Domestic tourism has been a major growth driver for many countries and often accounts for over 70% of travel and tourisms contribution to GDP. With India, the figure shoots way higher to an exceptional 90%. The expansion of the domestic tourism sector, as a result, directly stimulates the job market by creating more opportunities. This, in turn, has also given a massive boost to the hotel and hospitality sector and other ancillary industries, catalysing and generating employment for many.
The contribution of domestic tourism to the larger economy and in creating and expanding job opportunities has largely remained unnoticed and unsung. While most of the focus revolves around international tourism and foreign travellers, as it generates revenue through exports, the World Travel & Tourism Councils (WTTC) annual economic impact data speaks a different story. According to this data, domestic tourism represented 73% of the global tourism spend in 2017 and leads the tourism space.
Domestic tourism has been growing at rapid rates over the last few years. From 220 million domestic tourist visits in 2000, the numbers have catapulted to a staggering 1.82 billion in 2018, a growth of over nine times in two decades. The major trigger in this area was religious tourism that included trips made to pilgrimages or religious places, a trend that remains unique to the Indian culture and ethos.
Undoubtedly, a foreign tourist spends more money than a domestic tourist but the massive volume of the domestic tourists makes up for the lesser amount, hence contributing enormously. While the foreign tourists increased by only a quarter from 20 million to 25 million during 2011-2016, the number of domestic tourists almost doubled from 865 million to 1.61 billion.
Factors influencing domestic tourism in India
Domestic tourism is rising more than ever before, with more Indians travelling within the country, driven by multiple factors such as religious tourism or the urge to explore the unexplored places among all age groups. Moreover, with the drastic reduction in outdated legislation, domestic air travel grew nearly 20% in 2017. Also, with the advent of five new regional budget airlines servicing over 100 routes, thousands of families have been encouraged to take flights for the first time, thus giving a much needed boost to the travel and hospitality space at large. This not just helped in promoting domestic tourism, but also opened up job opportunities galore as hotels and resorts develop across far-flung parts of the country
Tier II and Tier III cities-The new growth engines for the Indian tourism
While metro cities have always been the most preferred destinations for Indians domestically, its the tier-II and tier-III cities that are increasingly catching up to become the first choice for domestic as well as international tourists. With proper access to basic facilities, availability of land, skilled and more affordable manpower, these cities possess many advantages over metropolitan cities. In fact, a recent report by an industry leader states that around 60% of growth in terms of total passengers who travelled in 2018 came from tier-II and tier-III cities. Not just that, renowned international and domestic hospitality brands are foraying into these cities and transporting them into tourism hubs, thereby creating an entire pipeline of opportunities for future employment. With the introduction of the Regional Connectivity Scheme by the government, the chances of Tier-II & III cities, as emerging destinations have further paced up.
Tapping into the promising potential of domestic tourism, the government leveraging its ability to generate employment, eliminate poverty, upgrade infrastructure, and increase economic growth. This was evident in the Prime Ministers Independence Day speech, where he asked people to travel to at least 15 tourist destinations within India by 2022 in a bid to energise domestic tourism.
Despite Indias rich cultural heritage, historical monuments, exotic cuisines and different civilizations, the domestic tourism sector remains largely unexplored. The reasons range from safety and security issues, low infrastructure and chaotic road networks to busy rail systems and ironing out these creases would call for huge investment and fitting public-private collaborations. If these challenges could be well addressed, the astounding growth being witnessed in the domestic tourism space can be amplified further so as to pave the way for a brighter, better future for millions of Indians.
Written by Mr Sunil Ghadiok-Director, Shanti Hospitality Management Services.