing campaigns.
- Madhya Pradesh tourism board has opened the door for private investment within the state by providing all the aid and facilities to the investors.
- The AP Tourism Development Corporation (APTDC) plans to establish 100 kiosks across the state in the first phase, providing employment opportunities to the youth.
- In FY25 under the SASCI scheme, Gujarat secured Rs. 99.50 crore (US$ 11.6 million) for an ecotourism destination at Mokarsagar, Porbandar, and Rs. 51.56 crore (US$ 5.9 million) for a tented city and convention centre at Dhordo.
Road Ahead
India’s tourism sector is entering a structurally transformative phase, supported by strong domestic demand, expanding infrastructure, and focused policy interventions. Rising air passenger traffic, growth in intercity mobility, and increasing investment in hospitality assets signal sustained travel momentum across leisure, business, and spiritual segments. Domestic tourism continues to anchor sector stability, while targeted initiatives aim to gradually strengthen inbound travel flows and diversify source markets.
The Union Budget 2026–27 reinforces tourism as a long-term growth engine through destination development, digital integration, and skill enhancement. New initiatives such as Buddhist circuit expansion in the North-East, eco-trails across biodiversity zones, heritage site revitalisation, and the creation of medical tourism hubs are expected to broaden India’s global tourism positioning. Simultaneously, institutional reforms, including the National Institute of Hospitality and large-scale guide training programmes, aim to enhance service quality and workforce competitiveness. Sustainability and regional balance are emerging as central themes in India’s tourism strategy.
Development of destinations in Purvodaya states, deployment of electric buses, and improved rail and regional connectivity reflect a shift towards inclusive and environmentally conscious growth. With increasing private sector participation, digital travel integration, and expanding experiential offerings, India is well-positioned to strengthen its standing as a diversified, resilient, and globally competitive tourism destination over the coming decade.
Note: Conversion rate used in May 2026, Rs. 1 = US$ 0.010482
References: Media Reports, Ministry of Tourism, Press Releases, Department for Promotion of Industry and Internal Trade (DPIIT), Press Information Bureau (PIB), Union Budget 2026-27, India Tourism Data Compendium 2025
FAQs
The tourism industry in India includes heritage, spiritual, medical, wellness, adventure, eco-tourism, cruise, MICE and cultural tourism. Emerging segments such as experiential travel and destination weddings are further diversifying tourism in India.
Tourism in India is driven by destinations such as Delhi, Agra, Jaipur, Goa, Kerala, Jammu & Kashmir, Rajasthan and Varanasi. Emerging destinations including Ayodhya, Rishikesh, Araku Valley and the North-East are also witnessing increasing tourist arrivals.
The tourism and hospitality sector in India contributes significantly through employment generation, foreign exchange earnings and infrastructure development. The tourism industry in India also supports aviation, transport, handicrafts and regional economic growth.
The Government has strengthened tourism in India through initiatives such as Swadesh Darshan 2.0, PRASHAD, Buddhist Circuits, medical tourism hubs, eco-tourism projects and digital heritage infrastructure to improve destination competitiveness.
Medical and wellness tourism has become one of the fastest-growing segments of the tourism industry in India, supported by advanced healthcare, AYUSH services and the development of regional medical tourism hubs.
The tourism industry in India is being shaped by AI-enabled travel planning, luxury hospitality expansion, sustainable tourism, homestays, river cruises, adventure tourism and rising demand for personalised travel experiences.
The future of the tourism industry in India focuses on sustainable destination development, improved connectivity, digital transformation, heritage conservation and greater private investment to strengthen the hospitality sector in India and promote inclusive growth.
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