India has all the cards to become the next mega source market for international travel, although major barriers still need to be overcome. The country has been performing extremely well in our Skift Travel Health Index.
The global score of the Skift Travel Health Index remained stable at 97, as per our latest March 2023 update. This is unchanged from the previous month.
The latest March 2023 Highlights report shows that hotels and vacation rentals witnessed a slight decline over the last month but the car rental sector improved 3 percentage points month-on-month, thus stabilizing the index. We feel that the industry needs a push to achieve the last leg of recovery.
In the U.S. and Europe, however, there are growing signs that inflation is set to impact travel demand. Skift Research’s multi-country survey for business travelers shows that respondents in the U.S., UK, and Australia are pessimistic about the economic conditions in the country and feel that it will have an impact on travel. They reported that companies have started or are expected to start scaling back business trips.
India’s Growth Potential on the Global Stage
Asia Pacific, and especially India, is a different case. Projected to surpass China as the most populous country in 2023, India is expected to become the new China in the next five years. Since mid-2021, travel performance in India has been the driving force for Asia Pacific’s travel recovery.
Although domestic demand spearheaded travel recovery in India, international demand has now caught up, both being above 2019 levels.
OTA Insight data shows that hotel published rates in India have grown on average 35-40% above 2019 levels in the last year.
While there is talk of the slowing down of the economy, Indians remain optimistic. Skift Research’s survey had 94% of Indians responding that they expect business travel spending to increase in 2023 and around 74% of respondents expect an increase in personal spending on leisure travel this year.
More analysis can be found in our March 2023 Highlights report and on our Skift Travel Health Index data dashboard.
Skift India Report
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