Indian Travelers Are Driving Southeast Asia’s Tourism Recovery

25.08.2023 - 13:14 / skift.com / Southeast Asia

Indian tourists are streaming into Southeast Asia, cementing the world’s most populous country’s position as a key growth market for a travel and tourism sector that is feeling the pinch of China’s slower-than-expected re-opening.

From airlines like IndiGo and Thai Airways to hospitality chains offering thousands of rooms, companies are tapping into India’s burgeoning middle-class and growing spending power, executives and analysts said.

“Southeast Asia is obviously very well positioned for a lot of the growth that is inevitably going to come from India,” aviation analyst Brendan Sobie told an industry conference last month.

The travel and tourism industry is critical for several Southeast Asian economies and contributed about 12% of the region’s gross domestic product before the Covid-19 pandemic. It also employs more than 40 million of the region’s people, according to the Organization for Economic Cooperation and Development.

For a decade or so, the sector was fueled by China but official data from four Southeast Asian countries shows a weak recovery with the number of Chinese visitors in May at least 60% lower than the same month in 2019.

A long-term increase in Indian tourists would lead to a recalibration of airline capacity, hospitality offerings and tourism operators – early signs of which are underway, according to industry members.

India could emerge as the next China “in terms of outbound tourism growth” over the next decade, though connectivity would be constrained by fewer airports there, the Asian Development Bank (ADB) said in a May report.

“India could become the story in the decade after the pandemic for tourism,” it said.

In Thailand, where tourism is an economic mainstay, the number of Indian tourists – though fewer than Chinese in absolute terms – is only about 14% lower than it was in 2019.

In 2019, Chinese visitors spent about $197 a day in Thailand and Indians spent about $180, with both visiting for about a week, according to Thai government data.

Tanes Petsuwan, deputy governor of the Tourism Authority of Thailand said 1.6 million Indians were expected to visit the kingdom this year.

In May, more Indians than Chinese visited Singapore while that same month nearly 63,000 Indians visited Indonesia compared with just over 64,000 Chinese.

“Indian routes are very strong,” said Chai Eamsiri, CEO of Thai Airways, which is flying 14 flights a week to China – down from about 40 before the pandemic – and 70 a week to India.

Some of a possible doubling of Thai’s narrow-body aircraft fleet over the next decade would be deployed to India, Chai said.

Indian budget carrier IndiGo, which has ordered 500 Airbus narrowbody jets to meet regional demand, said it had seen a “strong uptick” in