By 2020, the government of India expects travel and tourism to contribute Rs. 8,500 billion to GDP, almost four times the value in 2005. With successive governments committed to reform, a strong manufacturing sector and a private sector that already has a critical mass that is needed to drive growth, it is unlikely that the strong growth in GDP is likely to be reversed. The rising middle class is also becoming increasingly affluent, mobile, Internet savvy and more sophisticated in terms of what is demanded in terms of tourism products and services, and more importantly the price they are willing to pay for it.
A boom is expected in travel accommodation, as more serviced apartments, budget hotels (2-star category) and highway motels are established.
Significant changes are expected in travel retail, with the arrival of more international players, such as Le Passage and Cox & Kings, particularly in outbound travel. British company Cox & Kings plans to relocate its corporate headquarters from London to Mumbai as a result of its being bought out by its Indian arm in late 2005. Global interest also includes the American millionaire Alfred Ford with plans to set up a Himalayan ski resort. Internet intermediaries are expected to expand significantly and grow the market without significantly adding to volume growth. Rural tourism and medical tourism for inbound tourists will also give rise to new products and services in this sector.
Until recently, not much emphasis had been given to the maintenance and development of the historical and heritage sites in India, which resulted in a large number of tourists staying away from these. However, the Indian government’s increasing investment in the upgrading and modernisation of infrastructure will translate into better facilities, amenities and access to the leading tourist attractions and sites.
