Skift Take

Record aircraft orders show investor faith in the potential of India’s outbound tourism. The smartest destinations will warmly welcome to the rising wave of Indian travelers. Easing visas is one key step (hint, hint).

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India generated Asia’s highest outbound travel volume for the first time in 2022, with foreign trips exceeding those of China, South Korea, and Japan, as per tourism consultancy and research firm IPK International’s World Travel Monitor findings. An earlier Skift report had mentioned that the time is ripe for India — which already ticks most of the boxes as a suitable candidate to take over from China as the largest travel source market. With around 10 million foreign trips, the country registered a 190 percent year-on-year rise in outbound travel last year — which is significantly higher than the average global increase of 90 percent. India’s favorite travel destination in 2022 was Dubai, followed by the U.S., Thailand, Saudi Arabia, and Singapore. Overall, around 70 percent of Indian travelers undertook trips in Asia, which increased by more than 250 percent compared with the previous year’s figures. According to IPK’s Destination Performance Index, Thailand, Abu Dhabi, and Dubai were India’s preferred travel destinations in 2022 — based on travel satisfaction, recommendations, and the desire to revisit a destination. Among trip types, round trips ranked first with a market share of around 30 percent, followed by city breaks at 26 percent and sun and beach holidays at around 20 percent. Business trips comprised about a quarter of foreign travel, with meetings, incentives, conferences, and exhibitions market accounting for over 70 percent of business travel in India.

Looking to strengthen its hotel business, online travel agency Cleartrip has launched luxury travel experiences Premium Getaways. Right from the amenities to locations, all the properties under Premium Getaways are selected based on comprehensive market research and insights from Cleartrip’s large user base, a release from the company stated. Currently, the service has been introduced in partnership with over 40 hotels across over 25 destinations, including Manali, Coorg, Jaipur, and Munnar. “In the post-pandemic world, luxury travel emerged as a key aspiration for travelers across the board,” said Manu Sasidharan, head of hotels and accommodation at Cleartrip. 

India is pressing the UK government to ease visa rules for skilled professionals employed by Indian companies investing in Britain as negotiations for a free trade agreement between the two nations continue. The move is in addition to India’s longstanding pitch for more visas for Indian workers, although this has so far met with reluctance from the UK government. Indian companies are the second biggest foreign investors in the UK, data shows, and India is hoping to secure hiring flexibility for its businesses. The potential introduction of a carbon tax on steel imports, rules of origin issues, and longer-term work options for Indian students in the UK are also likely to be discussed during weeklong talks that started between Indian and UK officials earlier this week.

The Indian hotel industry is set to report a 13-15 percent revenue growth in financial year 2024, despite the potential demand impacts from further Covid waves, according to credit rating agency ICRA. The demand recovery has been robust over the past year. It’s expected to continue, driven by domestic leisure travel, higher bookings from meetings, incentives, conferences, and exhibitions, and business travel, along with an increase in foreign tourist arrivals. ICRA estimates premium hotel occupancy in India to reach 70-72 percent, with average room rates at premium hotels expected at $73-75 in the financial year 2024. The rating agency also mentioned that demand in leisure destinations has been strong since the third quarter of 2022 financial year, while markets like Chennai and Hyderabad have benefitted in the 2023 financial year from meetings, incentives, conferences, and exhibitions (including weddings) and pick-up in business travel. 

U.S. aircraft maker Boeing has detected several issues with the manufacturing of 737 Max planes which could affect the deliveries required for the fleet expansion of Indian airlines like Air India and Akasa Air, according to reports. The development came after Boeing discovered that a supplier used a “non-standard manufacturing process” during the installation of the rear fuselage. Boeing has assured that the 737 Max planes are still fit for flying, but the discovery of manufacturing issues will likely delay deliveries. In February, Tata-owned Air India announced that it would purchase 190 737 Max to boost its domestic and international network. India’s newest airline Akasa Air also has a pending order of around 72 737 Max aircraft with the company. 

The Indian Heritage Hotels Association — which aims to promote heritage tourism by preserving and reviving heritage hotels — has pitched for creating a district-wise inventory of old bungalows, mansions, palaces, and forts to promote heritage tourism, said Randhir Vikram Singh, the president of the association. Singh said this has to be done in partnership with all stakeholders and government agencies. “The heritage hotels in India are also a testament to the country’s architectural brilliance, showcasing a unique blend of architectural styles, Indian and European, Mughal and Rajput,” Singh had said in his address at the G20 Tourism Expo, held in the north Indian state of Rajasthan, which also houses about 75 percent of heritage hotels in the country.

Indian hospitality company ITC Hotel Group’s Fortune Hotels has announced the signing of an operating agreement for a hotel in the hill station of Khajjiar in the north Indian state of Himachal Pradesh. The existing property has been undergoing a renovation program and is set to open doors in the first quarter of 2024. The company, in an earlier release, had talked about its ambitions to expand its reach in tier-2 and tier-3 cities with its upscale to mid-market service offering for business and leisure travelers. The hotel chain also mentioned that it had closely studied the growth and development of non-metros and spotted opportunities for the future.

Tata Group-owned Air India has added more flights to Dubai from the Indian cities of Delhi and Mumbai, as part of the network alignment process between Air India and Air India Express, it said in a statement. Air India will operate up to 10 daily flights between Delhi and Dubai, including a new flight that starts on April 29. Between Mumbai and Dubai, Air India now operates up to 6 daily flights, resulting in eight flights each day to Dubai from the two cities. The airline has also deployed its twin-aisle Boeing 787-8 Dreamliner aircraft on most daily flights to Dubai from Delhi and Mumbai. Airbus A320/321 aircraft will operate the remaining flights. Middle Eastern carriers have also been seeking additional capacity to serve more routes in India. However, Jyotiraditya Scindia, the Indian civil aviation minister, had earlier said that the country has no plans to increase air traffic rights for the United Arab Emirates. He instead urged domestic carriers to fly long haul and help establish new hubs.

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Tags: air india, akasa air, Boeing, boeing 737 max, cleartrip, heritage, hotels, india, india outbound, itc hotels, occupancy, skift india report, UK government, visas

Photo credit: An Indian tourist in Singapore, one of the top travel destinations for Indians in 2022. Source: Danon/Adobe Stock Image Danon / Adobe Stock Image

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