DRMumbai: India received over 10 million international tourists (excluding NRIs) in 2017, but how many of them travelled for leisure? The latest edition of The Ultimate Indian Travel & Hospitality Report released by Hotelivate, the new-age hospitality consulting firm offering specialised services to clients across the Asia Pacific region, finds that only 2.5-3 million tourists visit India each year for the purpose of a holiday, with the USA and UK contributing a major chunk of the total.
Hotelivate’s The Ultimate Indian Travel & Hospitality Report 2019 suggests that leisure travel to India has huge potential and the country is just scratching the surface at the moment
For a country this size, which has rich and diverse tourist offerings, the figure is dismally low. To offer some perspective, Thailand received 35 million tourists, predominantly in the leisure segment, in 2017 and Singapore, a city-state, received around 17 million inbound tourists that year. India’s focus on leisure tourism can be better understood when one considers its economic benefits.
Leisure travellers usually have longer durations of stay. They also tend to access more facilities and services related to accommodation, food, transportation and recreational activities and engage more with the local community than business travellers; thus, resulting in a wider induced economic impact. Hotelivate collaborated with The World Travel & Tourism Council (WTTC), World Travel & Tourism Council India Initiative (WTTCII), Centre for Asia Pacific Aviation (CAPA) India, Indian Railway Catering and Tourism Corporation (IRCTC), Ministry of Railways, several branded hotel chains and select online travel agencies in the country.
Research Recommendations
- Capture a larger share of outbound leisure traffic from mature source markets than investing scarce resources in emerging source markets.
In comparison to its peer set in the Asia Pacific, India has a low market share even in its top 10 source markets. At an individual market level, India’s share of outbound traffic from its 10 largest source markets ranges from 0.3 per cent in Germany and China to 3.7 per cent in the USA. The country’s low market share has declined further in recent years for outbound travel from Sri Lanka, China, the UK, France, Japan and Canada even as China’s share in these markets has been growing.
- Participate more in the Chinese outbound travel phenomenon.
China leads the world in terms of international outbound travellers as well as international tourism spend. However, India currently receives fewer Chinese visitors than even Sri Lanka and Maldives (that are way smaller), despite being a similar length of haul from China.
- Make reaching India easier and more cost-effective for tourists.
Around 98 per cent of leisure tourists arrive into India by air, and so direct connectivity and availability of seats is paramount. At present, for most of the priority markets for leisure tourism to India, the majority of traffic still flows through an intermediate hub, especially from long-haul markets like the USA, Canada and Australia.
- Establish greater connectivity to develop short-haul leisure markets.
Around 61 per cent of India’s foreign tourists are from long-haul destinations (more than six hours). This is in clear contrast to leading tourist destinations in the world, like France, Spain, USA, China and Italy, which receive their largest share of visitor traffic from their neighbours (short-and medium-haul markets –under three hours and between three-to-six hours, respectively). Distance makes travel to India not only more expensive, but also less suitable for short, spontaneous breaks. Also, India ends up competing with a greater number of destinations of a similar haul and cost.
- International expansion by Indian carriers.
While the primary focus of home-based airlines is to increase point-to-point traffic, as the networks of these airlines increase, there will be more connecting traffic via India (e.g. between London and Sydney), creating more incremental visits and encouraging transiting passengers to return in the future.
- Increase government spending on tourism as a percentage of its GDP.
In 2017, the Indian government’s collective travel and tourism spending as a share of its GDP was just 0.1 per cent despite the sector’s total contribution to GDP of 9.4 per cent. Comparing this statistic to that of peer countries, one can see that India ranks the lowest.
- India needs to attract a higher share of millennial leisure travellers.
While India has a backpacker market, it needs to reorient itself to promote high value youth leisure tourism. Youth travel is one of the fastest growing and most dynamic markets of global tourism. According to UNWTO’s 2016 report on youth travel, young travellers spend more of their budget in local communities, have longer durations of stay, are a great source of word-of-mouth marketing (especially via social media) and tend to be more resilient to economic problems.
- Effective destination marketing and promotion.
The Incredible India campaign needs to develop continually with vigour, and ways to gauge its true effectiveness need to be determined. Moreover, states must align their tourism marketing and promotion with the national campaign.
- A well-defined tourism policy/strategy document.
Other leading tourist destinations studied by CAPA have a well-defined tourism policy focussing on overseas promotion, government and industry collaboration, infrastructure improvements and reduced regulations. These countries do not govern tourism as a separate ministry; rather, they manage it as a department under the ministry responsible for trade development. The department is supported by advisory boards and an inter-ministerial group to aid collaboration between the tourism department, other government offices and the industry.
The Report observes that leisure travel to India has huge potential (be it pure leisure or “bleisure” that combines business with leisure), and the country is just scratching the surface at the moment. To this extent, the tourism industry (including hotels) needs to collectively plan and commit resources to attract leisure tourists to the country. The diversity of India’s leisure offerings should be better communicated, and the subsequent growth of this segment should be adequately supported and sustained. We must aim at making India a “must-visit and easy-to-discover” destination!
