Travel sector recovery faces new risks.
Posted on May 20, 2022 by Ghoomophiro
India’s travel and tourism sector is finally bouncing back after two years of tepid business during the Covid-19 pandemic. Travel and hospitality companies are now betting big on the ongoing summer season, a critical period for holidaymakers. They are also keeping an eye out on concerning rise in airfares and the possibility of yet another Covid-19 wave.
For now, Covid-19 restrictions have been relaxed, and the demand and booking inquiries are increasing.
“We have witnessed domestic passenger traffic reaching 86.3 percent in March compared to the pre-Covid levels of February 2020. A major trend is a strong surge in flight and hotel bookings due to the peak summer holiday season, primarily driven by school vacations,” Dhruv Shringi claimed. He is the co-founder of Yatra.com.
He added that domestic tourist numbers are also expected to increase in line with the overall recovery in the sector.
“There is an increase in bookings related to short-term getaways, especially destinations close to key metro cities. Destinations that are seeing an uptick in demand for domestic tourists include Ladakh, Himachal Pradesh, Northeast, and Kashmir,” Shringi asserted.
India’s travel and tourism industry shrank to $121.9 billion in 2020 from a high of $194.3 billion in 2019 and is expected (conditions permitting) to reach $512 billion by 2029, according to a report by Anand Rathi Investment Banking.
Travel is expected to surpass pre-Covid levels by the end of the financial year 2023, with revenue of $200 billion, stated Ravi Kumar; He added there is demand for short domestic holidays, with extended weekend getaways the most preferred. He is the founder of udChalo, a travel company catering to India’s defense personnel.
“More than 50 percent of our inquiries have been for beach holidays, followed by holy pilgrimage sites like Shirdi and Vaishnodevi,” he said.
Pankaj Parwand observed that revenue per available room (RevPAR) reached 90 percent of pre-Covid levels. He is the co-founder of goStops Hospitality, the operator of backpackers hostels in India,
“Business travel is the reason for depressed yields. While business travel is almost at 70-75 percent of pre-Covid-levels, leisure destinations have surpassed pre-pandemic levels and have witnessed a 20-25 percent growth in RevPAR,” he commented.
Ritu Mehrotra noted that domestic travel continues to recover strongly, and inbound travel is also accelerating. She is the regional commercial director for APAC at Booking.com, “Our data shows that in May-June 2022, Indians are traveling to hill stations and beach destinations – including Goa, Ooty, Manali, Rishikesh, Srinagar, Darjeeling, McLeod Ganj, and Gangtok, in addition to metro destinations like New Delhi, Mumbai, Bengaluru, Chennai, and Kolkata,” She added.
She further commented that Indians are also planning their summer getaways to the UK(United Kingdom), France, the US (United States), Switzerland, Thailand, Canada, and Italy, with the borders opening again.
The number of domestic tourist visits grew by more than eight-fold to 2.3 billion in 2020 from 270 million in 2002, while the number of foreign tourists climbed four times to about 11 million in 2019. “However, overseas visitors dropped to 2.7 million in 2020 due to Covid-19 restrictions”, Anand Rathi said.
“While there are certain trend shifts, we observed that 94.8 percent of Indians choose to travel within India through our consumer survey, showcasing that domestic travel continues to be the most dominant choice,” claimed a spokesperson for OYO, a hospitality startup.
The spokesperson commented that there was a clear upswing in demand for leisure destinations during festivals and long weekends.
“We have already had two record-breaking festive weekend bookings in April. Over the Good Friday and Vishu week, we received 8 lakh bookings, the highest ever in 2022, surpassing New Year’s (of 2021),” he added.