High disposable income driving India’s domestic travel

According to a report titled ‘Hospitality insights from the Indian CEO’s desk’ by CII and PWC, the biggest driver in the growth of domestic travel in India is high disposable income. With the buoyant growth in the Indian economy, the Indian middle class has higher disposable income. This has been identified, by about 94 per cent of the respondents as a key factor for the increased domestic travel across the country. Over 40 per cent of the respondents believed that the increased demand would come from new locations largely due to better access and improved infrastructure. Therefore, a significant supply is being developed and likely to develop at such locations. Higher disposable income is driving domestic tourism. In terms of promotion, all the options available today can be seen online and it is very convenient for customers to access the available options. This has made a huge difference to the industry. Growth in the domestic travel has also accentuated the demand for different categories of hotels. Affordability and quality of experience are key factors in defining this shift away from five star to more budget category hotels. Although travellers value loyalty programmes and promotional schemes, the survey participants do not see it as a key determinant in selecting their accommodation. Other factors that are contributing to the growth in domestic tourism include access to online travel and hotel bookings.