2013-09-01 09:08:21 - New Consumer Goods research report from Business Monitor International is now available from Fast Market Research
BMI's India tourism report looks at the enormous potential for growth offered by the tourism market, with a burgeoning domestic economy complementing increases in inbound travel throughout the forecast period. India's increasingly affluent middle class, and its range of natural and cultural tourist attractions make the country a consistently popular destination for both travellers and investors. We therefore expect to see substantial growth across a range of market indicators including arrivals, departures, number of hotels and tourism receipts.
India's transport and accommodation infrastructure is in need of extensive expansion and modernisation. Progress was made in the run up to the the Commonwealth Games in 2010 when, despite some concerns in the run up to the games, massive improvement were made in
India's tourism related infrastructure. Moving forward the government is focusing on making extensive improvements to the country's rail and air transport networks. In particular the domestic air travel industry appears to be recovering from economic and managerial problems in 2011 and 2012, caused in part by large fluctuations in oil prices, and BMI expects to see overall growth in air travel moving forward, as the domestic market expands and the coverage of domestic airlines is extended.
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As well as improvements to the country's air travel facilities, India is also embarking on an ambitious programme of extensions and expansions to the country's rail network. Currently the rail network, despite being one of the world's largest, frequently suffers from overcrowding and a lack of adequate facilities which are limiting the growth potential. Continued government support and investment mean substantial improvements should be realised in forthcoming years, and are indeed sorely needed if India is to keep pace with rising demand.
While India itself benefits from a generally stable democracy, with a large labour resource pool, excellent natural resources and strong international market links, regional tensions are a risk to India's tourism market, with any flare up likely to impact heavily on inbound tourism. Security concerns remain in the wake of the Mumbai hotel attacks in 2008, led by terrorist groups based in Pakistan and a spate of high-profile violent attacks on women in the past year, including tourists, could also affect inbound travel. It is therefore important that the government is seen to take a strong stance against violence of this nature.
Despite these concerns, India is an enduringly popular tourist destination, and in recent years has developed from a backpacker destination to a luxury tourism market with an increasing number of high end resorts and hotels catering to the higher spend travellers. The country offers a wide variety of destinations, from tiger treks in rural jungles to pristine beaches and modern metropolises and while we expect to see the global credit crunch continue to impact on long distance travel to the country from Europe and the United States overall we expect to see an increase in travel from all regions, with travel from within the Asia Pacific region looking particularly strong. India will also benefit from hosting the 2020 World Cup in cricket in 2016 which should see further investments to the country's transport and tourism infrastructure.
Recent events and changes in BMI forecasts include:
* Many of the major hotel chains are expanding their presence in India. Hyatt opened five new hotels in early 2013 and Hilton is also looking to expand into the luxury market, opening its first resort, the Hilton Shillim Estate Retreat and Spa offering 99 villas set in 70 acres, in 2013. Starwood expects to open between 6 and 8 new hotels in 2013 aiming to have 100 hotels under different stages of development by 2015.
* Large scale investment in transport infrastructure will be seen in 2013 with the development of the international airport at Navi Mumbai, expansion of Indira Gandhi International Airport and Cochin International Airport, as well as many other projects on the rail network.
* Outbound travel is expected to continue to increase by between 9% and 14% per year to reach over 23.1mn per year by 2017, an increase on the previously forecasted 20mn travellers per year by 2017 based on an improved domestic economic forecast.
* Inbound tourism is also expected to increase, albeit at a smaller rate of around 5% to 6% per year, to reach over 8.7mn by 2017.
* This quarter BMI awarded India an overall Tourism Industry Risk/Reward rating of 43.57, putting it ahead of Indonesia but behind Cambodia.
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