Tourism and Hospitality Industry in India: Growth & Outlook

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 approximately 10.07 lakh foreign tourist arrivals in January 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.
• India’s branded hotel segment is expected to add nearly 20,000 new rooms over FY26–FY27, reflecting a 20% increase in supply driven largely by asset-light expansion strategies. Despite rising inventory, occupancies are projected to remain stable, and average room rates are likely to increase as travel demand continues to outpace supply across key destinations.
• Hotel transactions in India reached Rs. 3,587 crore (US$ 397 million) in 2025, rising from Rs. 3,074 crore (US$ 340 million) in the previous year, reflecting strong momentum in business and leisure travel demand. The growth highlights increasing investor confidence, with strategic acquisitions and fresh capital expected to drive further expansion in the hospitality sector.
• During April–September 2025, India’s intercity private bus market carried around 140.15 million passengers, reflecting strong travel demand and large-scale mobility across the country. With an average 76% occupancy rate, the data highlights robust utilisation levels, indicating steady growth in leisure, business, and regional tourism travel supported by private bus operators.
• 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 FY26 has allocated Rs. 2,541.06 crore (US$ 291.07 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 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.
• In February 2024, Mahindra Holidays & Resorts India Ltd (MHRIL) intends to invest around Rs. 4,500 crore (US$ 541.6 million) over the next three to four years, aiming to double its room capacity to 10,000.
• In February 2024, Oberoi Realty, a real estate developer, has partnered with Marriott International, a global hospitality leader, to develop two Marriott properties in Mumbai.
• In February 2024, OYO announced its venture into sports hospitality, selecting 100 hotels across 12 cities like Delhi, Chennai, and Bangalore. The focus is on catering to large sports events by providing accommodation and services for athletes and officials.
• In February 2024, the Radisson Hotel Group announced its rapid expansion in India, securing agreements for 21 hotels across nine distinct brands in 2023.
• In February 2024, Lemon Tree Hotels intends to launch 30 new properties across the country this year, potentially increasing its room capacity by over 2,000 rooms. The hospitality chain is optimistic about the demand driven by middle-class consumers.