Travel TrendsIndian carriers will be key in driving international travel, while making it more affordable for the middle-class population, says Sabre.

India's domestic travel booms, international follows suit

Domestic travel is already above pre-pandemic levels, and international travel is catching up.
Domestic travel is already above pre-pandemic levels, and international travel is catching up. Photo Credit: Adobe Stock/muratart

India's travel and tourism industry is poised for significant growth, with recent data from Sabre indicating strong potential for expansion. Domestic travel has already surpassed pre-pandemic levels, and international travel is quickly catching up. The country's middle-class segment is also expected to double in the coming decades, providing further opportunities for the industry to expand.

Sabre's analysis shows that there have been significant investments in the Indian tourism industry to support capacity requirements for both domestic and international travel.

Major plane orders by Air India, Akasa Air, and IndiGo are set to result in close to 1,200 more aircraft for Indian carriers over the next 24 months to meet the growing demand for travel. The Indian government has also announced a US$12 billion investment in aviation infrastructure upgrades to increase the number of airports from 148 to 220 by 2025.

Sabre's booking data reveals that domestic travel has already exceeded pre-pandemic levels, with domestic capacity having already surpassed 2019 levels since the beginning of 2023. The rise of low-cost carriers has helped to drive growth in domestic travel, with domestic capacity for LCCs recorded at over 110% of 2019 levels in Q1 of 2023.

International travel is also on the rise, with recovery rates of 95% in January 2023, 97.5% in February 2023, and 99.5% in March 2023. Indian carriers are expected to play an important role in the growth of international travel, with the aviation minister urging Indian carriers to fly more long-haul routes. Indian carriers now serve 42.7% of all international routes, an increase from 36% pre-pandemic.

The growing middle-class segment in India is expected to gain access to travel as travel becomes more affordable. The middle-class segment is expected to rise from 1 in 3, to 2 in 3 Indians by 2047.

As more Indian carriers add domestic and international capacities, alongside aviation infrastructure upgrades, travel will become more accessible and affordable, encouraging more Indians to travel.

Despite increased fares post-pandemic, travel demand remains strong. As capacity grows to meet and potentially exceed demand, coupled with various tourism investments aimed at making travel affordable, fare prices are expected to stabilise.

Brett Thorstad, vice president of Sabre Travel Solutions, Agency Sales, Asia Pacific, said, "All the indicators, the investment, and the conditions are there for substantial growth over the coming years. What is important now is that all players in the Indian travel ecosystem, and those who want to be players in the marketplace, understand and can harness these opportunities through advanced technology."

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