Introduction

This article is based on a workshop held in association with PATA to provide professionals with deeper understanding of the Indian outbound travel market. The increasingly affluent middle-class, together with a consumption-driven economy, increase in the number of business travelers and the ongoing liberalization of air transport has contributed to the dynamic growth of outbound travelers to Asia-Pacific. The maturing Indian travel market is looking beyond the traditional Western destinations and prefers for Asian destinations.

Original Article

Essay by Rahul Wadhwa
Master in Tourism Destination Management student 2008/2009

India is a country of continental dimensions with a fascinating kaleidoscope of diverse languages, religions, customs and traditions and it has been ranked as one of the fastest growing travel and tourism economies in the world both for inbound and outbound travel. The increase in disposable income, the fast economic growth and the rapid expansion of low cost airlines in India are just some of the many factors leading to the boom in outbound tourism in India.

Accounting for 72 percent of the most recent leisure trips and 63 percent of business trips, Asia is the most popular destination for Indians when heading overseas. Other regions such as Europe attract a greater percentage (18%) of Indians travelers for business rather than pleasure (14%)

PATA President & CEO Peter de Jong said, “With India being one of the fastest growing markets in our region, the eyes of the travel industry are turning to this country of 1.1 billion residents, and its rapidly expanding middle class.”

The size of the Indian middle class currently stands at somewhere over 350 million – roughly the size of the population of the US – and is growing at an estimated 40-50 million a year. It is estimated that more than half of these people are less than 35 years old, for whom travel is an exciting proposition. With the GDP in the country growing by 8% per annum, disposable incomes have increased rapidly. Indian outbound travelers, once considered low spenders, are now recognized as high-yield visitors.

According to PATA, between 1996 and 2006, the Indian outbound market expanded by nearly 10 percent annually, with the number of trips taken by Indian travelers growing from 3.5 million in 1996 to 8.3 million during that time. Close to three million arrivals were to Asia Pacific destinations, making India the region’s fourth largest source market behind China, Japan and Korea. The top five destinations by percentage growth to 2009 will be Macau, Papua New Guinea, China, Cambodia and Malaysia.

Though one of the main attractions of the outbound travel market is that Indians are very big spenders (owing to a growing economy post liberalisation), other reasons that are blowing in the winds of change in travel and tourism industry can be attributed to liberalization of air transport, fluency in English and comfort level with international travel, greater segmentation in the market and a strong demand for travel among families, young people, women and seniors.