International travel needs to buck up after pandemic scare 

By Arushi Sakhuja

The pandemic impacted some sectors worse hit than others, travel and hospitality being one of them. But it also gave birth to the curious phenomenon of revenge travel, where people were waiting for borders to open, to start travelling again, more frequently than usual, to make up for the lost time. While the pandemic worked as a major setback for both international (and domestic) tourism, once borders opened and restrictions were brought down, travel resumed at a vigorous pace. 

Domestic tourism boomed especially in India while international travel did see a decline.  

This was one of the biggest and most prominent changes that happened during the lockdown. According to a 2021 report by Thomas Cook, tourism had increased by 300 per cent from pre-pandemic levels. It was during this time that the citizens were ‘forced’ to travel domestic and started accepting everything India has to offer said Devendra Parulekar, Founder, SaffronStays….. “They were more than willing to explore lesser-known destinations and experience Make-In-India for what it really is.” Adding further Udit Kumar, Co-founder, Brij Hotels shared that Domestic tourism has witnessed a massive uptick in recent years. Kumar believes this demand has further increased as the USD has heavily appreciated against the INR, which makes it more expensive to travel overseas. Further, huge delays in obtaining visas to travel internationally have led to an increased travel demand within India.  

“Domestic travel is no longer just about weekends,” rather, Devendra noticed two major trends that gained popularity in the last three years: workcations and driving to destinations. “With remote working/hybrid models, Indians were queuing up to get away from the cities on weekdays and weekends, and drive-to destinations close to their residences.”  But Udit Kumar, Co-Founder, Brij Hotels noticed yet another change in travellers pointing to the fact that… “… booking windows which used to be approximately 60-90 days is now reduced to 30 days or shorter.” Kumar also saw a change in the number of travel days, “…. pre-pandemic the average length of stay was 2 nights, and now it is upwards of 2.5 to 3.5 nights on average.” He attributes this to the fact that customers are now looking to spend more quality time at one destination, versus choosing to travel across multiple destinations during a holiday.  

But some of the popular destinations amongst domestic tourists that have witnessed excellent business according to Udit Kumar remain hill stations, and resorts ted in drivable destinations from tier 1 and 2 cities, Coorg, Ooty and states of Uttarakhand and Himachal Pradesh. “We have also seen an increase in demand for jungle or safari destinations like Ranthambore, Jawai and Kabini. Now as the monsoon has set in, there is a rise in travel interest for winter destinations, for example, Rajasthan and Uttar Pradesh,” he shared further.  

Although this was the silver lining that helped the hospitality industry get through these trying times, there was also a decrease in the number of international tourists visiting the country – a key contributing factor to the overall revenue.  

The Impact of the pandemic on international travel 

Before the pandemic hit, travel and tourism contributed to 10 per cent of global GDP. It was thanks to the substantial number of people who took international trips that in 2019, the number had reached 1.5 billion. However, there was a major stall that impacted the overall GDP of the world due to the pandemic. For two long years, international travel, which was a way of life, became a distant dream but finally, there was some light at the end of the tunnel in 2022 when travel resumed.  

The summer of 2022 saw travel return with vengeance. “This summer has shown a lot of pent-up interest in travelling. People have been confined to their homes and are now eager to travel, regardless of whether it is for leisure or business; and they are looking at travelling in the most frictionless manner,” Mr Sakari Romu, General Manager Finnair told Luxebook. While some jetted off to Europe and US others chose UAE as their preferred destination, as the popular destinations.  

According to a report by the United Nations World Tourism Organization (UNWTO) in July 2022, Internation tourism has more than tripled from January – May this year with arrivals at 46%; which is the same as was in 2019. The report further mentioned that 250 million international trips were recorded worldwide through May 2022 as opposed to 77 million in May 2021. But the first world countries like Europe and America continue to lead the travel recovery with European nations welcoming more than four times as many international arrivals and in America arrivals more than doubled although still lower than travel in 2019. Further, Asia and the Pacific saw arrivals almost double in number but still 90% below 2019. But when it comes to the countries that contribute the maximum to tourism in India Shanti Kohli, Managing Director, Amber Tours said they are US and Latin America tourists.  “Amber Tours has had clients from the US and Latin American travel as soon as the borders opened. Mostly high-end luxury travellers, sophisticated, well-informed guests who have been travelling throughout the pandemic to countries that were open and most importantly, not scared of getting on long-haul flights.”    

The Foreign Tourist Arrivals (FTAs) in March 2022 were recorded at 342,308 with a growth rate of 177.9% as compared to 123,179 in March 2021. The percentage share of Foreign Tourist Arrivals in India during March 2022 was from 15 major countries including USA (24.58%) followed by UK (14.01%), Bangladesh (11.78%), Canada (6.86%), Australia (5.68%), Sri Lanka (4.30%), Nepal (3.10%), Germany (1.94%), Singapore (1.79%), France (1.69%), Maldives (1.51%), Portugal (1.27%), Russian Federation (1.00%), Oman (0.95%) and Italy (0.93%). Giving the stats a nod was Sandeep Arora, Head of Brightsun Travel Private Limited India who shared that the greatest number of international tourists arrive in India from Bangladesh, the USA and the UK, followed by Russia, Canada and Australia. 

Looking at new and emerging travel trends, one of the most visible changes in the new market is the amount customers are willing to spend on travel. “In the new market, customers want to tailor their travel experience according to their individual needs – whether it is a more comfortable seat, choice of lounge access or inflight dining experience. The discerning customer is willing to spend to make their travel experience more enjoyable” shared Mr. Sakari Romu. Further, the UNWTO report also highlighted the rise in tourism expenditure globally. India, Saudi Arabia and Qatar were some of the top nations that matched pre-pandemic levels of expenditure.  

While the number remains low, airlines are seeing a bounce back than is quicker than ever shared a spokesperson at Vistara. “At Vistara, we have been witnessing healthy demand across our network and are already operating more domestic flights and carrying more passengers than we did pre-covid. The demand is mainly driven by leisure travellers and people visiting friends and relatives and corporate travel.” Although people are far more comfortable travelling internationally this year, experts tell us that international travel across the globe is still not back to what it was pre-pandemic. Speaking candidly, Shanti shared…. “I don’t want to say that the numbers have gone back to pre-covid days, but they are definitely improving and the holiday season bookings for post-October are looking very good. There is a large interest in India.” 

International Tourism in India 

After conservation with leading experts in the field, the common consensus is that although tourism in India is seeing a boom most of the revenue is an outcome of domestic travel, but India is still a tourism market that is being explored. ” With the easing of travel restrictions and international flights resuming to almost 2019 levels, international tourism saw a strong rebound in the first five months of 2022. Likewise, India is also seeing significant growth and recovery in the travel and tourism and hospitality segment,” said Sandeep Arora.  

But when it comes to the rising airfares, that does not seem to be a hindrance for avid travellers. ” Even in the July-September quarter, which is a weak period for domestic travel historically, we are observing healthy demand across the network,” further shared Vistara’s spokesperson. Adding further and giving a global perspective Shanti believes… “The ticket prices have definitely gone up, but this is not India specific, it’s global. Travellers are aware but it’s not stopping people from travelling – flights are full, and demand is high.” On the other side, Sandeep Arora is of the opinion that “The hike in airfare has the potential to slow the rebound growth and momentum of the industry.” The price hike, he says is due to the rise in fuel prices attributed to geopolitical issues like Russia Ukraine war.  

There has been a significant increase in demand for domestic flights, however, the statistics (for domestic and international travel) are still not back to what they were pre-pandemic. But the government has stepped in this year to give a boom to the tourism sector. In the budget 2022-23 the Ministry of Tourism has allocated Rs. 2,400 crores for tourism which is 18.42 % higher than the allocation for FY 2021-22. Further, since November 2021, India has opened its borders allowing fully vaccinated foreign tourists to visit India, which in turn will help give a boost to the travel and hospitality sector. And finally, the introduction of e-visas to 171 countries in March 2021 is expected to double the tourist inflow in India.  

Painting a clearer picture of tourism in India, Mr. Sakari Romu of Finnair shared their thoughts. “During the summer of 2022 Finnair was using about 80% of its capacity, so we are nearly at the same level as 2019,” said Sakari. He further hopes the airline will match the pre-COVID level numbers by next summer.  But when it comes to the hospitality sector Rajat Gera, Director of Sales and Marketing, Six Senses Fort Barwara shared, “We are just on the brink of revival and have yet not fully recovered when it comes to inbound travel. We are expecting the advent of international travellers to India only by Q4 of 2022, which has been due for a long time. In early 2023, we foresee the rise of inbound travel to 50-70% of pre-covid numbers.”  On the contrary, Udit Kumar or Brij Hotels said, “We feel that travel has bounced back much stronger than compared to pre-covid times. We have seen our hotels beat pre-covid numbers.” 

Although scheduled international flights have been resumed since March-end, Arora notes that the numbers are still low when compared to 2019 and Indian tourism is seeing a stiff competition from countries like Thailand, the UAE and even Nepal. “The inbound tourism sector is forecasted to witness a rebound in growth. We are expecting a lot of movement from the UK, Europe and the USA in the next few months which is the peak season in India, but I think, it will take another 2-3 years for inbound tourism to go back to pre-pandemic levels.” 

Top destinations in India for inbound tourism 

“Tourists coming to India are mostly interested in exploring the history and architectural heritage of the country,” shared Sandeep Arora.  Some of the top destinations in India include Rajasthan, South India, Jammu and Kashmir, Delhi and Mumbai shared Shanti. However, Rajasthan continues to be the number one destination for both Shanti and Sandeep. Additionally, the aura of the Taj Mahal makes it one of the top tourist attractions for international tourists as well said Sandeep. But another destination that is of interest Shanti says is ‘the South of India and interestingly, Kashmir.’  

While the upward trend of travel is a positive takeaway, it is not without acknowledging the fact that the process is a slower one. But an interesting takeaway in the hospitality sector is that there has been an increase in the demand for luxury stay among Indian consumers, due to rising consumer spending. In line with this, key players are expanding their presence to cater to this demand.

To conclude we can say, the outlook of the Tourism and Hospitality sector looks on track with the pandemic easing out. However, not without understanding that it will be a slow process. 

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