India’s accommodation sector remains upbeat about its economic development, despite a sluggish inbound travel recovery. The sector has been reporting rising room and occupancy rates over the past six months.
This is according to a Booking.com Indian Accommodation Barometer 2023 report, released in collaboration with business intelligence firm Statista. Some 250 executives and managers participated in the survey conducted between July and August this year.
- The report highlights the growing confidence across the travel accommodation sector, with nearly 50% of hoteliers feeling “positive” about their current economic development and future prospects.
- Business sentiment among Indian accommodation providers continues to remain strong, with nearly half (49%) reporting an increase in average room rates and an even higher number (55%) reporting an increase in occupancy rates over the past six months.
Hotel Booking Trends: Indian hoteliers surveyed said that more than two-thirds of guests (67%) are booking shorter stays, closely followed by 66% booking further in advance.
Some 63% of customers prefer to book less expensive rooms, and 60% opt for more restrictive cancellation policies to save money. Over half (52%) of the respondents stated that guests spend less on extras, and 42% avoid peak-season stays.
2024 Hotel Sector Opportunities: 88% of hoteliers surveyed see attracting international tourists as one of the biggest business opportunities for the year ahead.
Attracting families (78%), offering local experiences (72%), attracting more domestic travelers (72%), and spiritual tourism (64%) are the other leading opportunities Indian hoteliers are excited about going forward.
Gastronomical Experiences are essential to the industry’s profit margins, with 39% of accommodation providers claiming food and beverages significantly contribute to business.
Cost Challenges: The Indian accommodation industry is concerned about operating costs. For them, the top two challenges were the cost of energy (74%) and taxation (73%).
Investing in Green Business Practices: 62% of Indian hotel owners believe that financial and tax benefits for sustainable business practices are crucial in helping the hospitality industry become environmentally friendly.
- Accommodation providers say they are investing in different sustainability categories: energy efficiency tops the list (46%), followed by waste reduction (45%) and water preservation (26%).
- 24% reveal that they support local economies by sourcing their products and services locally.
Indian Travelers Become Third-Largest Source Market to Singapore
In October, Singapore welcomed 94,332 Indian tourists, which was an increase from 81,014 in the previous month. The country’s tourism board confirmed India is now Singapore’s third-largest source of tourists, surpassing Malaysia and Australia.
Chinese travel to Singapore is ahead of India, with 122,764 visitors in October, dropping from 135,677 in September.
Traditionally known as a prime travel destination for Indian families and groups, Singapore has now been trying to position itself as a destination for single female travelers. Singapore’s tourism development agency — the Singapore Tourism Board — in collaboration with Delhi-based travel community platform Tripoto launched a web-series earlier this year in India to showcase how Singapore’s range of experiential offerings perfectly caters to solo female travelers.
Tourism in India Shows Resilience
India is expected to reach 2019 levels of tourist arrivals in the fourth quarter of 2023, according to a new report by travel intelligence firm ForwardKeys. The report further stated that despite challenges in the travel industry, India stands out as one of the most resilient countries in the Asia Pacific region.
The report’s data shows India experienced only a 1% decline in tourist arrivals. While it didn’t explicitly mention the factors contributing to India’s resilience, the following factors undoubtably have influenced it:
The report indicated that while the industry’s revival varies among countries, South Asia stands out as the most recovered sub-region, experiencing only a 5% decline in the fourth quarter. This positive trend is supported by a robust restoration of international seat capacity, expected to surpass 2019 levels by 4%.
However, despite this overall optimistic trajectory, air connectivity remains a formidable challenge for the Asia Pacific travel industry. The pandemic-induced reduction in flight frequencies and escalated airfares continues to impact the region. Travel to and within the area remains more costly and time-consuming than pre-pandemic times, posing obstacles to the region’s complete recovery.
Domestic Air Traffic Reaches New High
The number of passengers flying within India is steadily increasing, and on Monday, airlines transported 459,526 passengers, a new high for the sector. The recovery of India’s domestic air travel “has been impressive and encouraging”, according to the civil aviation ministry.
The total flight movements on Monday stood at 5,958. In the corresponding period last year, the number of domestic air passengers was just over 394,000 and the number of flight movements was 5,468.
On Saturday, tairlines transported 456,748 passengers, while on Sunday, the domestic air traffic was 456,910.
Trivia: India is one of the fastest-growing civil aviation markets in the world and domestic air passenger traffic registered an annual growth of nearly 11% to 12.6 million in October.
Uttarkhands Amps up to Welcome More Tourists
Due to a significant increase in people travelling within the country, the Uttarakhand Tourism Development Board expects the number of tourists coming to the state to go up from 39.2 million in 2018-19 to 74 million by the end of the fiscal year 2024, according to a Mint report.
- Uttarakhand also expects to attract investments in tourism and initiate 70 public-private partnership projects by 2030.
- At present, tourism contributes 4.4% to the state’s gross state domestic product, around INR 140 billion ($1.7 billion).
- It is expected to grow by 12-15% annually in the coming years, Sachin Kurve, secretary, of tourism, and chief executive of the board, told in the report.
Other Developments: The state received substantial support and investment from private businesses, often in a gradual and unplanned manner. Notably, it obtained $124 million from the Asian Development Bank to improve its sports tourism facilities. Some of this money is currently being used to develop paragliding and other sites in the state.
While Uttarakhand is known for religious tourism, primarily the Char Dham yatra — a tour to the four sacred sites of Yamunotri, Gangotri, Kedarnath, and Badrinath, nestled in the Himalayas, the tourism development board is expanding its efforts by starting new projects like the Tehri Acro Festival to be held from November 24-28.
The event will be the nation’s first international aerial acrobatic show spanning five days, with the participation of 150 paragliders, including international athletes, in the Tehri region of the state.
Strong Recovery in Cards: The World Tourism and Travel Council (WTTC) predicts a solid comeback for Indian tourism this year, adding around INR16.5 trillion ($198 billion) to the economy, just 3.5% below 2019 levels.
Kerala’s Responsible Tourism Mission Makes it to UNWTO List
The Responsible Tourism Mission under Kerala Tourism has entered the Global List of Case Studies of the United Nations World Tourism Organization (UNWTO).
The UNWTO mentioned that Kerala Tourism has successfully supported the Sustainable Development Goals (SDGs) while promoting the travel industry in the state.
Kerala is recognized for using local resources and products to enhance Responsible Tourism destinations, aligning with its goals to achieve the SDGs.
Kerala’s Responsible Tourism Mission earned the place among seven G20 countries with Maharashtra being the only other Indian state to figure in the list.
Kerala recently held its first-ever Tourism Investors Meet, and the state received investment offers totaling INR 150 billion ($1.8 billion).