Skift India Summit 2024: Trends Driving the Travel Boom

01.03.2024 - 16:21 / skift.com

On March 19, the Skift India Summit kicks off. As a research analyst deeply embedded in the Indian travel industry, I am excited to learn more about the trends shaping India’s tourism boom.

Here’s what I’m focused on:

The rising middle class: The expansion of India’s middle class is a pivotal force propelling the country’s tourism growth. With a growth rate of 6% annually, this demographic represents 31% of the population and is projected to reach 60% by 2047. 

This young and dynamic segment, with 65% under 35 years old, contributes about 50% of the nation’s total income. It creates a robust demand for travel services driven by rising incomes and evolving lifestyles.

The digital revolution: Apps like MakeMyTrip, Booking.com, and TripAdvisor have transformed travel planning and experiences. The introduction of budget-friendly and flexible payment options, such as ‘travel now, pay later’ schemes, is making international travel more accessible, particularly for the middle-class travelers.

These companies are strategically focusing on cultural touchpoints, with the influence of movies extending into travel aspirations, and Indian celebrities becoming brand ambassadors for various destinations.

More travel options: Unique travel trends are reshaping the industry, with a noticeable shift towards experiential travel, eco-tourism, and offbeat destinations. This growth of travel options makes the industry more inclusive and appealing to a wider audience. Global collaboration and partnerships within the travel industry, as Indian companies form alliances with international counterparts, contribute to the development of a robust travel ecosystem, enhancing the global reputation of Indian tourism.

Despite the remarkable growth, India’s tourism sector faces significant challenges. Infrastructure constraints are a major concern, with a substantial gap in aviation markets compared to China, despite India surpassing China as the world’s most populous country. While India boasts the world’s third-largest aviation market, China’s fleet is almost five times larger, highlighting the need for investment.

Price sensitivity is another crucial obstacle. According to a Skift Research survey, 13% of Indian travelers cited high prices as a deterrent for international travel in the next 12 months, and 20% mentioned financial constraints. India’s average expenditure per outbound trip has improved but still lags China. 

In 2019, China spent $1,646 per outbound trip, while India spent $1,062. Closing this expenditure gap is vital for India to strengthen its position in the global outbound tourism market.

According to our in-house survey of Indian travelers, Indian travelers exhibit a diverse range of priorities and concerns when