Tourism and Hospitality

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India’s tourism stands 7th out of 182 countries in the world. The sector witnessed a 15.6% growth in 2017 with 10.18 million Foreign Tourist Arrivals(FTAs). Foreign Tourist Arrivals (FTAs) during the period January-November 2018 were 93,67,424 as compared to 88,67,963 in January-November 2017 registering a growth of 5.6% over the same period. During January- November 2018, a total of 20,61,511 tourists arrived on e-Tourist Visa as compared to 14,56,615 during January- November 2017, registering a growth of 41.5% over the same period.

Foreign Exchange Earnings (FEEs) during the period January- October 2018 were Rs. 1,58,846 crores as compared to Rs. 1,41,965 Crore in January- October 2017 register a growth of 11.9% over the same period. The number of Domestic tourist visits to all states and tourism were 1652.49 million with annual growth rate of 2.3%, during FY17. Share of India to total world tourist arrivals accounted for 1.17%, whereas India ranked 13th in the world tourism receipts with a share of 2.05% (US$ terms) in the same year. According to Make in India portal of Government of India, 78 jobs are created with every USD 1 million invested in tourism sector. Approximately 41,622 jobs were created during 2017 in tourism sector. This sector contributes 9.38% to total GDP of the country.

Number of approved hotels in India between April- December 2018 are as follows:

Sr.No Category of Hotels Number of Hotels
1. One star 3
2. Two star 1
3. Three star 106
4. Four star 56
5. Five star 33
6. Five star Deluxe 32
Source: Ministry of Tourism

Tourism in India has a spectrum of niche tourism that ranges from cruise, adventure, medical, rural, sports and wellness, Meetings, incentives, conferences and exhibitions (MICE), ecotourism and spiritual tourism. The luxury travel market in India registered a growth rate of 12.8% in 2015, the highest in comparison with any other BRICS country.

Total Business tourism spending was USD 11.6 billion whereas total leisure spending on tourism was 201.7 billion in FY 2017.

The following table shows: Trends of metrics in outbound tourism of the country.

Units: $ billions (for spending categories)

Particulars 2015 2016 2017 2018 (Estimated)
Total domestic travel spending $163.8 $179.30 $186.0 $199.60
Total foreign inbound visitor spending $21.9 $24.20 $27.3 $29.7
Total outbound spending $16.3 $18.0 $18.0 $18.80
Total Market Size (Outbound travelers in millions) 20.38 21.87 22.0 (Estimated) 22.50
Source: World Travel and Tourism Council (WTTC)

100% FDI is allowed under the automatic route in tourism and hospitality, subject to applicable regulations and laws. 100% FDI allowed in tourism construction projects, including the development of hotels, resorts and recreational facilities. According to Department of Industrial Policy and Promotion (DIPP), tourism and hospitality sector attracted FDI of US$ 11.39 billion during April 2000- June 2018.

Medical tourism is expected to outcross other niche tourism sectors of the country. It is expected to touch USD 9 million by 2020. On the other hand, international tourist arrivals are expected to touch 30.5 million by 2028. During January- September 2018, the number of e-visa arrivals were 1.58 million, which may cross the previous year benchmark of 1.69 million by the year end. E-visa facility is offered to 163 countries as of March 2018. The tourism & hospitality sector’s direct contribution to GDP in 2017, was Rs 5.94 trillion (US$ 91.27 billion). This is expected to reach Rs 12.68 trillion (US$ 194.69 billion) in 2028, implying a CAGR of 7.23 per cent during 2012-28.

The following table shows the estimated figures of tourism in FY 2018:

Amounts in $ billions

Metrics 2018(Estimated)
Direct contribution to employment (% growth) 2.8%
Business Tourism Spending 13.5
Leisure Tourism Spending 236.7
Total contribution to Employment (%) 8.1 %
Total contribution to GDP (%) 9.4%
Visitor Exports (Foreign spending) 32.4
Outbound Travel & Tourism Expenditure 20.5
Investment (Capital investment) 48.4
Government Individual Expenditures 0.5
Domestic Tourism Spending 217.8
Internal Tourism & Travel Consumption 250.2
Source: World Travel and Tourism Council (WTTC)




  • 12 Institutes of Hospitality Management were sanctioned in north-east states in August 2016.
  • Swadesh Darshan scheme is one of the flagship schemes of the Ministry of tourism for development of thematic circuits in the country in a planned and prioritized manner. The scheme was launched in 2014 -15 and as on date, the Ministry has sanctioned 74 projects worth Rs. 5997.47 Crore to 31 States and UTs. There are 13 tourism circuits that have been identified so far and a few proposed tourist circuit by Walk Through India such as Shiva Temple Circuit, North East India Circuit, Buddhist Circuit, Himalayan Circuit, Coastal Circuit, Jain Circuit, Krishna Circuit, Desert, Tribal Circuit, Eco Circuit, Gurdwara Circuit, Adventure tourism Circuit and Cruise tourism. Under the tribal circuit theme of the scheme, the Ministry has sanctioned 4 projects to Nagaland, Telangana and Chhattisgarh for Rs. 381.37 Crores in September 2018.
  • To boost the image of India in the international travel market, ‘Incredible India 2.0’ campaign was unveiled across the world in 2017. Ministry of Tourism launched an Online Learning Management System for creating skilled manpower to work as tourist facilitators. The initiative will enable the youth living in remotest part of the country to skill themselves and facilitate tourists on Pan India basis. The Online Learning Programme will also lead to creation of jobs and providing facilitators to tourists at reasonable cost. Incredible India Tourist Facilitator Certification currently has 3800+ enrolment across country.
  • 100 crores have been allocated for Pilgrimage Rejuvenation and Spiritual Augmentation Drive (PRASAD). An amount to the tune of Rs. 412 crore was provided for promotion and publicity under the 2017-18 budget.
  • Ministry of Tourism organized the International Buddhist Conclave-2018 (IBC-2018) on the theme “Buddha Path—The Living Heritage” in collaboration with the State Governments of Maharashtra, Bihar and Uttar Pradesh.
  • The National Heritage Development and Augmentation Yojana (HRIDAY) that seeks to preserve and rejuvenate the rich cultural heritage of the country, was launched in January 2015. HRIDAY seeks to promote an integrated, inclusive and sustainable development of heritage sites, focusing not just on maintenance of monuments but also on advancement of the entire ecosystem including its citizens, tourists and local businesses. Based on city population, Varanasi (Uttar Pradesh) was allocated Rs.89.31 crores, Amritsar (Punjab)- Rs.69.31 crores, Warangal (Telangana)- Rs.40.54 crores, Ajmer (Rajasthan)-Rs.40.04 crores, Gaya (Bihar) -Rs.40.04 crores, Mathura (Uttar Pradesh)- Rs.40.04 crores, Kanchipuram-Rs.23.04 crores and Vellankini- Rs.22.26 crores, (both in Tamil Nadu), Amaravati (Andhra Pradesh)- Rs.22.26 crores, Badami (Karnataka)- Rs.22.26 crores, Dwaraka (Gujarat)- Rs.22.26 crores and Puri (Odisha)- Rs.22.54 crores.
  • An investment-linked deduction under Section 35 AD of the Income Tax Act is in place for establishing new hotels in the 2-star category and above across India, thus permitting a 100% deduction in respect of the whole or any expenditure of a capital nature excluding land, goodwill and financial instruments incurred, during the year.
  • Incentives offered by State governments include subsidized land cost, relaxation in stamp duty, exemption on sale/lease of land, power tariff incentives, concessional rate of interest on loans, investment subsidies/tax incentives, backward areas subsidies and special incentive packages for mega projects
  • Incentives are provided for setting up projects in special areas – the North-east, Jammu & Kashmir, Himachal Pradesh and Uttarakhand.