Indian travelers are big spenders but only 1% go abroad

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The famous Gateway of India monument in Mumbai, India was built in the 20th century to commemorate the visit of King George V and Queen Mary. It is located on the shores of the Apollo Bunder area in south Mumbai and is the main tourist spot in the city.

Darren Robb | Image Bank | Getty Images

India’s travel landscape is changing as the country emerges as a powerhouse in the tourism sector.

They are willing to spend a lot while traveling, but research shows that most Indians travel at home – not abroad.

Indian travelers took 1.7 billion leisure trips in 2022 but most never left the country, and only about 1% traveled abroad, according to and McKinsey.

Indian travelers are expected to take 5 billion leisure trips by 2030, of which 99% will also be domestic, said the report released in October.

The world’s most populous country is expected to become the fourth largest global travel spender by 2030, largely due to a growing middle-income population that sees future -into a home growing $35,000 per year by then.

In addition, the population is young, with the median age at 27.6, “more than a decade younger than most major economies,” McKinsey said on its website. “Furthermore, consumption of goods and services, including recreation and leisure, is expected to double by 2030.”

Spending on travel and tourism is expected to hit $410 billion — an increase of more than 170% from $150 billion in 2019, the report showed.

Here are the 10 best places for Indians traveling in their own country, according to and McKinsey.

  1. New Delhi
  2. Bengaluru
  3. Mumbai
  4. Chennai
  5. Pound
  6. Hyderabad
  7. Gurugram
  8. Jaipur
  9. Kochi
  10. Kolkata

According to the report “How India travels 2023”, about 2,000 Indians and 42,000 global tourists between the ages of 18 and 000 have booked leisure trips in 2022 and expect the same thing to do this year.

New Delhi, Bengaluru, Mumbai and Chennai retained the top four spots from the last survey in 2015 – Kochi being the only new city on the list.

“India’s travel ecosystem is maturing and there are several government schemes that are making the country more connected and ensuring that it develops into a tourism hub,” said Kanika Kalra, com -managing partner at McKinsey Mumbai, to CNBC.

Smaller cities are gaining traction

The 10 most visited cities are crowded destinations, but that could soon change.

More and more Indians are now looking to find smaller urban spaces including those in Tier 2 or Tier 3 cities, Kalra said, adding that a Tier 2 city is a it is Kochi.

Tier 2 cities in India are those with a population between 50,000 and 100,000, while those between 20,000 and 50,000 are classified as Tier 3 cities, according to India’s press release.

Tourists buy clothes at a local street market in Jodhpur, India, on November 22, 2022.

Mayur Kakade | Minute | Getty Images

Apart from cosmopolitan cities like New Delhi and Mumbai, those like Jodhpur, Dharamshala, Bodhgaya, Bilaspur, Kodagu and Raipur are also attracting the attention of international hotel chains looking to carve out market share. ​in India’s thriving travel industry.

“Brand hotels are currently targeting Tier 2 cities for expansion due to the growing business opportunities and increased willingness of travelers to pay for standard services,” said Deepak Rao. , director of revenue management at Hyatt Hotels in India and Southwest Asia, in the report.

French hotel chain Novotel opened its doors to travelers in Jodhpur in May, and Radisson Hotel Group announced in June that it will begin welcoming visitors to Raipur in 2025.

Around half (52%) of hotels in Tier 2 and Tier 3 cities will be branded hotels by the end of 2023 – up from 27% in 2015, the report showed.

India on track to become global aviation powerhouse, says Air India CEO

Growing interest in traveling to Indian villages is largely due to the ongoing transport infrastructure upgrade, said Kalra Mckinsey.

At its annual budget announcement in February, India’s finance ministry said it plans to pump capital spending by 33% to 10 trillion rupees ($120.96 billion), as the country becomes the second largest economy. by 2075.

Indian airlines have ordered more than 1,000 new aircraft, which will bring the total number of aircraft to between 1,500 and 1,700 by 2030, the report showed.

“So we will see this landscape change dramatically and we will see a new wave of travelers to smaller towns,” Kalra said.

Major international destinations

Of the 1% of Indian travelers going abroad, here are the top 10 places they visit.

  1. Dubai
  2. Bangkok
  3. Singapore
  4. London
  5. Paris
  6. Ho Chi Minh City
  7. Ubud
  8. Hanoi
  9. Phuket
  10. Kathmandu
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