India Becoming the New China for Outbound Travel

25.08.2023 - 14:38 / skift.com / Peden Doma Bhutia

China’s latest loosening of its stringent zero-Covid policy, mostly for domestic tourism, comes across as too little too late, at a time when the rest of the world is living with the virus. 

Chinese tourists have said that they are still skeptical of international travel even if borders are reopened, according to a recent survey. 

The time is ripe for India — which already ticks most of the boxes as a suitable candidate to take over from China as the largest travel source market — to enter the dragon’s space. 

A recent United Nations population report has also said that India is projected to surpass China as the world’s most-populous nation in 2023.

In 2019, China was the largest outbound travel market in the world with Chinese tourists taking 150 million trips overseas per year while spending $255 billion, according to Skift Research’s State of Travel Report.

Highlighting the uneven recovery path of the Chinese travel industry, a McKinsey report in August stated that outbound travel is likely to remain muted for 12 to 18 months.

Destinations trying to revive their tourism-dependent economies are also looking to reduce their dependence on China and identify new source markets, India is clearly a frontrunner in this reordering of travel.

An earlier Skift article had also highlighted that while much of the post-crisis tourism recovery conversation has focused on China, India should not be neglected.

OAG, an aviation data analysis firm, said India has outperformed other Asia-Pacific countries with a faster rebound and is expected to become the new China over the next five years.

While he is sure that once China opens up tourism will bounce back — MakeMyTrip co-founder and Group CEO, Rajesh Magow, in an earlier interview with Skift had called this a short-term opportunity for India.

Between 2009 and 2019 outbound tourism from India increased 143 percent from 11 million travelers to 27 million.

Projections show a full recovery for the Indian outbound market in 2024 with outbound travelers reaching 28.5 million in 2025.

China was the largest source market for Thailand in 2019 as Chinese tourists accounted for 28 percent of arrivals into the destination. Between January and August 2022 Chinese tourists accounted for only 3 percent of the inbound traffic.

India’s large population and the availability of direct flights from many Indian cities to Thailand makes Isada Saovaros, director of the Tourism Authority of Thailand’s Mumbai office, hopeful about the country’s potential to replace China as the largest source market.

“Thailand has projected the number of Indian arrivals will rise to one million by the year end. India could soon move from being the second largest source market to rank first,” said Saovaros.