Ayurveda, palaces, yoga: India's tourism market to add Rs. 5,10,000 crore (US$ 59 billion) by 2028

India’s tourism and hospitality sector is poised for unprecedented growth, with revenues projected to cross Rs. 5,15,483 crore (US$ 59 billion) by 2028, according to Capitalmind PMS. Domestic tourism is emerging as the key driver, expected to double to 5.2 billion visits by 2030 from 2.5 billion in 2024, translating into a 13.4% Compound annual growth rate (CAGR). Domestic visitor spending is projected to nearly triple to Rs. 33,95,000 crore (US$ 388.58 billion) by 2034, supported by improved connectivity through air, road, and rail, alongside investments in tourism infrastructure. Domestic air passenger traffic is forecast to more than double to 693 million by FY30 from 307 million in FY24. The hospitality sector faces a widening demand-supply gap, particularly in the luxury segment, where total revenue per available room (TRevPAR) is 117% higher than upscale hotels and 298% higher than midscale properties. Branded hotels constitute only 11% of total hotel keys, highlighting substantial room for expansion, especially in premium and luxury segments.

Weddings, Meetings, Incentives, Conferences, and Exhibitions (MICE), and food & beverage (F&B) remain significant growth drivers. India hosts around 10 million weddings annually, with the wedding industry valued at Rs. 11,35,810 crore (US$ 130 billion), making it the second largest globally. Destination weddings in Jaipur, Udaipur, Goa, and Delhi generate Rs. 2.18-2.61 crore (US$ 249,513–298,729) per event for luxury hotels. In contrast, F&B revenue per occupied room in luxury properties is 1.9 times the industry average. Corporate travel and office leasing are also boosting demand for business hotels, supported by India’s expanding Global Capability Centers (GCCs) and tech hubs. Infrastructure developments, including 220 new airports planned by 2025, and hotel expansions by chains such as IHCL, Lemon Tree, Radisson, and Mahindra Holidays, are expected to strengthen the tourism ecosystem. Rising disposable incomes, increasing foreign arrivals, and growth in luxury and wellness tourism position India as a globally competitive, high-value destination.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.