India's tourism sector is rapidly growing, becoming a major driver of economic growth and investment opportunities. The country's rich culture, history, and natural beauty attract travellers worldwide, and the industry is undergoing a significant transformation. This change is driven by government initiatives, technological advancements, and shifting consumer preferences, making India's tourism landscape ripe for investment.
The travel and tourism spending is expected to grow more than double from $140 billion in 2019 to $406 billion by 2030. Government efforts to enhance tourism infrastructure, such as developing smart cities and improving transportation, is a major factor fuelling this growth.
According to Shaily Gang, Head-Products, Tata Asset Management, “With rising disposable incomes and an expanding middle class, more Indians are spending on travel and leisure. This trend is further boosted by the growing millennial population, who prioritise experiential travel. Domestic tourism forms 99% of the tourism traffic in India.”
Tata Asset Management Company recently launched nation’s first ‘Tata Nifty India Tourism Index Fund’, providing investors with exposure to India’s fastest growing companies from travel, tourism and hospitality businesses. This fund is about domestic tourism which is 99% of the pie while Indians travelling abroad as well as foreign tourists arriving in India is a small piece.
The increasing financial capability of a larger segment of the population presents a significant opportunity for growth in the tourism sector. Budget-friendly, experience-packed leisure destinations with direct flights and relaxed visa norms are becoming increasingly popular among Indian travellers.
India's rich cultural heritage, historical landmarks, and diverse landscapes attract millions of tourists each year. From the majestic Himalayas and pristine beaches to vibrant festivals and iconic monuments, the country offers a wide range of attractions. “This diversity ensures a steady flow of both domestic and international tourists, contributing to the sector's growth and stability,” Gang adds.
India's aviation industry is the ninth-largest civil aviation market and the fastest-growing domestic air market globally. Increased disposable incomes and affordable air travel drive this demand. Gang states, “The industry is expanding its reach by adding new routes to smaller cities, improving air connectivity.”
The tourism sector is also embracing technology, with innovations like AI-driven customer service, online booking platforms, and virtual reality tours enhancing the travel experience and attracting tech-savvy travellers.
